The number of workers on zero hours contracts in the UK has increased by 15 per cent in the last three months of 2015 compared with a year earlier, an increase of 104,000 contracts, according to the latest figures from the Office for National Statistics.

One in 40 UK workers is on a contract that does not guarantee a minimum number of hours, the figures show.

Some 801,000 workers were on zero-hours contracts in the UK from October to December 2015, or 2.5 per cent of people in employment, compared to 697,000 workers in the same period in 2014.

Part of the increase may be accounted for by additional recognition of the term zero-hours, the ONS said, rather than new contracts.

Those people are statistically more likely to be young, part time, women or students compared to other people in employment.

On average, workers on zero-hours contracts work 26 hours a week. One third, or 37 per cent, of these workers would choose to work more hours if they could, compared to just 10 per cent of people in other kinds of employment.

How are zero hour contracts being used?

The youngest people in the workforce make up a huge number of those on zero-hours contract. Some 38 per cent of people on zero-hours contracts are aged 16 to 24, and 23 per cent of all workers on these contracts are in full-time education.

Research published by the TUC shows that average weekly earnings for zero-hours workers are just £188, compared to £479 for permanent workers.

Two-fifths (39 per cent) of zero-hours workers earn less than £111 a week – the qualifying threshold for statutory sick pay – compared to 1 in 12 (8 per cent) permanent employees.

“Many people on zero-hours contracts are unable to plan for their future and regularly struggle with paying bills and having a decent family life," Frances O'Grady, TUC general secretary, said.

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“The so-called ‘flexibility’ these contracts offer is far too one-sided. Staff without guaranteed pay have much less power to stand up for their rights and often feel afraid to turn down shifts in case they fall out of favour with their boss," she added.

Research by the debt charity StepChange has shown that insecure work and sudden falls in income can mean many people turn to credit to get by.