The Importance Of Zero-Hour Contracts

After the global financial crisis in the 1970s, British labour market experienced a great shift in the organization and the new distribution of human resources. The managers of organizations realized the significance of rising to the occasion in order to remain competitive power, which resulted in the emergence of flexible working systems (Dawson, 2004:95-96). More specifically, zero-hour contracts have been applied. Pardey (2013:6) points out that zero-hour contracts are labour contracts between employers and employees which offer uncertain work and unfixed working hours. According to Tovey (2013), the study from the Chartered Institute of Personnel and Development (CIPD), nearly 3.1% of British labour force has signed this kind of contracts,

All labour markets pay the employees with different amounts of wages in terms of diverse hierarchies, which is more common in flexible labour markets (Dawson, 2004:95). As Stewart (2015) stresses, because of the flexible working system, companies have opportunities to hire more efficient workers. For instance, when a company manager interview two employees, one of them with lower work ability asks for more wages than the other with higher capacity. There is no doubt that the manager would choose the more efficient one (Dawson, 2004:100). This shows that the flexible management offered by zero-hour contracts allows the employers to choose more valuable employees. Because of fierce competition, the employees will easily realize and manage to develop their skills to remain competitive power if they obtain lower wages compared with others. Then the inefficient workers would be driven out of the market due to the loss of competitiveness, which offers employers more chances to obtain valuable workers who can create more profits for the companies. Based on these facts, a conclusion could be drawn that zero-hour contracts could help companies remain competitive advantage because of more opportunities to obtain efficient workers for the long-term

The long-term instability of work would cause less accumulation of income and financial difficulty. In addition, it is difficult for workers with less job guarantee to pay for debts. Furthermore, the difficult financial situation would also affect the well-being of casual workers. On the other hand, some unscrupulous companies treat these workers badly. Sometimes they would face unfounded criticism and the income they gain is often disproportionate to their work which leads to bad job performance. It true that employees’ performance is crucial to the development of companies. Nevertheless, these problems are not completely caused by zero-hour contracts. On the contrary, it results from the lack of protection for casual workers. If the government could introduce corresponding polices to protect the rights of these workers, guarantee the minimum of income and grant subsidies if necessary, then their degree of satisfaction will be enhanced which leads to positive performance towards jobs. Additionally, Tovey (2013) emphasizes that responsible employers would treat their workers fairly. This means unfair treatment is just a rare case. Through proper treatment, employers would also get the most of the employees and reduce the turnover rate. As Hill et al (2010:357) states, flexible working will help both achieve a win-win situation. Therefore, through the good utilization of zero-hour contracts, not only workers will get long-term work security but also the companies