Unions worry Labour’s plan for zero-hours contracts may break manifesto pledge

Labour's proposed changes to zero-hours contracts have sparked concerns among trade unions, who fear the policy might fall short of the party's manifesto commitments. Union representatives are urging Business Secretary Jonathan Reynolds to provide clarity over how the reforms will be implemented, particularly regarding eligibility criteria for the new guaranteed hours contracts. The Trades Union Congress (TUC) has criticized business groups for spreading alarmist rhetoric, while unions argue that current proposals contain loopholes that could undermine the intended protections for workers. The controversy stems from a consultation document released earlier this year under former Prime Minister Keir Starmer's leadership. This document outlined potential restrictions on who would qualify for the new guaranteed hours contracts. According to the proposal, workers whose existing contracts already guarantee more than a specified hourly threshold, ranging from 8 to 48 hours, would not be eligible for the new rights. This has raised alarms within the union community, with some fearing that the policy may not fully align with Labour’s stated goals. Joanne Thomas, general secretary of the shopworkers' union Usdaw, emphasized the importance of ensuring that the new contract provisions apply universally. She stressed that the right to a contract reflecting normal working hours should extend to all employees, including full-time workers. “This is a matter of basic fairness and security,” Thomas said, adding that any exclusions could render the policy ineffective. Ross Holden, head of policy and research at the GMB union, echoed similar concerns, noting that the current framework risks diverging from Labour’s manifesto promises. He highlighted the need for a comprehensive review to ensure the policy reflects the party’s initial intentions. Holden warned that if the development process lacks balance, the final implementation could significantly dilute the original vision. Unite, another prominent union, voiced additional concerns about a proposed “regularity requirement.” The union argued that this condition could disqualify a substantial portion of the workforce from benefiting from the new measures. A Unite spokesperson described the situation as potentially undermining the very purpose of the reform, stating that the government had crafted a system that few workers could realistically access or enforce. The Labour Party's Employment Rights Act aims to eliminate what it describes as exploitative zero-hours contracts. While the legislation has already passed into law, the specific changes related to zero-hours contracts are scheduled for implementation next year. Many aspects of the policy remain unresolved, prompting ongoing discussions and consultations. Official figures suggest that the most extensive version of the policy could impose annual costs of up to £2.9 billion on businesses. The British Chambers of Commerce expressed concern, describing the financial burden as an additional challenge for firms already grappling with economic pressures. However, TUC assistant general secretary Kate Bell pointed out that a significant portion of these estimated costs relates to compensation for cancellations of workers' shifts at short notice. She noted that these calculations assume no adaptation by employers, despite their capacity to innovate and adjust their operational models. Bell also highlighted the financial impact of irregular and unpredictable shifts on workers, estimating that such conditions cost approximately £3,000 annually per affected individual. She reiterated the need to address the long-term consequences of job insecurity, emphasizing its effects on both mental health and financial stability. As the consultation period approaches its close, Reynolds, recently reinstated as business secretary following a cabinet reshuffle, faces the task of addressing these concerns. His return to the role comes at a critical juncture, with the zero-hours contract reforms poised to be among his immediate priorities. A government spokesperson reaffirmed the commitment to eliminating exploitative zero-hours contracts, underscoring the goal of providing secure employment opportunities for workers across the country.