When can workers claim UC on zero hour contracts?

Hi Everyone, I’m based in Manchester where UC is being phased in. One issue I face is that I am seeing more and more people with zero hour contracts. As far as I’m aware you can claim UC if you work and earn less than £338 per month. I’m seeing more and more people whose working zero hour contract income is usually slightly over, maybe anything between £339 and £420 (average) when I do the UC bencal it says they are not entitled to claim. However, once someone is on UC and starts working they can go over the £338 and the UC will automatically adjust. I think they base the eligibility of the previous month’s earnings and if it’s over £338 they can’t claim. If someone is consistently earning just a little over this threshold is it worth them working a month below £338 so that they can then claim UC? It’s a tricky one, especially as it’s being phased in I’m not sure what to advise for the best. But I’m seeing more and more people in hardship because of this. I’m just wondering if anyone has any thoughts on this? Many thanks, Sharon

The problem with claiming UC instead of tax credits is that they will be subject to ‘full conditionality’, in the DWP jargon. This means that they will be required to look for more hours or better paid work and will have to agree to a jobseekers agreement or claimant commitment and attend the job centre as though they were fully unemployed. And some job centres will refuse to set appointments that fit round their working hours. Despite official denials, there are targets for sanctioning people. For example, the last part-time working UC claimant I had, who had three children and was working 16 hours a week, was told she had to spend 30 hours per week looking for other work. She can’t work more hours at present and look after her children adequately at the same time; they’re too young to walk to and from school by themselves. And she is finding it impossible to actually spend 30 hours per week seeking work. (I have started advising clients to make sure the job centre can’t monitor what they are doing, so they have to take their word for it that they have spent 30 or whatever hours per week on job seeking.) If your clients can’t get working tax credit and/or housing benefit, I wouldn’t recommmend claiming UC. Or at least, they’ll have to be aware of the harassment they’ll have to deal with to sustain a claim.

£420 a month translates, at NLW, to about 13.4 hours a week work.  That’s well short of WTC.  JSA, with its limited earnings disregard is going to be the alternative.  That earnings level means either no JSA for single people , or the earnings disregard figure a week in real income for couples.and single parents.  Not much incentive to work, even after CTC, HB and CTR are included.

It also doesn’t free you from conditionality of course.

Carol was your client with the 3 children one of the people who has been selected for the in-work conditionality pilots for UC then?  Is it not the case that the in-work conditionality at this point in time only applies to those either earning below the lower earnings limit, or those selected for the pilot?

Also was she able to negotiate with the jobcentre for a reduced ‘earnings threshold’ or whatever its called, based on the ages of her children, her childcare requirements and restriction to school hours?