Ruby McGregor-Smith, chief executive of Mitie, has explained that the zero hour contracts and poor staff retention of carers working for suppliers often occurs because local authorities ‘won’t commit to exact hours’ in the contracts that they sign with private sector suppliers.

Mitie is a strategic outsourcing company that has become particularly active in the UK market for care at home over the past few years. Mitie recently issued a profit warning, suggesting that cuts to the rates paid by local authorities and the NHS have made the work less profitable than expected.

The low prices of government contracts have impacted on the wages that companies like Mitie are able to pay their employees. McGregor-Smith said: ‘We should pay carers above the minimum wage. We always offer a living wage option but it’s up to the local authorities what rate they pay. Where we pay the London living wage, retention is not an issue.’

This news comes shortly after the Trades Union Congress (TUC) published a report suggesting that the employees of private sector companies involved in healthcare outsourcing contracts are worse off than their counterparts employed by the public sector. The report did not acknowledge that the public sector could, in part, have a hand in this poor treatment.

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