The Government will consider introducing a Leveson-style code of conduct to stop bosses exploiting workers through zero-hours contracts, Business Secretary Vince Cable said today.
Mr Cable said the Government would intervene if it found the controversial contracts - where workers do not know their hours from one week to the next - were being abused by employers.
Other options being discussed in a consultation, Mr Cable said, are measures to force employers to switch workers to permanent contracts after a certain time.
The Business Secretary said the Government could also ban "exclusivity" clauses within the contracts, which prevent employees taking up other work.
He said many job applicants often did not know what contract they would be offered when they took work.
A code of conduct for employers to provide their new staff with better information was another option, Mr Cable said, telling the House of Commons that it could have statutory underpinning like the press regulations demanded by Sir Brian Leveson.
His comments, during an Opposition Day debate in the Commons, will put Mr Cable at odds with Conservatives, who are keen for less regulation on businesses as part of efforts to stimulate economic growth.
The Business Secretary said: " It is important, I think, that we do not close down options. I think in terms of exclusivity, there are a variety of things that we could do.
"One of them is to do nothing and rely on the existing law. We could ban it - that is another option. Another possibility is to have effective information and guidance under which employers are required to justify it - there are a range of possibilities with a variety of interventions.
"Secondly, there are the cases of people who are employed for very long periods on zero-hour contracts where they don't choose to be. Should we build in a system where employers are required to offer permanent employment at some stage? That is certainly an option to look at.
"Thirdly - and probably the most important - there is the issue of transparency. You can argue for fairness and from an economic flexibility point of view that if rational people know what they are doing, then that is considerable improvement.
"The problem we have discovered, and many people have pointed out, is that people are often not clear when they take on a job offer what the obligations and permutations are and so there is a question about whether we should have a code of conduct, which builds in proper transparency and information - that could be voluntary, it could be a Leveson-style code of conduct with statutory underpinning, it could be a stronger sanctions-based body.
" There are a range of sanctions. We are going to look at them with an open mind and will take action accordingly."
He added: "We recognise that there is a real problem here and we also recognise it's a very difficult problem, which is why (Labour) perhaps didn't engage with it. There are issues of definition, enormous gaps in the database. We have got to try and address that. But where we identify, as a result of this consultation, serious abuses for which there are practical remedies, we will then take action on that."
He also insisted those on jobseeker's allowance would not lose their benefits if they turned down a zero-hours contract.
He added: "Zero-hours contracts may simply be the symptom rather than the cause of the problem. A lot of employers are up against it... and use these contracts as a way of survival."
Mr Cable has written to the Office for National Statistics (ONS) to raise his concerns about the fact there is no reliable data on the use of the contracts.
In his letter, he has asked the ONS to look at how the statistics are collated and presented, and to ensure they provide a more accurate picture of the scale and number of the contracts in the UK.
Mr Cable has given his support to the ONS proposal to set up a committee to consider the statistical issues around measuring zero-hour contracts. He also wants them to consider other non-ONS sources of data and to comment on their strengths and weaknesses so that a clear and comprehensive picture is available.
Shadow business secretary Chuka Umunna said coalition ministers had spent much time and effort eroding workers' rights by implementing the recommendations of venture capitalist Adrian Beecroft, who had urged the Government to make it easier for company bosses to hire and fire workers.
But he claimed little or nothing had been done to protect workers from contracts where they had no guarantee of work or pay, but which required them to be available at all times.
Opening the debate in the Commons, Mr Umunna said: "The nature of work in our country has changed in recent years. Half the rise in employment since 2010 has been in temporary work. This is being driven primarily by people doing temporary jobs because they can't find permanent work.
"There are record numbers in part-time work who would prefer to be working full-time, so there is huge under-employment... but perhaps the most shocking symptom of the changing nature of work is the proliferation of the use of zero-hour contracts.
"This means individuals engaged under these contracts never know when work will come and whether they will be able to sustain themselves and their families week to week.
"I don't deny these contracts have been in use for many years... but until recently they were very much the exception to the rule. The problem is now they are becoming the norm in some sectors."
Mr Umunna drew a comparison between Sports Direct, which uses zero-hour contracts across the board, and Asda, which he said preferred not to employ staff on such a basis.
And he told MPs: "I think it is important we call out people who are systematically exploiting and abusing people under these contracts."
Tory MP Charlie Elphicke (Dover) said he was worried about the use of the contracts.
He said: "It is important that we understand the concerns our constituents have because all of us have those who come to us in our surgeries and they set out their concerns and they also set out their concerns that if they raise it with their employer, then they may not have a job by the end of the day.
"I have had many such cases and I view such cases with considerable concern. I think it is right that we work to re-balance it because the flip-side is, as we all know, for many people these contracts have the flexibility that works with their lives.
"How people live their lives, and the flexibility they need in terms of employment, is an important consideration to take into account.
"Yes, enterprise and profit are really important but there is a difference between profit and profiteering and we need to make sure that people who are unequal in their bargaining power are able to ensure that they have the protection of the law that is required in order that they can get a fair settlement.
"That is the area that the Government need to focus on, is focusing on and is looking at."