Zero hours contracts have been unfairly demonised, according to the Chartered Institute of Personnel and Development.

The CIPD today launched its report Zero-hours contracts: myth and reality and said that zero hours workers are more likely to be satisfied with their work-life balance than all employees (65% compared with 58%).

However, speakers at the CIPD’s launch of the report were divided on the issue, with some saying the report raised real concerns about employment trends and the practical experience of employees.

Shadow minister for competitiveness and enterprise Iain Wright said: “Zero hours contracts can work as long as the balance of risk is as evenly shared as possible. But there is a point at which that balance shifts from flexibility to misuse and exploitation and I think the research shows about a fifth of employers are providing these [contracts] where employees would prefer full-time employment.”

While the CIPD’s research found that 80% of employees are not penalised if they turn down work, 38% said they would like more hours than they are given. There is also widespread uncertainty about how zero hours workers are classified under employment law and the rights they hold under their contracts.

The report said 46% of zero hours workers receive no notice or find out at the start of a shift that their work has been cancelled.

While 61% of employers said zero hours staff are at liberty to refuse work, 15% said they are contractually required to be available and a further 17% said that was the case in some circumstances.

Recognising that zero hours contracts are working well for some and not others, TUC head of equality and employment rights Sarah Veale said: “We’ve come to a crossroads. As a society are we prepared to accept the dirty end of the zero hours market?”

Norman Pickavance, former HR director of Morrisons supermarkets, is undertaking an independent review of zero hours contracts for the Labour Party and said he is keen to establish why some companies feel zero hours are essential for flexibility but others in the same sector do not use them at all.

He added that he is concerned “we are moving to a situation where there is a class of workers that we regard as disposable”.

Exclusivity was also an area discussed, with many saying this seems unreasonable for zero hours workers and should be legislated against. However Laura Farnsworth, a partner at law firm Lewis Silkin, which co-authored the report with the CIPD, said this would penalise certain sectors and arrangements unnecessarily.

Ben Willmott, CIPD head of public policy, said it is unclear what could be done to address issues about zero hours through legislation without having unintended consequences, such as pushing employers to use agency workers. Instead the CIPD is recommending that a code of practice is agreed and has produced a guide for employers on the law in this area.

In discussion, the care sector was singled out as an area of real concern, where the social costs of a lack of staff continuity could be heavy.

The CIPD estimates that just over 1 million people (3.1% of the workforce) are on zero hours contracts. Organisations that use the contracts estimate that 19% of their workforce is engaged under zero hours arrangements.

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