Zero Hours Contract Changes 2026: Ending ‘one-sided flexibility’ in zero hours contracts
2027 will see The Employment Rights Act 2025 have its final round of implementation. Among the legislative changes the Government will be looking to reform zero hours contracts, in particular what has been referred to by the government as "one-sided flexibility".
The Government is currently running a public consultation pertaining to the detail of the implementation of zero hours contracts as part of the Employment Rights Act 2025. The consultation will close as of midnight August 25th before considerations and a published response. The regulations will be made after this in due course, with implementation expected in 2027.
Talk to a member of the Croner HRand Employment Law Advisory team today to find out how the latest changes under the Employment Rights Act will affect your business. Call 0808 501 6650.
What the consultation on zero hours contracts covers
The consultation invites feedback on the following proposed new rights, which will be detailed in regulations:
Rights on guaranteed hours, meaning hours offered to a qualifying worker are based on the hours worked during a reference period (expected to be roughly 12 weeks).
Rights regarding reasonable notice of (and any changes to) shifts.
Right to payment for cancelled, curtailed or moved shifts when on short notice.
Note: These reforms will also apply to agency workers.
A right to guaranteed hours
Pending the Government consultation, it is expected that employers will have an obligation to offer hours to workers on zero (and other qualifying low hours), a guaranteed hours contract, reflective of their usual hours of work (based on a reference period expected to be approx. 12 weeks).
One of the considerations for calculating guaranteed hours will be whether or not to use the mean or the median hours in the reference period.
Working patterns and days that form part of a guaranteed hours offer to a worker, how this is formatted and the length to offer extends until are likely to be addressed by regulations, as presently they are not laid out in detail in the current consultation.
Workers have the right to reject the guaranteed hours offered and still remain on a low or zero hours contract. However, they must still have a guaranteed hours contract offered to them each reference period. Part of the Government's consultation will focus on the length of the subsequent reference periods, triggering an assessment of guaranteed hours offers and whether there needs to be a gap between reference periods.
As part of the upcoming changes, it will be possible for a collective agreement to have the right to guaranteed hours displayed on it. The maximum award for non-compliance will be addressed in regulations.
A right to reasonable notice for shifts
From 2027 employers will be required to give reasonable notice when it comes to changes in shifts, as well as prior notice of shift allocation. This will be applicable to workers on both zero hours contracts and those on low hours, including workers with no set work pattern and those workers who are offered shifts that fall outside of their standard working pattern and will include changes to both starting and finishing times.
What is defined as a starting point for reasonable notice is currently part of the government consultation, with one week, a fortnight, three weeks and four weeks up for debate. In the case of less notice being, the onus is on employers to show that less notice was reasonable given the circumstances. The government is looking for input on the factors a tribunal should consider when making a decision whether it was reasonable to offer shifts with less notice.
Right to payment for shifts cancelled, curtailed or moved at short notice
'Short notice payments' will need to be given to workers where an employer cancels, moves or alters the length of a shift at short notice. This will need to be issued in the instances where the worker reasonably believed they were needed for the shift.
Part of the Government consultation is defining the terms and length of this short notice period, with one, three, five and seven days as options. There is also a discussion to introduce a 'very short notice period', which will trigger a higher payment.
Regarding the amount that the worker will receive, the consultation is currently deliberating on whether the payment will be a percentage of the workers actual expected earnings for the hours, or whether this should be National Minimum Wage and whether this should be between 10 or 80%.
A collective agreement will have the power to disapprove the right to reasonable notice for shifts and changes to shifts.
Enforcing changes to zero hours contracts
The Government consultation asks about the level of penalties when short-notice payments aren’t made, and considers whether the Fair Work Agency (FWA) should help enforce specific zero-hours protections. If enforcement is to be carried out by the FWA then the consultation also asks how these should be enforced.
The Government’s preference on penalty amounts is for 50% of arrears owed to the worker, a £100 minimum payment per case and £5000 maximum payment per worker.
Get expert advice on zero hours contracts
Navigating the changes under the Employment Rights Act 2025, can be a challenge, thankfully Croner's team of experts are on hand to help.
Contact a member of our HR Advisory team today. Call 0800 470 9999.