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Vince Cable: Exclusivity clauses for workers 'offensive'

Vince Cable has said clauses in zero-hour contracts that ban workers from jobs with other employers are "offensive".

Dr Cable told Radio 4's Today programme: "What happens is that people turn up for work under a zero-hours contracts, they’re not guaranteed any work, but they’re banned from working for other people...I think it’s that aspect of it that was offensive and constituted an abuse that we want to stop."

Vince Cable called exclusivity clauses 'offensive'.

The Business Secretary is bringing forward plans to outlaw these 'exclusivity clauses', although he has said that the broader idea of zero-hours contracts can be "perfectly sensible" for some workers.

Read: Banning exclusivity clauses 'misses bigger picture'

Banning exclusivity clauses 'misses bigger picture'

Britain's biggest trade union has criticised the Government's decision to only ban exclusivity clauses in zero-hours contracts.

General Secretary Dave Prentis said zero-hours workers were unable to secure credit, loans, or mortgages because of the uncertainty created by the employment tactic.

Banning exclusivity clauses misses the bigger picture for workers on zero hours contracts.

They leave workers not knowing day to day, week to week, what work they will get and what money they will have coming in.

It makes planning impossible and leaves workers unable to get credit, loans, mortgages or rental agreements. The uncertainty damages their family life and health and well-being.

– Dave Prentis

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Exclusivity clauses in zero-hours 'rigid and archaic'

Tying workers to one business when they are employed on a zero-hour contract is "rigid and archaic", according to a business chief.

Director general of the Institute of Directors (IoD), Simon Walker, came out in support of Vince Cable's move to ban the use of exclusivity clause but allow businesses to continue to use zero-hours contracts.

The IoD has long campaigned against the exploitation of employees on zero hours contracts. Tying an employee into an exclusivity cause can turn a flexible contract into a rigid and archaic one.

The whole point about the flexibility offered by zero hours contracts is that they allow an individual to capitalise on their own time, labour and energy.

We're pleased that the Government recognises the enormous value that flexible contracts can bring to both employer and employee, but at the same time it's right to ensure that exploitation is stamped out.

– Simone Walker

Govt clamps down on 'exclusivity clause' in zero-hours

The Business Secretary has hit out at "unscrupulous employers" who abuse the exclusivity clause in zero-hour contracts, tying workers to one company.

Read: Concern over zero-hour contracts for jobseekers

Worker
Vince Cable refused to rule out the use of zero-hours contracts entirely. Credit: PA

Vince Cable announced a clampdown on employers who take on staff with no promise of hours or benefits, and insist they work for no one else.

Despite calls from unions to ban zero-hours contracts outright, Mr Cable said the controversial practice had a place in the labour market - offering working opportunities especially for students and older people.

However, an estimated 125,000 zero-hours workers will benefit from the exclusivity clause ban as they can now look for additional work without fear of losing their current employment, the Business Department said.

A recent report by the Office for National Statistics estimated that employers held 1.4 million contracts that did not guarantee a minimum number of hours.

Read: Miliband promises new zero-hours contract rights

Zero hours leave some workers 'feeling vulnerable'

Lack of clear information and exclusivity clauses in zero hours contracts can leave employees "feeling vulnerable", the Business Secretary has said.

Vince Cable said Acas' research supported what the Government had found in their review of zero hours contracts:

Whilst zero hours contracts work for some, the use of exclusivity clauses and the lack of clear information can leave employees feeling vulnerable.

That is why I launched a consultation last autumn which looked into the issues of transparency and exclusivity in the use of zero hours contracts, to ensure people are getting a fair deal.

I want to make sure those looking to work flexibly under these types of contracts understand their rights and are not prevented from topping up their income by being tied exclusively to one employer. We will publish our response to the consultation shortly.

– Vince Cable

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Workers 'did not even know' they were on zero hours

Many workers "did not seem to even know" they were employed on zero hours contract, with some believing they were permanent staff because of their length of service, a study has shown.

Data from conciliation service Acas showed workers on zero hours often experienced deep seeded insecurities about their long-term employment prospects.

Acas chairman Sir Brendan Barber, said:

A lot of workers on zero hours contracts are afraid of looking for work elsewhere, turning down hours, or questioning their employment rights in case their work is withdrawn or reduced.

This deep rooted "effective exclusivity" can be very damaging to trust and to the employment relationship.

There also appeared to be a lack of transparency on the terms of their contractual arrangements.

Many people did not seem to even know that they were on a zero hours contracts and some believed they were on a permanent contract due to the length of their service.

– Sir Brendan Barber

Zero hours workers afraid to job hunt

Employees on zero hours schemes are too afraid to search for a new job and feel excluded from the sense of security other full-time workers enjoy, a study has shown.

Read: Concern over zero-hours contracts for jobseekers

Zero hours
Workers on zero hours are too afraid to look for work elsewhere because they already feel committed to one employer, the survey showed. Credit: PA

Conciliation service Acas said it was receiving around 70 calls a week about zero hours contacts, and a feeling of "effective exclusivity" of being tied to a single employer was emerging as a major concern.

Their data showed many zero hours workers experienced "a deep sense of unfairness and mistrust".

The Government has been consulting on the use of zero hours contracts amid calls from unions and campaign groups to have them banned.

Labour has pledged to tackle abuses of zero hours contracts if it wins the next general election.

Read: Miliband promises new zero-hours contract rights

Concern over zero-hours contracts for jobseekers

File photo of a Job Centre Plus branch Credit: PA Images

Jobseekers could face temporary benefits bans if they refuse to accept some forms of zero-hour contracts under welfare reforms from the coalition government.

Claimants risk losing payments for more than three months if they fail to accept certain positions on such terms as part of the new universal credit system.

Employment minister Esther McVey outlined the change in a letter to Labour MP Sheila Gilmore in an exchange about benefits sanctions, according to the Guardian.

Jobcentre "coaches" will be able to "mandate to zero-hours contracts" if they consider the role is suitable for a claimant, the letter added.

1.4m employees with no guarantee of minimum hours

About 1.4 million workers are on contracts that do not guarantee a minimum number of hours, a study by the Office for National Statistics has revealed

The estimate includes all those contracts under which some work was done during a two-week period between late January and early February 2014.

About 13% of employers surveyed reported use of NGHCs. Credit: Richard Pohle/The Times/PA Wire/Press Association Images

Non-guaranteed hours contracts (NGHCs) include, but are not exclusively, “zero-hours contracts”, as they also include some other contract types that do not guarantee a minimum number of hours

About 13% of employers surveyed reported use of NGHCs, including almost half of all businesses in the tourism, catering and food sectors.

More than one in five employers in health and social work reported using them, although they were found to be relatively rare in financial and professional services and the manufacturing, energy and agricultural industries.

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