In 2023 there were approximately 1.18 million people on zero hours contracts in the United Kingdom, including 28.5% of the accommodation and food sector workforce.
As such, the plan announced in the King’s Speech at the State Opening of Parliament this morning to ban exploitative working practices and enhance employment rights, a debate of which zero hour contracts has been at the centre of, may be met by frustration.
David Rogers, Vice President of Sales at digital workplace platform for frontline workers, WorkJam, has reassured business leaders that if they invest in the right technology to manage their workforce, they can comply with this new policy, whilst optimising productivity and not bleeding time and money.
Rogers said, “UK businesses who rely heavily on zero hour contracts may feel frustrated by the official announcement of the ‘Make Work Pay’ plan in the King’s Speech. Although details of exactly what this will mean are still unconfirmed, the declaration to ‘ban exploitative practices and enhance employment rights’ is likely to include restrictions on zero hour contracts, which will have a huge impact on many businesses.
“They will bleed hours and bleed money if they don’t prepare accordingly. But the winners in the long run will be the companies who see this as an opportunity to leverage new technology to create a more rewarding experience for workers, while simultaneously delivering the scheduling agility many industries need in the current economic climate.
“It’s not just about upgrading workers’ rights in the UK but upgrading the quality of experience everyone has while they’re at work – regardless of whether you describe yourself as a casual, gig, or part-time worker.
“Productivity is driven by engagement and manual processes make this challenge even harder. Taking a technology-led approach allows you to go beyond providing a base level of predictability and instead focus on unlocking the power of the frontline workforce through proactive, personalised engagement and communication with employees.
“Flexible scheduling functionality, which makes scheduling easy for the business and its workforce, is one step on this journey. Using technology to open direct lines of communication with frontline workers has an empowering and engaging effect.
“It increases flexibility for both workers and employers by aligning the organisation with the workforce, creating a more rewarding workplace for employees that works to attract, support, and retain people more effectively.”
IR35 specialist, Qdos, has welcomed the news, urging the government to ban ‘zero rights employment’ – which occurs when a contractor is engaged inside IR35, where they pay employment taxes but don’t receive employment rights in exchange.
The King’s pledge forms part of the Labour Party’s ‘New Deal for Working People’, which includes the promise to “consult in detail” on the introduction of a single ‘worker’ status, and the introduction of a “simpler framework that differentiates between workers and the genuinely self-employed”. The complexities of the current regime have been exposed in a number of high-profile and costly legal battles in recent years, concerning the rights of ‘gig workers’ engaged by companies such as Uber and Deliveroo.
Seb Maley, CEO of Qdos, said, “The King’s speech highlighted just how many pressing issues the government will face over the course of its parliamentary term. Among those are the exploitative practices that flexible workers currently face, whether in the form of so-called ‘zero-rights employment’, or as easy targets of tax avoidance schemes in the unregulated umbrella sector.
“For instance, contractors engaged inside IR35 are treated as employees for tax purposes but do not have access to any of the statutory rights or protections that employees do, leaving them at a considerable disadvantage to other workers.
“Meanwhile, the introduction of a ‘New Deal for Working People’ could help to draw clearer lines between employment and genuine self-employment – which can be a minefield. You only have to look at the countless employment tribunals in the gig economy.
“Ultimately, the devil will be in the detail and the government must strike the right balance. When it comes to employment rights, a one-size-fits-all approach won’t work, with many genuinely self-employed workers valuing their independence.”
