Employment Law6 min read

Zero-Hours Contracts: What the New Rules Mean for Your Business

The Employment Rights Bill introduces new rights for zero-hours and low-hours workers. If your business relies on flexible staffing, here's what you need to know - and what you need to change.

Zero-hours contracts have long been a feature of the UK labour market, offering flexibility for both employers and workers. But the Employment Rights Bill significantly changes the landscape for businesses that rely on them. Understanding the new rules - and acting on them before October - is essential.

The core change is the introduction of a right for zero-hours and low-hours workers to request a contract that reflects their regular working pattern. If a worker has consistently worked a certain number of hours over a reference period, they will be entitled to ask for a contract that guarantees those hours. Employers will be required to respond within a set timeframe and will only be able to refuse on specific, prescribed grounds.

This doesn't mean zero-hours contracts are banned - they remain a legitimate arrangement, particularly for genuinely variable work. But employers who have been using them as a default, even where workers have predictable and regular hours, will need to review their arrangements. Using a zero-hours contract to avoid giving workers the security they've effectively already earned is no longer defensible.

The Bill also introduces protections against the practice of 'last-minute' shift cancellations. Workers who have a shift cancelled or curtailed at short notice will be entitled to compensation. The exact notice periods and compensation rates are still being finalised in secondary legislation, but employers should begin reviewing their scheduling and communication practices now.

For businesses in hospitality, retail, care, and other sectors that rely heavily on flexible staffing, these changes require a genuine rethink of workforce planning. The starting point is a thorough audit of your current zero-hours arrangements: who is on them, what hours they actually work, and whether those arrangements are genuinely flexible or simply a way of avoiding employment obligations. An honest assessment now will save significant headaches later.

SHR

Salus HR Consultancy

Expert HR advice for UK businesses

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