Myth Zero-hours contracts are being banned.
Fact They stay, but the Employment Rights Act 2025 will significantly restrict how they can be used.
How it will work
A guaranteed-hours offer after every reference period
Employers will need to make a guaranteed-hours offer after each reference period in which a worker regularly works more than their contracted hours.
One reference period: 12 weeks
Preferred, still out for consultation
Contracted: 8 hrs
[Example] A worker contracted for 8 hours who regularly works around 18 should be offered guaranteed hours that reflect it.
- Track the hours Record the hours each worker actually works across the reference period.
- Compare with the contract Do they regularly work more than their contracted hours?
- Make the offer Offer guaranteed hours based on what they regularly work.
- The worker decides They can accept, or decline and stay on flexible terms. Then the next period starts.
Who it affects
Two kinds of worker
The changes will affect zero-hours workers and low-hours workers.
Zero-hours workers
- Contracted 0 hrs
- Usually works 16 hrs
Workers with no guaranteed minimum hours.
Low-hours workers
- Contracted 8 hrs
- Usually works 18 hrs
Workers who regularly work beyond their contracted hours.
Workers keep the choice. They can decline a guaranteed-hours offer and remain on flexible terms.
Shifts and cancellations
More notice, and pay for late changes
Employers will also need to give reasonable notice of shifts and cancellations.
Shifts
Reasonable notice of when shifts are.
Cancellations
Payment may be due where a shift is cancelled or changed at short notice.
What employers should do
Your plan, in three stages
Now: know your workforce
- Review workforce data and identify workers likely to qualify.
- Audit actual hours worked over rolling 12-week periods.
Next: get ready
- Update contracts, scheduling practices and cancellation procedures.
- Assess the financial impact of guaranteed hours and cancellation payments.
Ongoing: stay ahead
- Monitor forthcoming regulations and implementation dates.
The bottom line
Flexible staffing will remain necessary, but employers will need to share more certainty with workers.
Preparing early, particularly through better workforce data and rota management, will reduce compliance risk and operational disruption.
This article provides general information only and is not legal advice.
Sources: Littler, Pinsent Masons, Lewis Silkin