employment-contracts
Zero-hours contracts and guaranteed-hours rights in 2027
How employers using zero-hours and low-hours arrangements can prepare for planned guaranteed-hours, shift-notice and cancellation-payment rights.
The Employment Rights Act programme includes planned rights for zero-hours and low-hours workers to be offered guaranteed hours reflecting work performed during a reference period. It also includes reasonable notice of shifts and payments for some shifts cancelled, moved or shortened at short notice. Detailed regulations and the commencement date were still pending on 30 October 2026, so employers should prepare operational data without writing unconfirmed rules into contracts.
Audit actual working patterns
Start with evidence, not contract labels. For each zero-hours or low-hours worker, review shifts offered, shifts accepted, hours worked, cancellations, notice and periods without work. Look across a representative period and identify people who in practice work a stable weekly pattern.
A contract described as casual does not erase the legal effect of the real arrangement. Regular work, expectations, control and personal service can affect status and rights. If the business consistently relies on someone for predictable hours, a permanent or guaranteed-hours contract may already be clearer for both sides.
Use our contract types comparison guide to compare permanent, fixed-term and zero-hours structures.
Improve shift data and notice now
Record when a shift is offered, its start and end time, when the worker accepts, and any later cancellation or change. Distinguish employer cancellation from worker unavailability. Without reliable timestamps, it will be difficult to calculate future notice or payment obligations.
Set an internal notice standard appropriate to the operation. Emergencies happen, but repeated same-day scheduling transfers business uncertainty to workers and creates avoidable risk. Give workers a clear channel for availability, shift responses and concerns. Train schedulers not to penalise someone merely for declining work where the arrangement gives them that choice.
Review cancellation causes. Forecasting errors, client changes, sickness cover and weather may need different solutions. Better demand planning and a small paid standby arrangement may cost less than frequent future cancellation payments and turnover.
Prepare for guaranteed-hours offers
The final reference period, thresholds, exceptions and offer process will depend on regulations. Build a system capable of calculating average or typical hours without assuming the final formula. Decide who will review data, create offers, record responses and handle repeated reference periods.
An employee may value predictable hours, while another worker may prefer genuine flexibility. The planned model has been described as an offer-based right rather than a universal ban on zero-hours arrangements, but employers should wait for final rules before designing opt-out language.
Where stable hours are already evident, consider voluntary conversion now. Confirm weekly hours, work pattern, flexibility, overtime, pay, holiday and notice in writing. Do not reduce offered work to avoid future eligibility without considering contractual, discrimination and employee-relations risks.
Check holiday pay and payroll
Irregular-hours and part-year workers have specific holiday-accrual rules. Payroll needs accurate hours for each pay period and transparent treatment of rolled-up holiday pay where lawfully used. Do not confuse a future guaranteed-hours reference period with the separate calculation required for holiday entitlement or pay.
Review National Minimum Wage, sleep-in, travel and training time as relevant. A cancellation payment may need its own payroll coding and tax treatment once final rules are known. Ensure the scheduling platform can pass accurate information to payroll without manual reconstruction.
Draft contracts honestly
State whether there is an obligation to offer or accept work, how shifts are offered, how availability is communicated and how either side cancels. Avoid promising complete flexibility while managers expect attendance every week. Include pay, holiday, work location, status, confidentiality, training and notice appropriate to the actual arrangement.
For a real role, start the employment contract builder and select the contract type that matches the intended commitment. Revisit the document when the final guaranteed-hours regulations are published.
Readiness checklist
- identify every zero-hours and low-hours arrangement;
- calculate actual hours over several representative periods;
- record shift offers, acceptance, notice, changes and cancellations;
- investigate recurring short-notice scheduling;
- consider voluntary guaranteed-hours conversions;
- align scheduling, payroll and holiday records;
- train managers on genuine choice and non-retaliation;
- monitor official regulations before changing contractual rights.
This guide reflects the planned reforms as at 30 October 2026. Timing and detailed rules remain subject to regulations and may change. It is general information, not legal advice.
