‘How job flexibility boosts part-time employment’

peter cheese

peter cheese

Part-time contract employees in the United Kingdom, on average, experience similar levels of job satisfaction with employees on permanent, full-time jobs, a new report conducted by Chartered Institite of Personnel and Development (CIPD) has revealed

The report also disovered that contract or Zero-Hour employees report comparable satisfaction levels in their relationship with their managers and colleagues.

The report explained that majority of contract employees choose to work part-time, adding that contract employees has increased from one million in 2013 to 1.3 million in 2015.

Other key findings from the research, which draws on data from the ONS Labour Force Survey, the CIPD’s Employee Outlook survey and Labour Market Outlook surveys include: The mean personal well-being score (on a scale with a minimum of zero and maximum of 40) is 26.2 for zero-hours contract employees, compared to 25.6 for all employees (employees with all types of contracts and working arrangements).

The proportion of zero-hours contract employees who are either very satisfied or satisfied with their jobs is 65%, compared to 63% for all employees. Zero-hours contract employees are also more likely to say they have the right work-life balance (62% compared to 58% for all employees) and less likely to feel under excessive pressure at work every day or at least once or twice a week (32% compared to 41% for all employees)

Nine in ten part-time zero-hours employees (88%) say they choose to work part time but 22% of these part-time zero-hours contract employees would like to work more hours, compared to 18% of all voluntary part-time employees.

Also, the report presents the first comparable data for employees on short-hour contracts (those where employees are guaranteed up to 8 hours work per week) and shows that short-hours employees have an especially positive view of their situation with 74% agreeing they have the right work-life balance. Also, just 14% feel under excessive pressure at work at least once or twice a week, compared to 41% of all employees.

Chief Executive of the CIPD, Peter Cheese, said: “Zero-hours contracts are becoming a permanent feature of the UK labour market, but they are often characterised as offering low-quality work on unfair terms which is inferior to permanent, full-time contracts.

“Our research shows that zero-hours contracts employees don’t always see their jobs in such a negative light. On average, they find their jobs as satisfying as other employees, which suggests that zero-hours contracts offer positives as well as negatives.

“One positive is the flexibility they can offer to employees who otherwise may not be able to find work that suits them, but less involvement in the workplace may be a negative. That’s why it’s important to understand that this type of working arrangement may not suit everyone.

“What our report highlights is that the contract type isn’t usually the main factor driving someone’s job satisfaction. How people are managed, the workload they are under and their relationship with their line manager are, usually more important. We all want to see better working lives for everybody but if we simply focus on zero-hours contracts as the source of poor quality working lives, we risk ignoring the bigger systemic issues which create low skilled and low quality work.”

The report also points to areas where there is room for improvement in how employers use zero-hours contracts, particularly in terms of career progression and involvement. Less than half (43%) of ZHC employees feel fully or fairly well-informed about what is going on at work, compared with 56% of all employees. Also, a higher proportion of ZHC employees see fewer ways to progress and improve their skills, despite 82% of employers saying their ZHC staff are eligible for training and development.

The CIPD does not believe the available evidence provides enough justification for going beyond the ban on exclusivity clauses already enacted. It does argue that greater transparency on employment status is required and that some employers still need to develop proper, written procedures covering the cancellation of work and termination of a contract. Employees are currently entitled to a written statement of their terms and conditions within two months of commencing employment and the CIPD recommends a change in the law to extend this entitlement to all workers.

Chief Economist at the CIPD, Mark Beatson, said: “In the operation of zero-hours contracts, as in all forms of employment, there is scope to improve practice. The key principle for the effective and ethical use of zero-hours contracts is that, wherever possible, the flexibility they offer should work for the individual as well as the employer. Well-managed zero-hours contracts can be an effective means of matching the needs and requirements of modern business and modern working lives, but as the numbers continue to rise, it’s important that employers understand how to make this match. And we’re seeing an increasing number of people on zero-hours contracts for long periods, years in some cases, so getting this match right is more important than ever.”

Asking rhetorically, CIPD it its report said: “Does the flexibility they provide work for both the organisation and employees?
“Are they right for your business? Employing staff on zero-hours contracts is about more than addressing supply and demand, you’ll need to consider whether they’ll strengthen your working culture and enhance your employee brand. If there are doubts, consider alternative means of providing flexibility.

“Do you have the capabilities in place to train line managers to manage zero-hours contract staff in line with their employment status?

“Without the necessary management practices in place, those on zero-hours contracts are likely to face problems understanding their role, improving their skills and integrating into the workforce.

“Employees on zero-hours contracts should receive comparable rates of pay to other staff doing similar work.
“Spend time drawing up zero-hours contracts and understanding what they mean for you and the individual. All employees should receive a written copy of their terms and conditions regardless of their contract type. You should consider what compensation you would offer if pre-arranged work is cancelled at little or no notice, and plan to conduct regular reviews to check that the reality of the employment relationship matches the contract .

“Employers generally use zero-hours contracts for a relatively small proportion of the workforce. If you plan to put the majority of your workforce on zero-hours contracts, are you prepared to explain your reasons to them and other stakeholders”?

Meanwhile, CIPD has blamed growing gap between boardroom and workforce as major factor responsible for the demotivation of staff.

According to CIPD, the upward “momentum of chief executive pay” and reward in the UK’s largest organisations has reached a crisis point.
CIPD explained that the development “does not clearly correlate to personal performance or business outcomes and this is having a significant impact on the motivation levels of the wider workforce”.

The research, which includes a survey of employee attitudes on Chief Executive Officer (CEO) pay, an in-depth literature review and focus groups and interviews with members of the finance, Human Resource (HR) and investor communities, explores the behavioural factors that are causing executive pay to spiral and the impact that this is having on the workforce.

The employee survey, highlights that seven in ten (71%) employees believe CEO pay in the UK is ‘too’ or ‘far too’ high, Six in ten (59%) employees say the high level of CEO pay in the UK demotivates them at work, more than half (55%) of employees claim the high level of CEO pay in the UK is bad for firms’ reputations, 45% believe their own CEO’s pay is too high, with a further 30% saying they don’t know and just 4% say their CEO’s pay is too low.

The report revealed that only a third (32%) of employees agree their CEO is rewarded in line with their organisation’s performance, with two-thirds saying they disagree (38%) or don’t know (29%).

CIPD reward adviser, Charles Cotton, said: “The growing disparity between pay at the high and lower ends of the pay scale for today’s workforce is leading to a real sense of unfairness which is impacting on employees’ motivation at work. The message from employees to CEOs is clear: ‘the more you take, the less we’ll give’. At a time when the average employee has seen their salary increase by just a few percentage points over the last several years, we need to take a serious look at the issue of top executive reward.

“It’s crucial that chief executive reward packages are simpler and more clearly aligned to both financial and non-financial performance measures. These should include how their leadership impacts on critical outcomes such as employee wellbeing and engagement, accountability for culture and behaviour, and workforce development, all of which are vital underpinnings of the long-term health of both people and business.”

The report highlighted the challenges and how they can be addressed, noting that CIPD recommends that the Government requires all publicly-listed companies to publish the pay ratio between the CEO and the pay of average full-time employees.

The report said: “This will help encourage accountability and prompt a greater focus on this issue among key stakeholder groups such as investors who can help to drive change and hold businesses and senior individuals to account.

“Overly complex performance measures: The report suggests that significant changes need to be made to how bonuses and long-term incentives are structured and why they are paid out. Both of these forms of variable reward tend to be overly complex, and disproportionately focused on financial goals rather than being linked to other outcomes and stakeholders interests, including those of the employees.
“In addition, existing long-term incentives may not motivate because they are predominantly linked to financial measures, which are often affected by factors outside the control of CEOs, such as the economic cycle”.

Making reference tp powerful personalities, the report said: “ The CIPD recommends that organisations increase their focus on ensuring CEOs bring a balanced leadership style, appropriate to the culture and context of the organisation. The report also highlights that top leaders will tend towards more overly confident and assertive behaviour profiles, which also makes them adept at negotiating a higher pay and reward package.

“However, it’s also noted that the real driver in these cases is more about status and recognition than it is about the need for absolute amounts of money.

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