WAGES, INEQUALITY, AND WORKER RIGHTS: THE CONSEQUENCES OF BANNING ZERO-HOUR CONTRACTS IN THE UK

Abstract

The labour party’s new administration has seen the passing of a law to ban
“exploitative zero-hour contracts.” The passing of such a law aims to diminish the instability
of UK’s labour market in an attempt to bring forth a more viable and anchored income source
for all UK citizens. However, while this law does have the opportunity to provide security
within the labour market, the beneficial freelancing and openness of these contracts may be
lost in the process. Therefore, this paper aims to delve into the expected outcomes of such a
law and its impact upon workplaces across UK regarding the stakeholders of individuals,
firms and governments. This research reveals the complex interplay between the labour
policies and income inequality, particularly among low-income and freelance workers.
Stemmed from this, the policy does not focus on the main underlying economic issue of wage
inequality and job security. Therefore, through this policy, policymakers have inadvertently
traded one form of instability for another.