Zero hour contracts and your business in 2016 (Part 2 of 5)

By Sam Thomas | 18th January 2016 | 3 min read






Here is blog number two in our five-part series looking into the key issues which we believe could affect your business over the coming 12 months. If you missed part one where we looked into the upcoming introduction of the National Living Wage, you can read it here.

Zero hour contracts have been in the news a lot recently and 2016 is likely to be no different. More often than not, coverage is largely negative – is this fair? Business managers claim that they offer both their business and their employees flexibility to work at times which suit them, whereas trade unions and some employees explain how the contracts leave them without a guaranteed income and unsure of what the future holds for them and their job.

Whatever your position on them, they have become an almost taboo subject amongst big business in the UK. They’re certainly not illegal, businesses such as Sports Direct and McDonald’s are well publicised users of zero hour contracts, but they are huge corporations with revenue amounts in the billions.

To the small business owner, who may employ just a handful of employees, there is probably a better relationship between owner/management and their staff and therefore, are the contracts better suited to smaller organisations?

The issue which may affect small and medium-sized businesses (SMEs) is that the contracts are not viewed the most positive of light by the public. Whilst they are legal and often used by large businesses, these larger organisations usually take a slight backlash and come out the other end only slightly worse off. Smaller companies may struggle if local communities and perhaps further saw their use of zero hour contracts as a negative thing, as is often the case.

The use of the contracts has to be thoroughly thought out by the business as the possibility of a negative outcry if the use of the contracts came to light must also be assessed.

Another area that has been viewed with a mixed response is the introduction of workplace pensions, especially to the smaller business. Between now and 2018, 1.8 million businesses are going to have to comply with the legislation and enrol eligible employees into a pension. This has been seen as a burden on some SMEs as some view the extra cost as stretching their costs even further.

A benefit of auto enrolment is that it makes joining a workplace pension much easier. Employees feel more settled knowing that they’re saving for their future in a day and age when we’re all living longer, healthier lives. Research has shown that businesses with a good pension scheme find it earlier to attract and keep the best staff, as offering a good company pension is a sign that the employer is prepared to make long-term investments in their staff.

The IRIS AE Suite™ has been developed through the close relationships with pensions providers and The Pensions Regulator as well as customer feedback. The solution works within your payroll and is not a ‘middleware’ solution. With over 5,700 customers assessing over 559,000 employees you can relax in the knowledge that the IRIS AE Suite™ will deliver push button automation, taking the admin and stress out of automatic enrolment compliance.

You can find out more about the IRIS AE Suite™ with a free demo or register for one of our free and informative webinar sessions.