A lot has been written this week about zero-hour contracts, whereby employees need to be available for work, but are not guaranteed any set number of hours.
A lot has been written this week about zero-hour contracts, whereby employees need to be available for work, but are not guaranteed any set number of hours. Although some people see this arrangement as something akin to exploitation, this level of flexibility can be a real lifesaver for retailers who are battling a perfect storm of rising rents, sky-high business rates, cash-strapped consumers and increased commodity prices.
There are many fixed costs in a retail business that companies simply can’t control, so it’s vitally important to drill down and find any costs that can be reigned in wherever possible. Of course, when we’re talking about people, the story quickly becomes a lot more emotive, yet importantly, the principle remains the same.
The truth is that zero-hour contracts may be necessary to keep some retailers viable in the current market - and so isn’t a zero-hour contract better than no contract at all? Zero-hour contracts can actually provide a foot in the door for people who are either new to the workforce or have commitments that make it difficult to work full-time.
Students, for example, may see contracts like these as an easy way to pick up a little extra money - and experience - during their holidays, without having to commit to a rigid schedule. The same could be true for some older workers who want to top up their pensions with a bit of irregular, part-time work.
The benefits for retailers are even more obvious, but business owners do need to agree some ‘rules of engagement’ up front to avoid any accusations of exploitation. For example, ensuring that strict rules are enforced and adhered to regarding the notice period required for calling staff into work. This kind of even-handed approach will go a long way towards diffusing some of the criticism that we’ve been seeing in the press. After all, it doesn’t seem very fair to be routinely ringing employees at 9pm to tell them that they need to be at work the next morning.
Ultimately, it comes down to getting the balance right. Retailers clearly have a lot to gain from zero-hour contracts in terms of flexibility - but what are they giving in return? If employees are being rewarded with fair pay, solid training and regular incentives, then zero-hour contracts are likely to appear much less contentious.
Business Secretary Vince Cable has just ordered a review of zero-hour contracts. In doing so, he said: “While it’s important our workforce remains flexible, it is equally important that it is treated fairly” - and surely no one can argue with that?
- Dan Coen, director, Zolfo Cooper
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