It’s been stated that job-seekers who refuse to accept zero-hours contracts – a commitment to work for an employer which may or may not lead to paid work – are liable to sanction, which means that their benefits will be stopped if they do not accept.
When the National Insurance system was founded, more than a century ago, many workers worked ‘casually’, which meant that they would present themselves for work in the morning and if there was no work, they went home with no pay. The way that the system used to deal with this was that unemployment benefits were paid on a daily basis. When an unemployed person signed on, they would identify which days they had worked on, and which they had not. If people had worked in any day, receiving more than £2 (a minimal level, they lost their benefit for that day, but could keep it for the other five days of the week. There were special rules for people whose ‘full extent normal’ was less than six days a week. These rules only disappeared in the 1990s, when the daily rate was replaced by a weekly assessment.
Zero-hours contracts are not a new idea; they’re a continuation of a very old form of working practice. Unfortunately, the benefits scheme that was designed to protect people who were working casually no longer exists, and there are some benefit rules which could create serious problems – for example, the assumption in fraud investigation that all existing work is remunerative, and the new rules for self-employed people which assume they have at least a minimum wage. There is, however, the potential for a simple rule which could make a large difference. It would be perfectly legitimate to say that if employers want people to hold their services on a retainer, they must pay the minimum wage for any period during which the services are retained. If employers can’t afford to do that, they can’t hold people to a contract.