Workers on zero hours contracts earn £1,000 a year less than other employees doing the same job, a study reveals today.
People on the controversial contracts, under which they don’t know if they have work from one week to the next, face a “precarious pay penalty”, according to the Resolution Foundation.
The difference is around 6.6%, or 93p an hour, but those in the lowest paying jobs receive 9.5% less, research by the think-tank found.
The widespread use of zero hours contracts forces down wages across the economy, it adds.
Resolution Foundation senior policy analyst Laura Gardiner said: “Zero hours contracts have hit the headlines in recent months for their widespread use in Sports Direct and JD Sports.
“But concern about the use and abuse of zero hours contracts goes far wider than a few notorious firms. There is mounting evidence that their use is associated with a holding down of wages.
“While some people value the flexibility offered by zero hours contracts, they also carry a significant precarious pay penalty that can cost workers around £1,000 a year – that’s a big price to pay for work that too often lacks the security workers desire.”
TUC general secretary Frances O’Grady added: “Zero hours workers suffer the double whammy of lower pay and fewer rights at work.
“Far too many workers have no power to stand up to bad bosses.”
But Business Department spokesman insisted: “As the Prime Minister has made clear, we are determined to build an economy that works for everyone and to help working people who are struggling to get by.
“All workers, whether they are temporary or on a zero hours contract, are entitled to receive at least the national minimum wage, and the national living wage for those aged 25 or over.”