With the negative press surrounding zero-hours employment contracts, David Glover, managing director of Caremark, discusses whether they should be used in franchise businesses
Companies like Sports Direct have given zero-hours contracts a seriously bad name. A zero-hours contract is an agreement between an employer and worker where the employer isn’t obliged to provide minimum working hours while the worker isn’t required to accept any work offered. Many employers use these contracts to mitigate fluctuating staff needs and in much the same way, many people find this level of flexibility to be a suitable way to work, preferable to their circumstances. So, why has there been widespread criticism of the use of zero-hours contracts?
The problem is that, on the surface, zero-hours contracts weigh in favour of the employer. Business owners can avoid paying fixed overheads and have flexibility over their workforce. Without the same employment rights as traditional contracts, workers don’t receive sick pay and there’s no obligation for employers to provide a set number of hours from week to week. A perceived lack of financial stability and security is often played upon in the media, creating a negative and unappealing image around this way of working. Many stories often conflate zero-hours contracts and gig economy working in the same negative boat.
But it’s certainly not all bad and, as with most things, there are two sides to every story. In sectors struggling with recruitment, such as hospitality and social care, zero-hours contracts give employers the chance to showcase how rewarding a long-term career in these sectors could be. Without a person having to commit upfront to a minimum-term contract – something that is often appealing – they can get a taste of what’s in store. So, as long as potential employees can easily read about their rights and what’s included within the zero-hours contract, they can make an informed decision before accepting a role. And don’t forget, just as employers have no obligation to provide hours, the worker isn’t forced to undertake those given. Therefore, a business using zero-hours contracts puts itself at risk of investing time and resources to train workers who days or weeks later, can simply decide it’s not for them and walk away.
At Caremark, if someone chooses to join us on a zero-hours contract, it’s often because those roles fit with their personal responsibilities, academic studies or childcare issues. Many of our care workers on zero-hours contracts work them just like a full-time job with over 30 hours a week and accrued holiday entitlement. They’re still deemed professionals, can engage in National Vocational Qualifications in health and social care and, most importantly, know they make a difference to vulnerable people’s lives on a daily basis. If you create the right team culture, you can engage and train staff to become a valued part of your team.
I think the main message here is that, just because zero-hours contracts tend to be seen as a ‘no frills’ option, that doesn’t mean yours has to be. Think about regularly reviewing hourly rates, providing training so all members of staff deliver to the highest standard and creating an environment for open communication, so that everyone feels part of the team culture. Imagine the reduction in recruitment costs if you could cut staff turnover rates.
Franchises can utilise zero-hours contracts effectively without taking advantage of those workers by adopting a managed approach. Don’t consider them to be unimportant, treat them as you would any member of your team. Our culture of one team one goal ensures everyone is treated with equality values and equity whether they represent our brand for ten hours a week or as a full-time employee.
I believe franchisors, franchisees and in fact any business owner should be able to embrace zero-hour contracts. Used correctly, they can empower all parties.