Key facts
- Trade unions are concerned Labour's plan to reform zero-hours contracts may not fulfill manifesto promises.
- Unions are seeking assurances from Business Secretary Jonathan Reynolds on the policy's scope.
- Specific concerns include limitations on who qualifies for guaranteed hours contracts and 'regularity requirements'.
- Business groups estimate the most expansive version of the policy could cost companies up to £2.9bn annually.
- The government states it is committed to ending exploitative zero-hours contracts and is consulting stakeholders.
Trade unions are voicing concerns that the Labour party's proposed reforms to zero-hours contracts may fall short of their manifesto pledge to eliminate exploitative contracts. Union leaders, including representatives from Usdaw, GMB, and Unite, are seeking assurances from Business Secretary Jonathan Reynolds that the new policy will provide genuine income security for all workers.
Key points of contention include the proposed limitations on who will qualify for new guaranteed hours contracts, with unions arguing that any threshold could create loopholes and render the policy ineffective. Unite specifically highlighted a suggested 'regularity requirement' that they claim would exclude a significant number of workers from qualifying for the right to a contract matching their usual hours.
Business groups have reacted strongly to the potential costs, with official estimates suggesting the most expansive version of the policy could cost companies up to £2.9 billion annually. The British Chambers of Commerce described this as a "hammer blow" for struggling businesses. However, the TUC countered that a significant portion of this cost estimate is based on employers paying compensation for cancelled shifts, assuming no behavioral change. The TUC also emphasized the real-world costs of insecurity for workers, including mental health and financial strain, stating most people do not want to be on zero-hours contracts.
The zero-hours contract changes are part of Labour's Employment Rights Act, which has passed into law, but the implementation details are still being finalized. The government has stated its commitment to ending exploitative contracts and is currently consulting with businesses and trade unions to ensure the reforms are practical and effective.