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Radical Changes Needed to Reduce Zero Hours Poverty in Cornwall

Major changes are needed to reduce Cornwall’s growing dependence on zero hours and similar contracts which are trapping people in low paid work, according to major new research by Citizens Advice.

The report, Proper Job, highlights the vulnerabilities of the county’s economy to low paid, on-demand work in sectors such as tourism and care and suggests some ways to reverse the situation.

Citizens Advice Cornwall Chief Executive, Gill Pipkin, said:

“Our research has found Cornwall has a greater proportion of people employed in these two sectors than the country as a whole and the dependence on these often low wage, insecure and seasonal jobs is growing quicker than the rest of the nation.”

The proportion of the workforce engaged in tourism, for example, is 16.3% compared to 7.6% for Britain as a whole. The increase in employment in this sector was 2.9% in Cornwall compared to 0.3% nationally.

“With the huge impact of lockdown on employment opportunities, we are likely to see an even greater dependence on low paid, insecure work, often  using zero hours or similar contracts as employers seek to minimise labour costs,” added Gill.

The report also shows Cornwall has the highest number of unpaid carers, often family members, which makes it difficult for people to juggle irregular working hours with the need to care for sick relatives.

Citizens Advice Researcher, John McDonald, said:

“We know Cornwall’s economy is highly dependent on traditionally low wage and low skill industries and has been for many years.

“We feel new and bold solutions need to be found if this situation is to ever improve and in our report we have suggested reforms to the benefits system to create a Transferable Personal Allowance, changes to the National Minimum Wage and Living Wage and use of Model Contracts to help those using zero-hours working understand their rights in what has become a grey area for employers and workers.”

The report acknowledges that zero-hours contracts suit some people, especially students and retirees, who appreciate the flexible working they offer, but also points to a great deal of confusion among employers and employees about their rights and responsibilities, with terms such as casual worker, fractional worker, bank staff and flexible work on-call all terms seen by Citizens Advice.

 

PROPER JOB – A REPORT ON ZERO HOURS AND CORNWALL’S UNIQUE ECONOMY

SUMMARY

Research by Citizens Advice Cornwall shows the growth of the “gig economy” is creating significant confusion around different terms of employment added to an increasingly complex terminology.

People we interviewed were unsure what type of contract they were on (zero-hours, flexible, bank, casual and many others) and what their rights were.

Our research also looks at why Cornwall is particularly vulnerable to the use of zero hours and similar contracts because of reliance on sectors that most use casual or flexible employment practices:

  • Heavy reliance on seasonal tourism (16.3% of all jobs compared with 7.6% nationally)
  • Reliance on care work (14% of all jobs compared to 13% nationally)
  • More people acting as unpaid family carers (12% of the population compared to 10% across England) meaning they rely more on jobs offering flexible hours.

Cornwall also has significantly more part-time workers as a proportion of the workforce (39.6% or employees) compared to the UK figure of 32.5%).

Nationally, 4.7 million (mainly low paid) workers now on zero-hours type contracts. While some individuals find the flexibility of this work suits their needs, others find that it has thrust them into in-work poverty. Employers argue that it is an essential part of the gig economy, requiring industrial flexibility for economic growth.

ONS data shows that in 2017, three per cent (900,000) of the national workforce listed their main job as being a zero-hour contract.

These insecure contracts meant workers didn’t know how many hours they were going to work each week, how much take home pay they would receive and consequently, if they could afford the rent or buy food. Zero-hour workers generally earn less than permanent employees and miss out on key employment rights such as family friendly hours, statutory redundancy pay, and protection from unfair dismissal, as they could and were hired and fired at will.

 

KEY CONCLUSIONS AND RECOMMENDATIONS

 

1) For too many of Cornwall’s workforce the facility of commuting out of the county to more prosperous areas for work does not exist.

 

2) The dominant industries in the county enjoy the benefit of a captive workforce and, consequently, no competition for their labour. This allows for a comfortable complacency to determine a lower pay structure which consistently fails to achieve parity with either the South West region or the country.

 

3) Cornwall’s pensioner population is at a higher level than Gt. Britain as a whole. This requires a greater number of the available workforce carrying out informal caring duties creating an imbalance between full-time and part-time workers with many of the latter requiring extremely flexible working arrangements.

 

5) This imbalance between full-time and part-time workers also creates a high dependence on benefits, which have steadily declined in value, and are seen as increasingly difficult to access.

 

6) The growing demand for more and more flexible part-time working arrangements encourages exploitation by new style contracts of employment, which avoid such legal rights applied to formal employment.

 

Proper Job – Zero Hours and Cornwall’s Unique Economy

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