Trades unions are warning Andy Burnham that Labour’s policy on cutting zero-hours contracts risks failing to live up to the party’s manifesto.
Union leaders are seeking reassurances from the business secretary, Jonathan Reynolds, amid what the TUC has condemned as “scaremongering” from business groups.
The unions were alarmed by limitations on who will qualify for new guaranteed hours contracts, mooted in Labour’s recent consultation document on the policy.
Joanne Thomas, the general secretary of shop workers’ union Usdaw, said: “The right to a contract that guarantees the hours you normally work is a matter of basic fairness and security. It must be applied to everyone to deliver the government’s manifesto commitment.”
She added that the policy “must apply to everyone up to and including full-time workers. We absolutely cannot have loopholes that make this meaningless.”
Ross Holden, the head of policy and research at the GMB union, said: “We are concerned that without a major rethink there is a risk this policy is not matching what we said in the manifesto.”
He added that unions are worried about whether their concerns are being given sufficient weight. “If the policy development is one-sided then we risk this being watered down.”
Unite raised a separate concern, about a “regularity requirement” – suggested by the government – which the union claimed would exclude a significant number of workers.
“If the government was attempting to create a right which virtually no workers could qualify for or be able to enforce – they could not have done a better job,” a Unite spokesperson said.
Getting rid of “exploitative” zero-hours contracts is a key aim of Labour’s Employment Rights Act. The Act has already become law, but the zero hours changes are not due to be implemented until next year, and many details have yet to be thrashed out.
A consultation document, published when Keir Starmer was still at No 10, included an upper hours threshold. Workers whose existing contract already guarantees them more than the threshold – which could be set at anything from 8 to 48 hours – would not qualify for the new right to a contract that matches the hours they actually work.
Business groups seized on official estimates published by the government last week that showed the most expansive version of the policy could cost companies up to £2.9bn a year. The British Chambers of Commerce called the prospect “a further hammer blow for many firms struggling to keep their heads above water”.
Kate Bell, the assistant general secretary of the TUC, said that 40% of the upper costs estimate was made up of the compensation employers would have to pay out for cancelling workers’ shifts at short notice. “That assumes no behavioural change by employers,” she said. “It assumes they don’t have the creativity and the experience to adapt their model.”
Bell added that the same document showed irregular and unpredictable shifts cost one in three workers on zero-hours contracts about £3,000 a year.
“We keep having to have the same argument time and time again about the real costs of insecurity for workers,” she said. “Most people don’t want to be on these contracts. They’ve been on these contracts for a long time and it has costs for their mental health and their financial security.”
Reynolds returned to the job of business secretary in Burnham’s wholesale reshuffle last month, after being moved out of the post by Starmer. With the zero hours consultation closing next week, the issue will be one of the first he faces back in post.
A government spokesperson said: “We are absolutely committed to ending exploitative zero-hours contracts, where workers bear all the financial risk when hours, shifts and earnings are unpredictable. These reforms will give workers in every postcode greater income security and predictability of hours.”
The spokesperson added: “While no final decisions have been made, we’re consulting with business and trade unions including GMB, Unite and Usdaw, to get the detail right and ensure this works in the real world.”
