‘Zero-hour contracts get some bad press but they help keep companies in business’

By |2019-03-15T10:21:27+00:00March 26th, 2019|Categories: Features|Tags: , , |

Anne Pass, head of HR and business support at Together Travel Co, explains why zero-hours contracts are essential to the company’s survival, and the benefits of flexible contracts for staff

It seems at the moment that barely a month goes by without zero-hours contracts (ZHCs) hitting the headlines – and usually in a negative way. Last month, the TUC slammed ZHCs as “exploitative” and called on the government to ban them altogether.

But, talk to HR professionals, and you’ll find the discussion is much more nuanced. Anne Pass, head of HR and business support at Together Travel Co (formerly Natural Retreats) talks to CIPHR about why the UK holiday company uses these flexible contracts, and why proposed reforms might not be feasible in practice.

 

How does Together Travel Co use zero-hour contracts?

We started using them in 2012 to give us more flexibility in our employment contracts. Our business is very seasonal: the bulk of our bookings are in the summer, and the number of guests can also vary depending on the weather. While a reasonable proportion of bookings are done in advance – in line with school holidays and local events, for example – we do also get last-minute bookings, so we need to be able to flex hours up and down in line with that demand.

 

What proportion of your staff are on ZHCs?

It depends on how you look at it. If you look at pure headcount, about two-thirds of our 130 staff are on ZHCs. But it you look at the average numbers of hours worked, it’s about equal between our staff on ZHCs and employees on other types of contract. Most of the staff on ZHCs work in catering roles – in our storehouses, which are a café operation– and in housekeeping.

 

Broadly speaking, what do your staff think about ZHCs? Would some prefer more stable contracts?

Some like ZHCs because they don’t want too many hours – they fit work around studying, childcare or other caring responsibilities, or second jobs. Some only want to work during the week – our housekeeping roles, for example, are mainly concentrated on Thursdays, Fridays and Saturdays, because that’s when we get the most arrivals. Others simply aren’t available to work full time.

When people come for an interview, we explain the basis of the contract and what it means. We will always try to give team members notice of what we’re likely to need from them the following week, but sometimes we can need them to work a bit more – if we have more guests than expected – or a bit less, if bookings are cancelled.

A lot of people on ZHCs will work with us during the summer and then come back the following year, so they clearly enjoy it. In some cases we can retain people over the winter months, but on reduced hours or in slightly different roles.

 

What career progression opportunities do you offer to staff on ZHCs?

Some people have moved on to more stable contracts, though we’ve found that many don’t want the additional responsibility that progression may bring.

It can also be difficult for us to offer the right opportunities to those who do want to move up the ladder because our locations are spread out across the UK. So if someone has family or commitments in their local area, they might not want to move from Cornwall to the Outer Hebrides, for example. One of our housekeepers has progressed to an assistant general manager position, but we were fortunate that she was prepared to move locations.

 

The Taylor review of modern working practices recommended that a higher national minimum wage (NMW) rate should be introduced for hours that are not guaranteed as part of an employee’s contract. What’s your view on this proposal?

The difficulty with this proposal is, what if you have two people doing the same job – one is perhaps a seasonal worker on a ZHC, the other is on a permanent contract – and they do the same job but one receives a higher wage? How do you deal with that from an equal pay perspective? I appreciate one has a different level of job security, perhaps, but at the moment that isn’t an accepted rationale within an equal pay claim.

 

Do ZHCs warrant the bad press they continue to receive?   

Some companies probably don’t operate them very fairly. But many companies use them in order to be sustainable and remain open. If you were having to give people a specific number of hours, it might mean you either give three people six hours each, for example, or six people three hours each. Any business has to be able to make money to maintain jobs for existing staff and possibly expand and provide more jobs. In the last few years, businesses in the retail and hospitality sectors in particular – which operate on very low margins – have seen massive increases in labour costs due to NMW rises and increased rates for pension schemes. Restricting the use of ZHCs would hinder some companies’ ability to survive.

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