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Zero hours plans fail to protect low-paid workers, says LITRG

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Responding to the government’s proposal to outlaw ‘exclusivity’ in zero hour contracts and increase transparency, the Low Incomes Tax Reform Group (LITRG) has argued that the proposals fail to grasp what is actually needed to bring sustainable protection for low paid workers on zero hour contracts. The LITRG maintain that the problems low paid workers face are more often than not  to do with poor support from the system, rather than the actual contracts themselves. In the recent consultation by the government on the use of zero hours contracts, the LITRG in its response drew  attention to the ways in which such contracts interact with the employees’ tax, NIC position, related tax credits and welfare entitlements.

LITRG chairman Anthony Thomas said: ‘Against the backdrop of the government’s labour market strategy, we can see this is a much more complex issue than just banning zero hours contracts outright. In any case, the nature of the enquiries we have received from the public suggests that the problems faced by low paid workers are often more to do with insufficient support and information than the actual contracts themselves. Our response recommends changes to those parts of the system within our remit (tax, tax credits and benefits) that can put workers on zero hour contracts at a particular disadvantage.

‘Great care needs to be taken over such details in order not to put workers at a disadvantage. Our response makes recommendations on these and other matters in the form of practical measures that can be taken relatively quickly to help ease the position of a low income zero hours worker. We also recommend a comprehensive review taking into account the tax and benefit interactions, with a view to better protecting low paid workers in the long term.’

Issue: 1210
Categories: News , Employment taxes