research-report-96-coming-clean-contractual-and-procurement-practices.doc

The growth in use of zero hours contracts may be

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The growth in use of zero hours contracts may be linked to changes in the balance of power in the labour market and individual employment relationships since the recession, as we discuss below. One specific factor in the recent growth in zero hours may be the introduction of the Agency Worker Regulations in 2011 (see below). Since agency workers now have to be offered the same terms and 18
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THE LABOUR MARKET FOR LOW-WAGE WORK IN BRITAIN conditions as regular staff after twelve weeks of working, employers may be considering that agency workers offer few advantages over directly hired casual workers on zero hours, particularly as agency fees can thereby be avoided. 3.2 Indicators of vulnerable work Several indicators suggest the recovery from recession is reinforcing vulnerability for many groups in the labour market, especially those in low-wage segments, defined by type of occupation, sector or workplace. Low pay One of the peculiar features of the British labour market in the last decade is that despite a rising relative value of the statutory minimum wage, the share of workers in low paid employment has stayed roughly the same. Using the international definition of low pay as less than two thirds of median gross earnings for all employees, the UK has recorded a 21-22% share of employees in low-wage work since the late 1990s. At the same time, the minimum wage has risen in relative terms during 2001- 2013, both against median earnings (from 45% to almost 55%) and mean earnings (from 34% to 41%), although with a notable slow-down in the rise since 2007. As is well known, female part-timers are most at risk of low pay in the UK. Of the 5.2 million female part-time employees registered in 2013 5 , the earnings data suggest more than two in five (around 41%) were in low-wage employment; that is, approximately 2.1 million female part-time employees earned less than £7.71 per hour. As such, the battle against low pay must first target the problems facing low- paid female part-time workers. 5 ONS Labour market statistics, March 2014 release. 19
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COMING CLEAN: CONTRACTUAL AND PROCUREMENT PRACTICES Figure 3.3 Trends in low pay and the relative value of the national minimum wage Source: authors’ graphic based on ASHE gross hourly pay data (excluding overtime, all employees); and authors’ estimate of % in low-wage employment using published decile ASHE data. 20
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THE LABOUR MARKET FOR LOW-WAGE WORK IN BRITAIN Weak union representation Low levels of trade union representation prevent many workers in low-wage segments from effectively bargaining for higher pay. Among both men and women, union density in the UK is low by international comparison at 23% and 29%, respectively. As well as the higher level among women it is also significant that overall/male union density has fallen relatively consistently since 1995 while among women it has held steady. 6 The reason is largely women’s higher union density among professional occupations than men’s (mostly in the public sector).
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