Atypical Contractual Agreements

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In the recent decades, there has been a growth in atypical contractual arrangements. Typical contractual arrangements include permanent, open-ended, full-time, workplace-based form of employment. But the trend has changed over the years. Now, atypical contractual agreements have entered the scenario. In response to the evolution in labor market developments and restructuring of industries have led to atypical agreements, which are used for effective management of people.

Contracts of limited editions

The contracts of employment can vary in many ways. They sometimes depend on their length. The three basic forms are discussed below:

  • Permanent: This one is open-ended and does not have any date of expiry.
  • Fixed term: This mentions a start and a finish date and includes a notice period.
  • Temporary: When people are employed for a limited period but there is no mention of the expiry date of the tenure, this form of contract employment is used. For example, if the funding source comes to an end, the tenure of the job will also come to an end.

In UK, the trend of employing people of public sectors in fixed term basis is quiet prevalent among the employers. When employment increases, the economy takes a positive turn and this prompts employers to offer permanent positions to employees. In the recent times, around a quarter of temporary staff now claim that they would prefer a permanent job, but this figure was half in the mid-1990s.

There are obvious reasons for employing people on a temporary or fixed term basis. There is a fluctuation in retail stores such as, before festivals, there is a rush hour in stores. Similarly, the sales of ice-cream drop during winters and therefore ice-cream companies will require less manufacturers during winters. People are employed depending on these conditions.

Often, temporary employees are required to perform duties which are the duties of permanent employees. This can happen due to a variety of reasons like sickness leave or maternity leave, which results in a gap between one person resigning and the other one taking up the job. Employers often hire temporary employees and keep them on a probationary basis. Their appointments are confirmed when they are fully able to satisfy their employer with their temporary jobs. It is argued that managers prefer temporary staff because employing these people allows them to have a greater degree of control over labor. In order to secure their jobs, result temporary workers are keen to impress their boss and they work beyond their contract in a bid to gain a permanent position. Their absence levels tend to be low. As they work under a threat of being dismissed, they behave in total compliance. Managers often take advantage of this situation and push people to work harder, which is good for the organization.

The Employment Act of 2002 ensures that temporary employees enjoy the same terms and conditions as those of permanent employees undertaking equivalent roles. It is also mandatory for employers to inform them about the permanent vacancies and allow them access to training opportunities. This law limits the number of times an employer can renew a fixed-term contract without making it permanent. After October 2006 those who have been employed on a temporary basis for four years or more are eligible for permanent positions unless there is any valid objection from the employer’s side.

Apprenticeship falls under a special condition for which there are special laws. The law defines a legally binding working relationship which pre-dates the current legislative rights in employment, and therefore the apprentice is provided with additional rights during the training period. The employer does not have the right to terminate an apprentice’s contract before the agreed period of training is complete. The only exception is unless there is closure or a fundamental change of activity which justifies the redundancy.

Part time contracts

At a time, working part time was considered unusual because it was hardly economic. Part time employment was not that popular since national insurance costs of the part-time employee were disproportionate when it was compared to full-timer employees. This was not given much priority because of factors like lower rates of pay, no security of employment and exclusion from such benefits as sick pay, holiday pay and pension entitlement. But now the situation has changed. The employed workforce working on part-time contract has increased significantly since the 1960s.

In 1960s, around 9% of the people were employed as part time workers and it is now almost a quarter of seven millions. The table given below shows the percentage of people working part-time in various countries.

Atypical Contractual Agreements 6

According to British calculation, part time is classified as anything where the working hour at the place of work is less than the normal weekly hour. A person employed in a part time job has varied weekly hours. In spite of the factors mentioned above, the number of people working part time is on the rise.

If we talk in figures, women account for four-fifths of all part-time workers in the UK, 44 % of which are employed on a part-time basis and there is only 10 % male. Coming to distribution on the basis of age, the age of part time male workers are in the range of 16–19 and above 65 years, which suggests that full-time work is the preference for most men in the period between leaving school and retirement. In women, the age pattern is different. Around a quarter of women work on a part-time basis in their twenties, and it rises to

40 per cent in the age group of 30–34 and 50 per cent in the age group of 35–39. After that, there is a decline in the percentage till retirement. Among women, therefore, part-time work appears very frequently to be undertaken during the time when women have their children at school.

If we want to classify part time jobs on the basis of industry, retailing and catering account for most of the part-time jobs.

Part time workers can work in shifts and sometimes two persons can share a full working day. One day, a person can work for an entire day and the other day, he/she might not work. It is flexible and depends on the work pressure.

Distance working

Employees are looking for ways to finish their quota of the work by being working on the work premise. This can be fulfilled by ways of Working overseas, working from home, teleworking and tele-cottaging. The advantages include flexibility of working hours, time which can be saved by not travelling to work every day. But there are disadvantages too. Though there have been many possibilities and arrangements have been made in such a way that people can opt for distance working, but it is yet to gain popularity. This is because many people can find the experience of distance working isolating, and along with that, they miss the social life and a sense of belonging to the community.

Teleworking can prove to be beneficial for both the employee and employer because it is flexible. The benefits which the employer can draw is the reduction in the office accommodation costs. If it is coupled with increase in productivity, it can prove to be a boon for the organization.  On the part of the employees, this type of working pattern provides facilities such as avoiding the traffic and saving the time which is spent on commuting to work and working from the comforts of their home. They can simultaneously carry on with their work and carry out the responsibilities related to household. The initial stage of attaining settlement in distance working can be difficult. But once that is achieved, people can achieve a flow in their work.

On the part of the employers, there is a need to maintain a reasonable degree of management control in such a varied scenario. It is important to set out clearly defined parameters of action, decision criteria and issues. Person specifications also become important as the scope of training employees in this situation is very less. In the case of distance working, a link needs to be maintained between pay and performance. Managers such specify job targets and requirements which should be followed by the employees.

Self – employment

In UK, self-employed people constitute about 11% of the workforce. It is higher in London, because in London, there are many industries which take the services of self-employed people. The demand of self-employment is lowest in public services and manufacturing sectors while it is highest in retailing, construction, business and personal services industries.

In 1980s, there was a growth in self-employment. But as the pay of self-employed people is low as compared to those working in an organization, there has been a decline in the graph. Long working hours and less reward were the other factors. From the employers’ perspective, self-employment is beneficial because the employees need to be paid only for the time they actually spend completing a job or they can be paid a set fee for the completion of a project irrespective of the time taken to complete the project.

 

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