Zero-Hour Contract Reforms Coming in 2026 & 2027

From next year, changes to those employed on zero or “low” hours contracts will come into effect. 

What are those changes and what do they mean for employers and employees? 

Planned changes

Right to guaranteed hours

Employers will be required to offer eligible workers guaranteed hours based on the hours worked during a “reference period”.  It is currently expected that the reference period will be 12 weeks. Whilst the obligation is on businesses to make a guaranteed hours offer, there is no obligation for workers to accept. Eligible workers include those on zero hour and “low” hour contracts (what is “low” is yet to confirmed but the government has indicated 16 hours or less). Eligibility will be extended to agency workers, however the responsibility to meet the new expectations will be shared between the agency and the hirer. Guaranteed hours offers made to agency workers will need to match the pay of comparable workers or the most favourable pay received by the agency worker in the reference period. 

Right to reasonable notice of shifts 

Employers must provide workers with “reasonable notice” prior to shifts and shift changes/ cancellations. If an employer changes a shift with unreasonable notice, a worker can bring a claim in an employment tribunal. The definition of reasonable will be clarified in future regulations.  As above, agency workers are also covered by the right. 

Compensation for changed shifts 

In the event that a shift is cancelled, curtailed, or moved at “short notice”, the employer will be required to make a payment to the worker. Again, what is “short notice” is to be confirmed following consultation. 

Right to be informed 

Employers must supply workers with information on their rights to guaranteed hours at the start of the engagement and throughout. 

Practical Implications

For employers, the changes are likely to add an administrative burden to businesses to track hours worked by those who qualify, reference periods and shift changes. Businesses will need to consider how to manage informal shift swapping alongside the requirements for “reasonable notice”, which is common in workplaces utilising zero-hour contracts. Furthermore, seasonal changes in demand may create complexities with the 12-week reference period, requiring businesses to offer guaranteed hours at a point when seasonal demand has tailed off. Lastly, it is unclear on the process when changes to shifts occur beyond the employer’s control, such as weather changes or sudden changes in market demand.  Ultimately, the level of impact will depend on the definition of “low” hours – if the government proceeds as indicated to define “low” as 16 hours or less, this could bring a large number of workers in scope. 

Action points for employers and employees 

If you are an employee, it is important to stay up to date with the changes, so you know what your rights are. If you are an employer, there are some action points that you will need to take. 

Employer action points:

• Review workforce and track hours – You should identify the types of contracts workers are on, monitor actual hours, and consider what guaranteed hours may look like based on a 12-week reference period. You will need a system in place to manage offers for guaranteed contracts. 
• Update policies and contracts – Once the detail is confirmed, employers will need to ensure policies and contracts reflect the latest updates for zero and low hour workers. 
• Review shift management practices – Consider systems for how you will offer reasonable notice of shift changes and cancellations. 
• Review agency use – as the changes also impact on agency workers, businesses who use agency workers will want to have systems in place to be able to audit agency worker use and pay.

How can we help?

If you need support with how to respond to the upcoming zero-hour contract reforms, get in touch with our specialist employment law solicitors in Leicester. 

Contact our team by telephone on 0116 247 2000, complete our contact form, or send us an email via info@smithpartnership.co.uk. 

We also have offices across the East Midlands and Staffordshire with expert settlement agreement solicitors, in Burton, Derby, Stoke-On-Trent and Swadlincote.