Data released today by the Office for National Statistics (ONS) showed the number of people on zero-hours contracts, which do not guarantee staff a certain number of hours' work, rose by 20 per cent to 2.9 per cent of the overall workforce between April and June this year.
This was equivalent to 903,000 people, compared to 747,000 (2.4 per cent) in the same period of last year.
However, the ONS has said this rise could be attributable for improved awareness and greater recognition of the contracts.
The ONS' Nick Palmer said:
The estimated number of people saying they work on a zero-hours contract has risen by over 20 per cent since the same time last year. The ONS will continue to monitor and report on this trend to help inform understanding of changes in the UK's employment market.
It is likely though that some of the increase we are seeing is because public awareness of the term 'zero-hours contract' has continued to grow.
The figures have been compiled by the ONS' Labour Force Survey, in which people can self-report their working contracts. This explains why greater recognition of the issue could be pumping up the numbers and follows on from another recognition-based increase earlier this year.
The last survey that calculated the number of zero-hour contracts in circulation - rather than people who were on them - was published in March, and showed there were 1.7m contracts that did not guarantee a minimum number of hours.
In the report released today, larger companies were found to be more likely to use zero-hours contracts.
Four in 10 businesses with more than 250 workers make some use of no guaranteed hours agreements, compared with around one in 10 businesses with fewer than 10 workers.
This week Sports Direct U-turned on the policy and said it will ensure all casual retail staff are offered guaranteed hours, as well as saying all warehouse staff will be paid above the national minimum wage.
Women and young people disproportionately affected
Women were disproportionately affected by zero-hours contracts, making up more than half (55 per cent) of those working on a zero hours basis.
Young people were also more likely to be working on a zero-hours basis, as more than a third (36 per cent) of zero hours workers were aged between 16 and 24. One in five were in full-time education.
“Zero-hours contracts have become an easy way for bosses to employ staff on the cheap," Trades Union Congress general secretary Frances O'Grady said. "There is no getting away from the fact that zero-hours workers earn less money and have fewer rights than people with permanent jobs.
"“It is very easy for politicians and employers to talk about the ‘flexibility’ these contracts offer. But they are not the ones living at the sharp end of the labour market."
A spokesperson for the department of business, energy and industrial strategy said:
As the Prime Minister has made clear, we want to do more to build an economy that works for everyone and to help working people who are struggling to get by.
Since May last year, the use of exclusivity clauses has been unlawful, meaning that individuals have more control over their lives and can work more hours with another employer if they wish.