Almost half of big UK employers using insecure contracts

Almost half of large British employers offer jobs with no guaranteed minimum hours or pay, official data showed on Wednesday, reinforcing concerns that the labour market is less healthy than headline figures suggest.

Some 1.4 million jobs are offered on the basis of so-called “zero-hours contracts” or similar arrangements which have faced increasing political criticism over the past year, the Office for National Statistics (ONS) said.

The figures come from the ONS’s first survey of employers’ use of zero-hours contracts, and suggest that the number of Britons who work on zero-hours contracts may be far higher than the 583,000 it estimated last month, even with some holding more than one contract and others unsure of their status.

“Insecure work with no guarantee of regular paid hours is no longer confined to the fringes of the jobs market,” Frances O’Grady, the general secretary of the umbrella group for Britain’s unions, said after the data.

Britain’s Conservative-led government has promoted the record number of people in private-sector employment as one of its main achievements since coming to power in May 2010.

But the opposition Labour Party has said this has come at the cost of lower living standards, and last week its leader Ed Miliband said he would curb the use of zero-hours contracts if he wins next year's elections.

A survey by the Resolution Foundation think tank, published just before the ONS data, showed that three in 10 people in zero-hours contracts wanted more work, compared to just one in 10 of those with fixed-hours contracts.

"The significant minority of zero-hours staff who are looking to work more hours suggests a (level of) slack in the labour market which could have serious implications," said Laura Gardiner, a researcher at the foundation.

The ONS study showed that one in eight employers used zero-hours contracts or something similar, rising to nearly half for employers with over 250 staff.

Zero-hours contracts are particularly widespread in tourism and catering, and are also common in health and social work, such as caring for the elderly.

Students, women and people aged under 25 or over 65 are disproportionately likely to work under zero-hours contracts.

“These patterns may partly reflect the groups most likely to find the flexibility of ‘zero-hours contracts’ an advantage,” the ONS said.

However, the contracts offer no minimum amount of work or pay each month, even though they can require workers to be available at short notice, bar them from employment elsewhere and allow shifts to be cancelled without compensation.

The ONS said the actual number of people employed under zero-hours contracts was still uncertain. Wednesday’s figures refer to the number of contracts - not the number of people - and one person might have more than one contract.

However, the figure of 1.4 million contracts did not include a further 1.3 million contracts under which no work was done during the ONS survey period over two weeks in late January and early February.

While the 1.3 million might include some people who were no longer available for work, it was likely that others should be counted as zero-hours contracts, the ONS said.