Sanctions and Zero Hours Contracts

Under Jobseekers Allowance, claimants are able to refuse job offers involving zero-hours contracts and avoid being sanctioned. This was set out in a response to a Freedom of Information request which included the statement:

Jobseeker’s Allowance claimants are not required to apply for zero hours contract vacancies and they will not face sanctions for turning down the offer of a zero hours contract.

However I’m concerned that this could be set to change under Universal Credit, following another response to an FOI request, which includes the statement:

We expect claimants to do all they reasonably can to look for and move into paid work. If a claimant turns down a particular vacancy (including zero hour contract jobs) a sanction may be applied but we will look into the circumstances of the case and consider whether they had a good reason.

On 10 February 2014 I wrote to the Secretary of State for Work and Pensions Ian Duncan Smith to seek clarification – you can see my letter here. I received a response from Esther McVey, Minister for Employment at the DWP, dated 1 March 2014 – again you can find it here.

The Minister states that, at present, DWP don’t require JSA claimants to apply for zero hours contracts because short periods of work could end a JSA claim, requiring new claims to be made in periods where earnings fall. However this will change under Universal Credit. Ms McVey justifies this as follows:

Universal Credit is payable when people in work as well as out of work so the need to reclaim when earnings fluctuate is removed. In addition Universal Credit is designed to be responsive to variations in earnings to each monthly payment will reflect the amount actually earned, even if this includes some weeks when no work was done.

The Minister concludes by emphasising that ‘the coach should still consider whether the role is suitable for the individual’ and, when considering sanctions, Decision Makers should take into account the reasons claimants give for not taking particular jobs. I’m concerned that this isn’t happening under JSA at present, and so while I don’t object to the principle of either Universal Credit or zero-hours contracts, I am concerned about this policy change. I also fear that if people are required to take jobs with zero-hours contracts, they could be prevented from taking training courses or applying for other jobs that might lead to more stable and sustainable employment in the long term.