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Businesses should not be vilified over workers' casual contracts


Staff during a Nationwide strike organised by MANDATE  in a dispute over low-hour contracts, job and income security and the right to trade union representation at Stephens Green Shopping Centre, Dublin.

Staff during a Nationwide strike organised by MANDATE in a dispute over low-hour contracts, job and income security and the right to trade union representation at Stephens Green Shopping Centre, Dublin.

Collins Dublin, Gareth Chaney

Staff during a Nationwide strike organised by MANDATE in a dispute over low-hour contracts, job and income security and the right to trade union representation at Stephens Green Shopping Centre, Dublin.

The Dunnes Stores strike over conditions for employees on low hour contracts has highlighted the changing nature of how people work, how they are employed and whether long term stability can be provided to many employees.

Much of the debate has been around the issue of so called "zero hour contracts", which are widely used in the UK, but not necessarily so much in Ireland.

Employment law here means that people on these casual hour arrangements must be paid at least 25pc of the hours they are contracted to be available to work. That can often translate into 15 hours per week. In reality they often end up working and being paid for more hours than that.

In the case of Dunnes Stores, around 1,200 of its staff supplement their income from either Jobseekers allowance or Family Income Supplement.

This is the highest figure in the State apparently, but no doubt is closely followed by other rival retailers.

You cannot simply say these workers are "forced" to supplement their income with social welfare payments because personal circumstances may dictate what way they want to work.

One retailer in a small country town told me recently how she cannot get some of her staff to work five days per week. It suits them to work for two or three days and claim some State assistance for the remaining days.

This employer put it down to a combination of personal/family circumstances and the taxation pitfalls of working full-time.

So how many people on casual contracts would like more hours and how many are happy with what they have got? The Government has asked a team from the University of Limerick to examine this issue.

In the UK, where zero contracts are much tougher, a survey by the Chartered Institute of Personnel and Development found that just one-third of those on zero hour contracts want more hours. That means two-thirds don't.

The problem lies with the lack of certainty around how many hours they will get, and when those hours will be.

Employers argue that these flexible arrangements suit some people who are students, parents or in other personal circumstances. Studies in the UK have found that zero hour workers are more likely to be women or in full-time education, aged under 25 or over 65.

But clearly there are real problems. The part-time worker who has something else to do, or is in transition through education to where they want to go, can put up with this level of uncertainty for a while. They may well welcome it.

If you want to work full-time and are likely to remain in relatively low skilled labour for your working life, then you may want to get as many hours as possible. You want to plan your life, and use some level of stability for simple things like applying for a car loan.

It would be a lot easier for employers like Dunnes to re-examine their rostering arrangements so people got their hours together in blocks, than it would be for them to guarantee numbers of hours per week - which would drive up their cost base.

The prevalence of zero hour contracts in the UK has become an election issue. Labour Party leader Ed Miliband has promised to change the law so zero contract workers are offered a "normal contract" after just three months. It seems unworkable.

Employers could get around it by shifting out of contracts after ten weeks or changing from zero contracts to low hour contracts. It might also leave parts of British business totally uncompetitive.

The issues being laid at the door of Dunnes Stores are in fact becoming a lot more prevalent. Increasingly, people of all educational and skills backgrounds are finding less long-term security and stability in their employment. Old certainties around pensions, terms and conditions, sick pay and having a "job for life" are disappearing. This is as true of trainee doctors, architects and journalists, as it is of retailer workers and bar staff.

There are real problems with this approach. Staff that can be easily picked up and then cast aside means employers have no good reason to invest in making them better and more effective.

There is nothing unfair in these contracts, especially if they suit a lot of people. But it is how they are applied that causes problems.

The easy narrative is that companies are increasingly exploiting workers in order to make ever-larger profits. The reality isn't that simple.

Many companies themselves are in a less secure and more precarious position. Companies that are profitable today can find their entire business model undermined by competition or change very quickly.

The old certainties of job security were based on the old certainty that not a lot would change. Now everything is changing.

Globalisation has created opportunities for wealth but also greater competition. It has also increased the potential workforce around the world by close to two billion people.

It would be stupid to suggest that large companies are continually in a precarious position and not making significant profits. Of course many of them are. Dunnes Stores is one of them.

Employment is becoming a lot more precarious. One University of London professor, Guy Standing, has coined the phrase for this growing group of precarious workers. He calls them the "precariat".

According to Professor Standing, there used to be a proletariat. We all wanted to be in the salariat -namely those with good steady jobs, solid propsects and certainty.

He found those who entered the workforce between the 1960s and the 1980s got the best deal when it came to pay, conditions, job security and stability.

Prof Standing has identified something interesting that many of us can see. However, his argument falls down on how best to solve it.

Indo Business