Tackling the part-time pay and progression penalty

Two events on part-time work this week highlighted the importance of enabling more high quality part-time roles with career progression.

Should zero hours contracts be banned

 

How do we create better quality part-time jobs that address the problem of the growing gap between hourly and weekly pay for low-paid and higher-paid workers?

A Resolution Foundation event this week explored the issue of how part-time work, as currently configured, contributes to wealth inequality. The think tank has just published a report on this and researcher and economist Louise Murphy outlined the main thrust of it. She said falling working hours are generally viewed as a sign of economic progress in wealthier countries. The problem is that the UK has a big gap between the lowest and highest paid, with the lowest paid working the shortest hours. This affects people’s living standards.

Minimum wage increases over the last years have seen hourly rates rise by 27% over the last five years, said Murphy, adding that the problem is more about weekly than hourly pay. She stated that, although the proportion of employee jobs that have low hourly pay has fallen by 10% since 2015, the proportion of jobs with low weekly pay fell by just 4%, with women more likely to work in low paid part-time roles.

Before the pandemic women’s working hours were rising, with more women working full time. Yet Murphy said part-time work has many positives in terms of wellbeing and allows for more family time for those with caring responsibilities. In fact, despite the cost of living crisis, many of the people she spoke to said they valued work life balance more than their income. The issue, she stated, is that there is the concentration of part-time work in lower paid sectors and the lack of progression from those jobs. Women are most affected by issues connected to childcare costs and availability, but there are other reasons people find themselves in low paid, unfulfilling part-time work. Moreover, said Murphy, much of the part-time work available is insecure, which makes it risky to change jobs and progress and also to take on more hours if those hours cannot be guaranteed and don’t allow for flexibility around childcare.

Murphy said there is a need for better quality flexible jobs for lower earners that allow them more control over their hours so that part-time work is not the only option. She said the Government needs to tackle constraints such as childcare costs that stop women from working more and they need to increase careers advice for younger workers who may be experiencing underemployment issues.

Katherine Chapman, Director of the Living Wage Foundation, said the Foundation had brought in a Living Hours commitment to tackle underemployment and precarity in the workplace. She said employers sign up to this in the same way that they sign up to the Living Wage. She highlighted issues such as lack of notice for shifts. A third of zero hours workers have experienced unexpected shift cancellations, she said. Sometimes that means they incur extra expenses, on average of between 20 to 40 pounds a week, such as childcare costs. People from ethnic minorities are more likely to have their shifts cancelled and to get short notice of shifts, added Chapman. That impacts their earnings, their social life, their wellbeing and their ability to plan.

Sarah O’Connor, Employment Columnist at the Financial Times, spoke about the issue of job satisfaction and said some of the changes employers are making, such as cutting breaks, may seem small, but have a cumulative effect which reduces any sense of job satisfaction or that workers are valued. Work has also intensified as a result of minimum wage increases, she added, and labour market shortages. Part-time work, she said, gave people more control and an ability to defend their time.

She also raised the issue of the role of the tax credit rules in terms of discouraging people from working longer hours. At the same time the Government is trying to raise people’s working hours by increasing pool of part-time workers threatened with benefit sanctions if they don’t do more hours. Murphy mentioned the Universal Credit taper and caps on childcare support as another part of the benefits-related constraints facing lower part-time earners.

O’Connor added that people are looking for very different things from work and that needs to be acknowledged. Chapman said it was about giving employees greater choice.

Part-time job ads

The Resolution Foundation meeting came just before a session by flexible work experts Timewise on their new report which shows the volume of people wanting part-time work is outstripping available part-time jobs by four to one. A Timewise survey of employers also suggests that trust – wanting to know someone before granting them flexible working, inertia [expecting employees to ask for part-time work rather than being proactive], a lack of data for making the business case and a lack of knowledge on how to manage flexible workers are the major hurdles to employers advertising part-time roles. Timewise would like to see more case studies and awareness raising on the benefits of part-time working as well as more support for managers.

Emma Stewart, co-founder of Timewise, said businesses need help and not just more legislation. She added that most part-time roles are in low paid sectors with the pace of change on part-time job offers in professional services sectors being very slow.

Kate Shoesmith, Deputy CEO of the Recruitment and Employment Confederation, said the business reasons for offering more part-time work are clear with an ageing workforce in search of greater work life balance and facing health issues. People need to be at the centre of business strategies, she said.

Louise Woodruff, Senior Policy Adviser at the Joseph Rowntree Foundation, said enabling better quality part-time roles with progression is key to addressing poverty. The gap between good employers and the rest is wide, she stated, and more employers need to get on board on flexible working at pace. That requires more investment in management training around issues such as job design and more attention being paid to issues such as health.

A representative from Lloyds Banking Group spoke of what the company was doing, including making its roles more modular, introducing midlife reviews, being more overt about different types of flexible working and looking at the kind of support people need at different life stages. Lloyds has set up a Life Stages advisory panel to encourage its employees to get involved in shaping its policies.

Stewart ended by calling for more investment in management training, greater consultation within teams and a focus on organisational change rather than fiddling around the edges. Those who invest will see a return on that investment, she said.



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