On 2 June 2026, the government launched its consultation on reforms to zero hours and similar contracts. The government states “it is not banning zero hours contracts” but its aim is to reduce the insecurity of hours and income that some workers face. The government’s intention is that once the reforms are implemented, in-scope workers will have:
- a right to guaranteed hours, where the number of hours offered reflects the hours worked by a qualifying worker during a reference period;
- a right to reasonable notice of shifts; and
- a right to payment for shifts cancelled, curtailed, or moved at short notice.
The reforms set out in the Employment Rights Act 2025 (the “ERA 2025”) have not yet taken effect and regulations will be required to outline key details. This is the focus of the consultation, following which the government will develop final policy positions to deliver the measures.
What are the government’s objectives?
The government has three main objectives which guided the drafting of the consultation, and which will guide the final policy decisions:
- Establish a baseline of security and stability for workers facing unpredictable hours so they can plan their lives more effectively.
- Rebalance labour market flexibility so it works for both workers and employers.
- Support sustained economic growth across the diverse range of industries that make up the UK economy.
What areas does the consultation cover?
- Hours threshold: The intention of the hours threshold is to include workers who are guaranteed some hours but experience unpredictability of hours and income in a similar way to zero hours workers. The government’s preference is to set the threshold within the range of 8 to 20 hours per week.
- Length of reference periods: This relates to the period in which a guaranteed hours offer is calculated. The government’s preference is for the initial reference period to be 12 weeks long. After the initial period there will be a subsequent reference period and the consultation seeks views on how this should work.
- Regularity of work: To qualify for a guaranteed hours offer, a worker must have worked with sufficient regularity during the reference period. Two options are being consulted on: Option A requires hours to be spread across a minimum number of calendar weeks, whilst Option B adds a minimum total hours threshold to the weekly distribution requirement. The government does not state which is its preference.
- Seasonal work and definition of ‘temporary need': Employers can use limited-term contracts to manage periods of increased demand (for example, due to seasonal fluctuations). An employer need not make a guaranteed hours offer where a worker is on a limited-term contract shorter than the reference period, provided that contract was reasonable. The Act defines a limited-term contract as reasonable where the worker is needed only: (i) to perform a specific task; or (ii) until a particular event occurs or does not occur; or (iii) for another “temporary need” as defined in regulations.
- Guaranteed hours calculation: The guaranteed hours offer will need to reflect the number of hours a qualifying worker worked during a reference period. The government is consulting on whether this should be a mean or median average.
- Exemptions or exclusions for guaranteed hours: The ERA 2025 provides a power to exclude workers of a specific description from the guaranteed hours rights (e.g. workers who have more than one contract with the same employer and one of these contracts exceeds the hours threshold). It also includes a power to exempt employers from the duty to make guaranteed offers in certain circumstances (e.g. in exceptional circumstances such as business closures due to flooding). The consultation seeks views on these exclusions and exemptions.
- Reasonable notice of shifts, payment for shifts cancelled, moved or curtailed at short notice: The government aims to give workers greater certainty about when they will be working, the number of hours and their income, to enable them to plan their lives more easily and to balance multiple jobs. Accordingly, the consultation asks a variety of questions across each of these themes such as the length of “short-notice” and calculations for “short-notice payments”. It also looks at the enforcement of short notice payments by the Fair Work Agency.
Next steps
The consultation runs until 25 August 2026. If you are interested in responding to the consultation, please see here.
For more information on the Employment Rights Act 2025 please see our tracker and contact Nick Marshall, Leanne Raven or your usual Linklaters contact.
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