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Zero-hour contracts have long been a contentious issue, with arguments back and forth about why they are or aren’t good for both business and employees. And it looks like an issue that isn’t going away anytime soon. Robert Williams, VP Sales, UK&I, ClickSoftware explains more...

Just recently the Business Secretary Vince Cable announced a ban on exclusivity contracts in a bid to give employees the opportunity to seek additional work elsewhere. It had meant if people were working on zero-hour contracts, they couldn’t seek additional work, inevitably leaving some people short if they didn’t get enough hours from that employer.

So why are zero-hour contracts such a contentious issue and is it simply a case of employers looking to have the most efficient workforce possible?

Well first and foremost it isn’t just an argument around employers being right or wrong to use them. The real point of conversation is how beneficial they are in the long-run. Of course you get the instant saving on resource by reducing your commitment to long-term staffing costs. But what if you sign a big piece of business or a product flies off the shelves faster than you can replenish the stock. The major business around zero contract hours is that they are rarely based on long-term forecasting, leaving companies vulnerable for changes in their market which, with some decent planning, can be accounted for in a good forecasting model.

Now it is also true that you cannot have a bloated workforce that is operating inefficiently just in case resource is needed. I suspect many businesses have been operating this way for years and adopted zero-hour contracts to counterbalance a huge excess in the level of resource and productivity. Yet going from one extreme to the other isn’t the best way to solve this problem. Instead, there should be a middle ground whereby careful analysis is conducted and factored into a detailed resource plan.

This plan could then identify where zero-hour contracts have a continual benefit for both employer and employee. For example, if you are a business which traditionally sees seasonal peaks and troughs in the level of resource coupled with personnel that tend to be short term and high churn, then zero-hour contracts are absolutely a viable option to ensure you have the most optimised staff possible.

For those high churn positions where you know you will see people coming and going in roles, there is little need to go the extra mile to keep them motivated as more often than not, those people will only have a fleeting relationship with the company. Where zero-hour contracts become more problematic is when they are applied to job roles which see less churn and are more skilled. With this sub-set of the workforce, there is an intangible benefit of keeping them engaged and motivated. At the heart of this is fostering an environment where they feel valued and wanted. Identifying this real engine room of the business is where good planning comes into play again.

 

This does entail a central planning function which can identify these incidents and then be capable of implementing the new staffing solutions, but this is something successful companies are doing. Having all of this in place will give you an optimised and diversified workforce that is equipped to change with the market. So if one section needs to be upscaled, then that can be taken from another part of the business where it is less critical.

With this best practice in place the benefits of having an engaged and motivated workforce will become apparent. The days of a job for life may be coming to an end, but you can still certainly engender a sense of loyalty from staff whilst they are there. Planning the way they are deployed and in which roles, is a primary way of doing this.

For employers, the good news is that technology has never been able to offer them more insights than it does today. From timesheets to smart devices, there is a whole range of data that can be crunched and fed into a system that comes up with the best answer. It’s new of course, and not absolutely perfect, but is surely a wiser path to take than simply employing too many people or using zero-contract hours to provide a rudimentary solution on a week-by-week basis.