Are employers moving away from zero-hours contracts?

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As part of a growing trend amongst some larger employers, McDonald’s (one of the biggest users of zero-hours contracts in the UK) is to offer 115,000 of its UK workers the option of moving from zero-hours on to contracts with a minimum number of weekly guaranteed hours.

McDonald’s has trialled the changes over 23 sites and has reported that around 8 out of 10 of workers in the trial chose to remain on the flexible, zero-hours contracts.  Staff were offered contracts in line with the average hours per week they usually work including contracts of four, eight, 16, 30 or 35 hours a week. The company plans to roll the changes out nationwide later this year stating, “The vast majority of our employees are happy with their flexible contracts, but some have told us that more fixed hours would help them get better access to some financial products.”

Other employers, notably Sports Direct, Homebase and Wetherspoons, have adopted a similar approach. Sports Direct recently announced it would offer zero-hours employees the opportunity to switch to permanent contracts providing at least 12 guaranteed hours per week.

Employers currently utilising zero-hours workers will be following these developments with interest and this certainly an area for strategic HR thinking. For example, McDonald’s reported that employee satisfaction levels increased significantly after the trial was announced notwithstanding the fact that only 20% of workers in the trial opted to move onto the fixed hour contracts.

If you would like any advice on this issue please contact David Smedley or Andrew Rayment.