Friday, 25 April 2014

Zero Hour Debacle

With the Coalition government doing quite well, Ed Miliband is really struggling to make any political ground in opposition (his party probably will get the most seats next year, but that's not to do with anything good he's brought to the table).

His latest tactic is to try to pillory zero hour contracts in an effort to make him sound like he's on the side of struggling people. His proposal isn't to ban them, it is to legislate to ensure that:

"Workers can demand a fixed-hours contract when they've worked regular hours over six months for the same employer. And they will they receive a fixed-hours contract automatically when they've worked regular hours for more than a year - unless they chose to opt out"

This is both inconsistent and myopic. It's inconsistent because if Miliband thinks zero hour contracts are bad for everyone then he should want them to discontinued. If he thinks they're good for some people, he is impelled to leave people's working arrangements to those involved in the arrangements, and not impose any extraneous (and arbitrary) regulations of the above kind. And it's myopic because the imposition of 6 month and yearly thresholds won't help the people working under those conditions that he's trying to protect, it will simply encourage employers to lay off employees just before the deadline to circumvent any contractual obligations.

As daft as Miliband has been here, the big annoyance though, as usual, is when politicians meddle when they are not wanted. When the Institute for Economic Affairs surveyed people working under zero contract hours they found over 50% of people found them beneficial, with 30% not liking them, and the rest not minding much.

But even if we don't read too much into surveys (and sometimes it’s not good to), the usual rule of thumb still supplies - governments should not interfere in the allocation of resources in voluntary transactions because they cannot do it better than those actually involved of their own volition. Thousands of people work under zero hours contracts - most of whom are people who've preferred them to the alternatives. A lot of people I know find them ideal for their circumstances - they suit all kinds of people; students, semi-retired people, and the many who want to earn cash but not be tied down.  It's a shame that some politicians in this country are getting so nannified that they are nearly blind to the qualities of a flexible, free market, and hopelessly unmindful of people's liberty to manage their own affairs.

* Picture courtesy of The Sunday Times