The media recently reported that the government’s Employment Tsar Matthew Taylor was set to recommend a major change to zero-hours contracts that could shake up the way many organisations approach workforce planning and management.
The rumoured change could see employees on zero-hours given the ‘right to request’ a move onto fixed-hours contracts.
There are currently 900,000 individuals on zero-hours, a 530% increase since 2008.
If implemented, it would force major strategic and operational changes for many organisations who rely on the flexibility afforded by zero-hour contracts to meet volatile demand in 24/7 markets.
The recommendation is the latest to emerge from the government’s various reviews into modern working practices.
The evidence submitted by Working Time Solutions to the Business, Energy and Industrial Strategy Committee’s inquiry into ‘the future world of work’ can be accessed here.
In it we examine how Annualised Hours contracts could play a key role in improving the productivity, pay, wellbeing and job security of the UK’s 3.6 million shift workers.
Annualised Hours could also hold the key for those organisations which have developed a dependency on zero-hours contracts, but which may in the future, be legally bound to offer employees the ‘right to request’.
This resourcing model enables Working Time and pay to be calculated over the course of a year (rather than by the day/week), providing much more flexibility in how those hours are deployed for both employer and employee.
For the employer, labour can be accurately aligned to the anticipated demand over any given period.
For employees, a yearly salary is paid on a regular basis, but hours worked can vary as they are dictated by demand.
Building functionality into the system such as bank hours, standby/stand-down, flex-up/flex-down and varying shift start and end times can provide much of the flexibility afforded by zero-hours whilst also providing predictability for staff – such systems should have reasonable and transparent rules and be designed through staff engagement.
You can read more about this resourcing framework in our report ‘Making Annualised Hours work for the UK'.
Certainty AND flexibility
Annualised Hours systems also open up the potential to design shift patterns and rosters that appeal to a broad range of demographics and lifestyle needs.
Reducing the costs associated with overtime, agency workers and administering zero-hours contracts enables employers to offer a secure and often higher basic salary. This tackles the ‘precarious’ nature of zero-hours and help employees secure credit agreements and mortgages more easily.
Working patterns can also be created that suit different life-stages and lifestyles, ensuring the needs of working families, students or those wanting to work reduced hours as they transition into retirement, can be met.
Crucially, by providing more certainty, fairness and flexibility, employers can differentiate themselves in labour markets, which many predict will become even more competitive following Brexit.
Avoiding admin overload
Whilst the principals behind the rumoured move should be lauded, the ‘right to request’ has the potential to create a serious administrative overhead for organisations.
For any system to work, Working Time will need to be planned and tracked accurately and efficient systems put in place to manage variances such as holidays, absence and shift swaps.
Ultimately technology will have a fundamental role to play in ensuring any new approaches to Working Time remain optimised, compliant and aligned to the needs of employees and employers.