Zero Hour Contracts - A Greater Understanding of the Nature of Agency Work

Wed 27 Apr 2016

A man writing

What we have seen in recent years is the issue of zero hour contracts dominating political discourse and media headlines. There have been consistent promises and pledges from the government to reduce the UK’s dependence on zero hour contracts and the use of agency staff. However, in a recent report from the Office for National Statistics, it would appear that there are currently 801,000 people on zero hour contracts.  To put this into to context, this is enough people to fill Old Trafford stadium ten times over. This represents a 15% increase on the previous year. Whilst this may appear alarming, we are not saying that there isn’t a role for zero hour contracts in the UK market place as they often suit some specific lifestyles and needs. However, it is undeniable that those employed through zero hour agency contracts lack the same level of security as permanent employees and find it more difficult to effectively plan for things such as mortgages. 

Unequal Pay for Equal Hours

A recent report from the Chartered Institute of Personnel Development (CIPD) brought some more in depth analysis regarding the nature of zero hour contracts and the roles of agency staff. Their research found that over 25% of the employers interviewed use workers on zero hour contracts for their administrative positions. While this isn’t a a surprising discovery in the current job market, what is concerning are the levels of pay for people in these positions. The research highlighted that 49% of those sampled earn less than £15,000 and 26% of those interviewed earn between £15,000 and £25,000 per annum.  It could be seen that this is simply the going market rate but the CIPD’s research also highlighted that the average hourly rate of agency staff was £8 as opposed to the £12 average of their permanent equivalents. Highlighting that those on zero hour contracts are in a considerably weaker position than their permanent counterparts.

A Weaker Position in a Stronger Market Place

This has become even more prevalent when looking at MOL’s market research using Economic Modelling Specialists Intl market modelling software. What we can see through our research is that administrative HR positions are set to grow by 5.9% until 2020, which is 0.4% above the national average. This means that over 3000 new jobs will be created in this sector in the next 4 years. This is positive news, and the CIPD’s December report states that the majority of people on zero hour agency contracts have achieved qualifications of A-level standard. The research that we undertook discovered that the qualifications needed to gain a position within Human Resource departments were GCSE level. Research indicated that in 2015 over 50% of those in HR administrative positions are employed through agencies and are thought to be on zero hours contracts, meaning that 50% of people in this sector lack the same level of job security as their colleagues in permanent positions.

Greater Security in the Job Market

So the question is what should you do if you’re in this position? CIPD are setting the market standards for HR professionals and one of the best ways to increase your employability for permanent HR positions is to achieve one of their qualifications. The CIPD L3 is designed to cement the core functional skills needed for HR and L&D professionals. Furthermore, these qualifications act as a great stepping-stone to a long and stable HR career, helping people move away from working zero hour contracts through agencies. Additionally, MOL now has access to government 24+ learning loan funding, which can help towards the cost of course fees meaning it has never been easier to study with MOL and gain a rewarding career in the HR profession

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