The government has launched a consultation on regulations that will implement new rights for zero- and low-hours workers. Although the broad framework is already set out in the Employment Rights Act 2025 (ERA 2025), the consultation will shape the practical detail of the new regime, including which workers qualify, how employers calculate guaranteed hours, how much notice they must give of shifts and what compensation will apply where they cancel, move or shorten shifts at short notice. For employers who rely on flexible staffing models, the outcome could have significant implications for workforce planning, record-keeping and scheduling practices.
Determining eligibility for guaranteed hours
The new rights will apply to workers on zero-hours contracts and to workers whose contracted hours fall below a specified threshold. One of the key questions in the consultation is where the government should set this threshold. The government has indicated a preference for a threshold between eight and 20 hours, which it considers may provide favourable balance between costs and benefits.
Guaranteed hours offers would be based on hours worked during a reference period. The government’s preferred approach is a 12-week reference period, although the consultation asks if a longer period of between 26 and 52 weeks would be more appropriate. The consultation also seeks views on the length of subsequent reference periods and whether they should begin immediately after the previous period ends.
To qualify, workers would need to demonstrate sufficient regularity during the reference period. The consultation puts forward two options:
- assessment by reference to a minimum number of weeks worked; or
- assessment by reference to both a minimum number of weeks worked and a minimum number of hours worked above contractual hours.
Employers will not need to make a guaranteed hours offer to workers engaged on reasonable limited-term contracts, such as contracts entered into for a specific task, event or temporary need. The government is seeking views on what additional temporary arrangements should fall within this exemption.
The consultation also considers whether:
- employers should calculate guaranteed hours using mean or median average hours worked during a reference period;
- employers should have flexibility to determine the period over which to allocate hours under any offer (e.g. weekly or monthly); and
- to allow a limited adjustment margin to account for minor variations in calculations or shift patterns.
The consultation also calls for feedback on potential exemptions for certain workers and employers, including where a worker already has another qualifying contract with the same employer exceeding the threshold or where exceptional circumstances affect business operations.
Shift notice and cancellation payments
The government proposes that the rights to reasonable notice of shifts and to compensation for cancelled, moved or shortened shifts should only apply to workers whose contracts guarantee hours at or below a specified threshold. This threshold might differ from the threshold set for the right to a guaranteed hours offer.
The government recognises that a fixed period of notice which employers must give in every case is unlikely to be workable. What amounts to reasonable notice will depend on the circumstances in each case, but the government intends to introduce a presumption of what counts as reasonable notice. For directly engaged workers, the options range from one to four weeks’ notice, while for agency workers the government is considering a shorter notice requirement of five days or fewer.
The consultation also asks whether different notice periods should apply in particular circumstances, such as where workers are required to accept shifts offered to them or where employers need to arrange emergency cover.
Under the ERA 2025, “short notice” of shift cancellation, curtailment or movement cannot exceed seven days. The consultation requests feedback on the appropriate length of this period and is also considering a separate category of “very short notice”, which would attract higher compensation.
The consultation invites views on whether employers should calculate compensation as a percentage of expected earnings or by reference to the National Living Wage or National Minimum Wage. Proposed compensation levels range from 10% to 80% for short-notice cancellations and from 30% to 80% for very-short-notice cancellations. The government is also considering whether limited exceptions should apply where cancellations result from circumstances outside the employer’s control, such as extreme weather events or power outages.
Enforcement
Workers will be able to enforce these rights through employment tribunals. The consultation also asks whether the Fair Work Agency should have powers to enforce short-notice payments.
Under the government’s preferred approach, the Fair Work Agency would be able to issue notices of underpayment requiring employers to pay arrears owed to workers and a financial penalty to the government. The proposed penalty would be 50% of the arrears owed, subject to a minimum penalty of £100 and a maximum of £5,000 per worker.
Practical considerations for employers
The consultation closes on 25 August 2026. Employers likely to be affected by these new rights should consider submitting their views to help shape the practical detail of the regime.
The new rights will take effect in 2027 on a date yet to be announced. In the meantime, you may wish to consider taking preparatory steps:
- Review workforce arrangements:Consider whether any workers regularly work hours that exceed their contractual entitlement and could potentially qualify for guaranteed hours under the new regime.
- Assess scheduling practices:Review how you allocate shifts and how much notice you typically provide, particularly where business operations rely on flexibility or last-minute staffing changes.
- Evaluate record-keeping processes:Accurate records of hours worked are likely to become increasingly important in determining eligibility for guaranteed hours and demonstrating compliance with any new obligations.
- Consider the impact of shift changes and cancellations:If you frequently have to cancel, move or shorten shifts at short notice, assess the potential operational and financial implications of a compensation regime.You may also wish to audit the reasons for those changes and identify whether better forecasting, cover arrangements or approval processes could reduce the need for last-minute changes.
While the final detail of the regime remains subject to consultation, you do not need to wait for the regulations before assessing your organisation’s potential exposure. Early analysis of working patterns, contractual arrangements and scheduling processes will help you identify where the new rights are most likely to bite and put you in a stronger position to adapt once the final rules are confirmed.
