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18 Nov


Addressing the Imbalance of Power in ‘Zero Hours’ or ‘Banded Hours’ Contracts

18th November 2015 | By |

Dunnes Stores Strike Poster

Dunnes Stores Strike Poster

The issue of so-called zero hours contracts has appeared frequently in the Irish and British media this year with the strike in Dunnes Stores strike in April, protests against Sports Direct in the UK, a recently published study by researchers from the University of Limerick on the prevalence of such contracts in Ireland and a sharp rise in their use reported in the UK

Zero hours contracts strictly mean that a worker has to be available to their employer but gets no guarantee of any work. More common in Ireland are banded hours contracts which guarantee a minimum number of hours per week but not necessarily when those hours will be rostered or how many hours will be assigned from week to week. The recently published report carried out by University of Limerick found that what they termed ‘if and when’ contracts were more prevalent in Ireland. The hours of work are not guaranteed but neither does the employee have to make themselves available.

These types of contracts tend to be more common in low paid jobs in the retail and service sectors. So what are the pros and cons of such contracts? Clearly, they offer businesses maximum flexibility to staff up or down depending on how busy they are. They are often touted as providing flexible work for those who don’t want full time jobs, such as carers, parents of young children (by which I suspect the proponents actually mean mothers) and students. While I appreciate that many people don’t want full time work, I suspect most people have some kind of life they need to fit around their work. I am frequently amazed by the implication contained in reporting on this subject that low hours flexible contracts are particularly useful for students. This is suggesting that it’s okay for students to drop their college work at a moment’s notice as though their classes have little value.

Disadvantages for workers in this situation include the inability to plan social events or other appointments, difficulty in sorting out child or elder care, the extra costs associated with arranging such care at short notice and even commuting to a workplace that might then decide to send them home after a couple of hours if it isn’t busy. It’s not inconceivable that a worker would be left at a net minus if they organise childcare and pay a bus fare to work only to be sent home after a couple of hours. These workers are also prevented from accepting work from other employers since they don’t know when they’ll be available. Their uncertain hours mean uncertain pay and with that worries about their ability to meet bills, secure tenancies and little likelihood of qualifying for loans or mortgages.

Although these contracts are often presented as offering maximum flexibility to both employer and employee, this clearly ignores the imbalance of power that exists. These contracts are most prevalent in low paid work. The workers know that they are easily replaced and are therefore operating at a disadvantage meaning they are scared to protest against bad treatment and unwilling not to show up when asked. Saying that ‘if and when’ contracts address this ignores the reality that workers are afraid of being seen as uncooperative and disobliging if they refuse to come in. I’ve seen the panic in some of my students’ eyes when they get a text message from their employer ‘asking’ them to come in. Rostering tends to be done at business unit level by the local manager so the system of low hours or ‘if and when’ contracts facilitates a bullying or discriminatory individual abusing their power behind the shield of good budget management. I’ve seen examples of a store manager giving the prime shifts to the workers of their own nationality while the workers of another nationality always get the less desirable hours and/or fewer of those hours.

Low hours contracts are not just the preserve of minimum wage workers and are commonly used for part-time lecturers in third level educational institutions as well. I am one of those lecturers and while I have certainly seen the situation abused in some instances, lecturers tend to have choices denied to many low hours contract workers and have a much greater negotiating power to organise hours that suit them. The power balance is a great deal more even.

What does it mean for society? It’s often argued that the good value we get when shopping is linked to retailers’ ability to staff appropriately without any wastage. While there is a degree of truth in that, we also need to recognise that as a society we still pay for those workers, just not at the tills. Such working hours likely cost us eventually in stress related sickness, the need for additional social security benefits, housing supplements and various other costs related to the care of the families of such workers. The students that miss classes and need to repeat subjects are also subsidised by the taxpayer. It seems to me that we are permitting businesses to get away with poor planning and make additional profits through the use of such contracts at the expense of the taxpayer.

So what can be done? I’m not suggesting that we get rid of flexible working arrangements. I understand the pressure on margins and the desire to be responsive to customers (but if Primark can work without banded hours contracts I really don’t see why other businesses can’t manage it). I also understand that for some staff the flexibility of part-time work is wonderful. I’m not against part-time work at all but I am against flexibility being used as a reason to leave a lot of (low paid) workers in contracts that are unbalanced in their fairness with most of the power being in management hands. So we need to find a way to address the power imbalance.

A number of sensible proposals have been made by the University of Limerick researchers including:

  • Contracts should be issued to employees on their first day,
  • The minimum period an employee should be made to work should be three hours,
  • Employees should be given at least 72-hours notice before being called in – or otherwise be compensated by being paid time and a half,
  • Employees should be given 72-hours notice of cancellation of hours

I suggest that we could go further and should also distinguish between large businesses and smaller ones. One hopes that in smaller businesses there is greater communication between worker and manager leading to easier collaboration in the setting of shifts. Small businesses also lack other advantages enjoyed by bigger operations. Larger businesses have greater ability to re-allocate workers to other tasks if they are not busy. They may also have better ability to plan. For example a large-scale retailer has vast amounts of sales data at their disposal which if analysed enables them plan staffing requirements very effectively. For a larger business it should be possible to give staff their shifts a week in advance to enable workers plan more easily. It should also be possible for larger businesses to seek to accommodate workers preferences to some extent at least. If local managers are in charge of setting rosters there should be some kind of system for Head Office to check they are carrying out their duties appropriately and not using their power to bully or intimidate workers.

Maybe as shoppers we should start voting with our feet. Ask to speak with the manager of your local supermarket which is probably where you spend most money in a business which is likely to use these contracts. Tell the manager your concerns. Ask them what they are doing to ensure workers can plan more effectively. Ask them how they use their sales data to predict their staffing requirements. Ask them if head office conducts checks to help guard against abuse of workers by rostering managers. Ask them why they can’t follow the example of Primark (Penneys). If enough of us show we are concerned the message might start to filter through to the senior management.