The Employment Rights Bill in depth: a new era for zero-hours workers?

While the Bill represents a significant step toward providing greater security for workers, it leaves many questions unanswered about how this will work in practice.

A substantial amount of detail remains to be defined in regulations, and practical challenges have been raised about the efficacy of this new regime. For instance, how will employers respond to workers who reject guaranteed hours offers? And could such workers find themselves being offered less and less work as employers prioritise honoring guaranteed hours commitments for other staff?

An attempt to introduce stability

A cornerstone of the Bill is the introduction of a right to guaranteed hours, designed to address concerns about the insecurity faced by workers on zero-hours or low-hours contracts. The system seeks to ensure that workers who consistently work more hours than their contracts stipulate are offered greater contractual stability.

Under the Bill, employers must make a guaranteed hours offer to qualifying workers, based on their average hours worked during a designated reference period. Workers then have a specific response period to accept or reject the offer. This process aims to align contracts with actual working patterns, offering greater predictability to workers.

However, the system is cyclical, meaning that if a worker’s hours increase again after rejecting or completing a previous guaranteed hours offer, the employer will be required to repeat the process and issue a new offer. This creates administrative and practical challenges for employers who must track and respond to fluctuating work patterns over time.

Much of the system’s detail will be determined through future regulations, including:

• The duration of the reference period for calculating average hours
• The length of the response period for workers to consider the offer
• Temporary guaranteed hours for periods of fluctuating demand
• Exemptions for specific industries or roles

The Bill also anticipates scenarios where workers may decline guaranteed hours offers. This raises questions about how such workers will be treated. Will they inadvertently face less favorable treatment as employers seek to comply with their obligations to other staff on guaranteed hours arrangements?

Non-compliance with these provisions could lead to Employment Tribunal claims, allowing workers to seek redress if guaranteed hours offers are not made or fail to meet statutory requirements.

Reasonable notice of shifts and compensation for changes

The Bill introduces new rights for workers to receive reasonable notice of shifts, as well as compensation for late changes, cancellations, or curtailments. Employers will need to provide advance notice of shift schedules, with any late changes triggering compensation obligations.

Where a shift is cancelled, moved, or shortened without sufficient notice, workers will be entitled to compensation. This compensation will not exceed the pay for the lost shift, but the exact amount and definitions of terms such as "short notice" and "qualifying shift" will be outlined in regulations.

The Bill also empowers the Secretary of State to extend these protections to agency workers, though consultation is ongoing to determine how this might work in practice. Employers and agencies will need clarity on how liabilities for last-minute changes will be apportioned, particularly in industries heavily reliant on agency staff.

Temporary guarantees and exemptions

Acknowledging the complexities of fluctuating demand, the Bill allows for temporary guarantees during uncertain periods, such as seasonal peaks. This provision offers flexibility for employers while still providing some level of predictability for workers.

The Bill also anticipates exemptions for specific industries or roles where compliance may be impractical. However, the criteria for these exemptions remain undefined, leaving employers in affected sectors uncertain about how they might implement the changes.

Preparing for change ahead

Although the Employment Rights Bill is still in its early stages, employers should begin considering how its provisions might impact their workforce arrangements. While detailed regulations are awaited, employers can start to:

• Monitor workforce patterns: review the hours worked by zero-hours and low-hours workers to identify potential trends that may require action under the Bill’s provisions
• Assess administrative processes: consider how your organization might manage the cyclical nature of guaranteed hours offers and the tracking of reference periods
• Evaluate flexibility needs: reflect on how temporary guarantees or exemptions might be relevant for your industry and business model, particularly during periods of fluctuating demand

As the Bill progresses and regulations are finalised, engaging with HR professionals and legal advisors will be crucial to ensure your business is prepared for the new obligations. For now, staying informed and assessing potential implications will provide a strong foundation for future compliance efforts.

Balancing flexibility with security

The Employment Rights Bill represents a significant attempt to provide greater stability for workers on insecure contracts. By introducing rights to guaranteed hours, reasonable notice, and compensation for late changes, the Bill aims to address key issues in the modern labour market.

However, its reliance on future regulations leaves employers with considerable uncertainty. The practical challenges of implementing the new rights, including cyclical guaranteed hours offers and the treatment of workers who decline such offers, remain unresolved. Employers must remain alert to developments and take early steps to align their practices with the new requirements.

By doing so, businesses can ensure compliance while creating a more predictable and inclusive work environment.

For more information or advice, please contact Jessica Scott-Dye in our Employment team on 0117 314 5286, or complete the form below.