The Government has launched a consultation, running until 25 August 2026, on the precise conditions that would need to be satisfied for workers on zero-hours contracts to access enhanced rights. The consultation is aimed at tackling what policymakers describe as “one-sided flexibility”: situations where workers may be subject to unpredictable hours, last-minute shift changes and income instability.

If implemented as proposed, the reforms could represent one of the most significant shifts in casual work regulation since the introduction of the National Living Wage.

Below is a breakdown of the key proposals and what they could mean for employers, workers, and the wider labour market.

What is a zero-hour contract?

Zero-hours contracts are employment arrangements under which employers do not guarantee any minimum hours of work. Workers are generally under no obligation to accept work offered to them, and employers are generally under no obligation to offer work.

What are the key proposals under consultation? 

1. Right to Guaranteed Hours

At the heart of the reform is a proposed new right for qualifying workers to be offered guaranteed hours if they have worked regular hours over a defined reference period. For zero-hours contract workers, this could provide greater financial stability and predictability.

Who would qualify?

Workers must either:

• be on a zero‑hours contract, or
• have contracted hours below a threshold, which is yet to be determined.

How will guaranteed hours be calculated?

Guaranteed hours would be based on hours actually worked during a reference period. The Government favours a 12-week initial reference period, with 26- and 52-week alternatives also under consideration.

Two models for determining “regularity” are proposed:

• Weekly distribution requirement — the worker must have worked a minimum number of weeks in the reference period.

• Weekly distribution + total hours requirement — the worker must meet both a minimum number of weeks and a minimum number of hours above their contracted hours.

   

2. Right to Reasonable Notice of Shifts 

The second major proposal concerns the predictability of working time.

What counts as “reasonable notice”?

The consultation seeks views on whether reasonable notice should be: 

• 1–4 weeks for directly engaged workers

• 5 days or less as an additional option for agency workers

It also asks:

• when longer notice should be expected (e.g., where workers must accept any shift offered), and
• when shorter notice should be acceptable (e.g., emergency cover).

The proposal reflects wider research suggesting that predictable scheduling can improve worker wellbeing and reduce turnover, while still allowing employers a degree of operational flexibility.

3. Compensation for Short-Notice Cancellations 

Under the Employment Rights Act 2025, “short notice” must be defined in regulations and cannot exceed seven days. Two possible approaches are proposed:

• the length of the short‑notice period
• whether to introduce a “very short notice” category with higher compensation

How will compensation be calculated?

Two options are proposed:

• a percentage of expected earnings, or
• a percentage of the National Living Wage / National Minimum Wage

Suggested ranges:

• 10%–80% for short notice
• 30%–80% for very short notice

Exceptions may apply in limited circumstances such as: 

• extreme weather
• power outages

• other unavoidable disruptions

   

What would the reforms mean for employers?

If implemented, these reforms are likely to require employers to: 

• monitor working patterns more closely
• maintain accurate scheduling and record‑keeping
• review the use of zero‑ and low‑hours contracts
• assess whether guaranteed hours must be offered
• ensure shift notifications meet the “reasonable notice” standard
• budget for potential short‑notice cancellation payments

The sectors most likely to be affected include:

• hospitality
• retail
• social care
• warehousing and logistics
• education and seasonal work

These are industries where variable hours are common and where workers may be more likely to experience the unpredictability that the reforms are intended to address.

How we can assist you

At Thackray Williams, we support both employers and employees with clear, practical advice on employment rights, workplace obligations and the protections available under employment law. We can assist with navigating the latest developments, reviewing working arrangements and helping employers take steps towards compliance with confidence.

If you would like assistance navigating your employment rights or your employees’ rights or any other employment related matter, please do get in touch with our Employment team on 020 8290 0440 (Bromley) or 01732 496 496 (Sevenoaks) or employment@thackraywilliams.com.