Zero hours, low hours and umbrella arrangements

Individuals will have a right to a guaranteed hours contract that reflects the hours eligible employees regularly work over a reference period. Workers will also be entitled to reasonable notice ahead of any changes made to their working hours and compensation if their shift is cancelled or ended later.

Implementation Status

• Part of the Employment Rights Bill
• Further consultations expected, including in the right to reasonable notice of shifts and right to payment for cancelled, curtailed or moved shifts.
• Following consultation amendments made broadening rights to cover agency workers.
• "Many reforms" in the Employment Rights Bill will not come into force until 2026.

Action

• These provisions are complex, and employers will need to consider carefully the detail which will be fleshed out in regulations.
• Businesses should audit and assess their use of zero hour and low hour workers in light of this proposal and the further detail as and when it becomes available.
• Please speak to our specialist Workforce Solutions team to discuss the detail to discuss the detail and impact of these provisions on your workforce.

In detail

Guaranteed hours contract.

• Zero hour and low hours workers, who have worked a certain number of hours over a "reference period" will have a statutory right to be offered a contract with guaranteed hours. The meaning of a 'low hours worker', the qualifying number of hours to be worked and the reference period will be defined in regulations. The Next Steps paper suggests a possible reference period of 12 weeks. We are waiting for further details on how the offer must be made and how long it must remain open for. There is no obligation on a worker to accept an offer of a guaranteed hours contract.

• Proposed amendments to the Bill provide for a collective agreement to disapply this new duty.

• Following consultation, amendments to the Bill propose extending the right to qualifying agency workers.

• The Bill contains anti-avoidance measures.

Reasonable notice of shifts

• Employers will be required to give zero hours and low hours workers reasonable notice of shifts and changes to shifts (including cancelling shifts) with a right to compensation where late notice is given (see below). Regulations will set out the minimum notice that must be given.
• Following consultation, amendments to the Bill propose extending the right to qualifying agency workers. 

Compensation for cancelled, moved or curtailed shifts

• Where an employer cancels, moves or curtails a shift at short notice, a worker will be entitled to compensation.
• Following consultation, amendments to the Bill propose extending the right to qualifying agency workers.

Automatic unfair dismissal relating to guaranteed hours and right not to suffer a detriment

• It will be automatically unfair to dismiss an employee if the reason or principal reason is that they accepted or rejected or proposed to accept or reject a guaranteed hours offer or where the employer sought to avoid compliance with its duty to offer guaranteed hours.
• A government amendment has also been proposed making it automatically unfair to dismiss an employee if the reason or principal reason is that they brought proceedings under the anti-avoidance measures or made an allegation of such a breach, provided they act in good faith.  

Impact

• The government wishes to ensure that all jobs provide a baseline of security and predictability. However, it also recognises that zero hours contracts can work well for some individuals, such as students and those with caring responsibilities. By providing for "reasonable notice" of any chances, cancellations to shifts etc, the government hopes that this will give people a greater ability to plan their lives, without banning flexible arrangements that some workers benefit from. 

• Please speak to our specialist Workforce Solutions team to discuss the detail and impact of these provisions on your workforce.