Tagged: bankruptcy

Zero Hours Contracts Force Workers To Rely On Food Banks, Says Charity

Highly controversial Zero hours contracts are forcing Scottish workers to turn to food banks and payday lenders, according to a new report from Citizens Advice Scotland (CAS).

The report, ‘Working at the Edge‘, found that the inappropriate use of zero hours contracts by unscrupulous employers is exploiting workers and leaving them with “no hours, no pay and no chance”.

Some employers are now using zero hours for the majority of their staff, the report says, with women representing over half of those workers trapped on the controversial contracts. Young people and pensioners are also greatly affected.

 While Zero hours contracts can be beneficial for some people, such as those seeking casual or seasonal work, but far too often they provide workers with no guarantee of hours and shifts can be cancelled with little or no warning, say CAS.

Workers are frequently denied equal and fair working rights routinely awarded to part-time and full-time staff. The report warns that some employers are using zero-hours as a tool to easily sack staff.

CAS also warns that the misuse of zero hours by some employers is leading to some workers facing bankruptcy and prosecution over unpaid debts.

The report includes a case study of a CAS client on zero hours who only had three days work in a month and was forced to turn to a food bank to feed themselves. The client received a court summons after they found themselves £1,000 into arrears as a direct result of not being given enough hours work to pay debts.

Another case tells the story of a waitress on zero hours who was facing possible bankruptcy, after stacking up a debt of nearly £5,000 to payday lenders, while they waited for their employer to give them more hours work.

CAS policy manager Keith Dryburgh said:

Zero hours contracts (ZHCs) are meant to provide flexibility for employers and workers alike. They are not suitable for everyone, but they can be a useful option for some people — as long as the system is applied fairly.

“However, we see growing evidence that the system is in fact being abused by some employers, who are frankly misusing it to exploit their workers.

“It seems that the flexibility in the system often lies with the employer, not with the worker. And too often workers are left with no hours, no pay, no security and no chance.

“There are 1.4 million people on ZHCs across the UK. They tend to be aged under 25 or over 65. Over half of them are women, and the areas they work in are those like catering, tourism, food and care.

“In highlighting these cases we hope to persuade employers that they should do right by their staff, and also to open a dialogue with government about how to improve the system to make sure this kind of exploitation doesn’t occur.

“We make a number of recommendations in the report, and we want to engage with ministers, unions and others to discuss ways to ensure a fair deal for all workers.

“We also want to get the message to any worker who is on a zero hours contract. You have rights, and we can help you to stand up for them.

“If you are unhappy with your contract or unsure of your rights, contact your local CAB and we will help you with free confidential advice.

“Nobody in 2014 should be in a position where they are working but don’t have the security of an actual income.”

The Scottish Government has previously called on the UK Government to crack down on the use of inappropriate zero hours contracts, by ensuring that workers receive compensation if shifts are cancelled at short notice.

Commenting on the report from Citizens Advice Scotland, SNP MSP Linda Fabiani said:

While the UK government is encouraging the use of zero hours contracts, the Scottish Government has been looking at options available to tackle the issue within its current limited powers.

“As employment policy is reserved to Westminster, this is yet another example of how we can do things differently, and better, with independence.

“Zero hours contracts can be beneficial for some but they are not appropriate for everyone – and are more likely to be offered to women, young people and pensioners. And the growth in the inappropriate use of these contracts is clearly cause for real concern.

“The fact that anyone is forced to rely on food banks in a wealthy country like Scotland is nothing less than a scandal – but that people in employment are now struggling to afford the basics like food is simply unbelievable.

“After a Yes vote we can use the powers of independence to make sure that more people feel the benefits of Scotland’s wealth.

“The establishment of a Fair Work Commission and a commitment to raise the minimum wage at least in line with inflation will help us take action on low pay.”

Source – Welfare News Service,  23 July 2014

http://welfarenewsservice.com/zero-hours-contracts-force-workers-rely-food-banks-says-charity/

Hartlepool residents rack up £7.5m debt mountain

Hundreds of people in Hartlepool have been forced to plead for help after racking up personal debts worth £7.5m in just a year.

 Shocking new figures reveal Hartlepool Citizens’ Advice Bureau supported 1,500 people with debt and money advice over a 12-month period – with the average debt a staggering £16,000.

Worried officials at the Park Road-based CAB say they are very concerned with the high level of personal debt their clients have, some of which is more than £100,000.

Not everyone in money trouble seeks help or advice from the CAB either so the £7.5m figure – which is similar to previous years – is likely to be even higher.

Personal debt includes everything from credit cards, personal loans, pay-day loans, mortgage and rent arrears, council tax arrears, catalogue debts and bank overdrafts.

The figures relate to the period between April 1, 2013 and March 31, 2014. In 2012, the figure was around £8m and worried officials say there has been no “let-up”.

Joe Michna, CAB manager, said: “There has been no let up or reduction in the number of people contacting us with debt related problems.

“The debt levels, given that they are average figures, are concerning.

“While the average debt may be £16,000 excluding mortgages, some clients have debts of well over £50,000 when they contact us.

“We deal with clients who have personal debts of everything from a few thousand through to £100,000.”

Officials say the golden rule for those experiencing money trouble is to seek help or advice early.

The CAB offers two services, a Debt Advice Service and a Money Advice Service, which offers help and support from everything from financial planning to budgeting.

CAB staff aim to re-arrange and improve debt-ridden clients’ financial affairs by gathering information on a client’s indebtedness, confirming household income, alerting clients to other potential sources of income, and identifying priority debts.

Once a full and complete picture of a client’s financial situation has been established, the CAB team can help to identify the most appropriate option for dealing with the particular client circumstances which include self-help support packages, negotiations with client creditors and bankruptcy applications.

The debt and money advice services gave advice and assistance to a combined 1,500 clients.

Mr Michna added: “The golden rule for people who have gotten themselves into debt is to seek advice early.

“We are fortunate in that we can offer two services to local people – a full debt advice service and also a money advice service.

“The money advice service can offer advice on budgeting, financial planning and income maximisation.

“We then have our full debt advice service which offers advice and assistance with debt relief orders, bankruptcy and individual voluntary arrangements as well arranging repayment plans with creditors.”

 

Source –  Hartlepool Mail,  16 July 2014