Could new legislation be on the way for zero hours contracts?

Business secretary Vince Cable has ruled out completely banning zero hours contracts, but has nonetheless suggested that they could be subject to new government legislation, in news that will interest many firms receiving HR advice from Employee Management Ltd (http://www.employeemanagement.co.uk).

Since June, Cable has been overseeing a review into the issue for the government, and said that he might consider a change to the rules for workers for whom only work for a single employer was allowed.

He commented: "Where it is a problem is…where there is an exclusive relationship with a particular employer who actually cannot provide stable employment, or indeed any employment, that stops the worker going to another company."

Cable said that the problem with zero hours contracts might be confined to the issue of people being in the exclusive employ of one firm, and that he wished to uncover how common the practice was. He added: "I'm holding open the possibility that next month we could move forward with recommendations to consult on legislation, but we haven't got to that point yet."

The issue is being examined by three people in Cable's department, with a decision set to be made by the business secretary in September on whether specific proposals are to be subject to a formal consultation. No 10 denied that it was not acting sufficiently urgently with regard to the issue.

The Office for National Statistics has admitted that its official estimate of 250,000 zero hours workers may be off the mark, and is planning the production of a new survey next spring and summer, making use of new questioning techniques. It follows the Chartered Institute of Personnel and Development's report claiming there to be one million workers on the employment contracts.

Shadow business secretary for Labour, Chuka Umunna MP, said that unnecessary strain was being put on family life by the issue, stating: "Zero-hours contracts are making hundreds of thousands of people worried about whether they will have enough work or be able to put food on the table for their children week by week."

He added that the party believed that such contracts "should be the exception, not the rule." He said that while some employees found such flexibility important, it was now "clear that far too many workers and families are now caught in this zero-hours trap." Andy Burnham, the shadow health secretary, has even suggested a ban on zero hours contracts.

Although George Osborne welcomed a review into zero hours, he did also suggest the importance of "a growing economy, and that's absolutely what we're setting about trying to achieve." Pointing out an increase in the total number of hours worked in the economy, he said: "Let us see if there is a problem before we try to fix it."

Here at Employee Management Ltd (http://www.employeemanagement.co.uk), we'll keep a keen eye on the latest developments in the zero hours debate - and in the meantime, welcome enquiries on employment documentation from any of our existing or prospective HR support clients.

Editor’s Note: Employee Management Ltd (http://www.employeemanagement.co.uk) are represented by the search engine advertising and digital marketing specialists Jumping Spider Media. Email: info@jumpingspidermedia.co.uk or call: +44 (0)20 3070 1959 / +34 952 783 637.