Guaranteed hours - what we know from the Government's consultation (and what we don't)

The Government has launched a consultation on the “guaranteed hours” provisions of the Employment Rights Act 2025. 

By way of a recap, these provisions require employers to do the following for certain workers and agency workers who are either on zero hour contracts or have a low number of guaranteed weekly hours: 

• offer them a guaranteed hours contract if they have regularly worked in excess of their minimum guaranteed hours
• give them reasonable notice of shifts and shift changes
• pay them compensation for shifts which are changed or cancelled at short notice. 

Ever since the proposals were announced, employers have been keen to understand key details, including what the hours threshold will be, what constitutes “regularly” working in excess of the minimum hours, how much notice they will need to give and how much the compensation payment will be. 

Unfortunately, what is evident from this consultation is that a lot of the key details remain very much up in the air.   For the most part, the Government isn't seeking feedback on a developed set of policy proposals, it's seeking views on what its policy should be.   While this gives businesses a valuable opportunity to influence policy, it also means that the overall direction of travel remains far from clear.  

Threshold and reference periods 

Helpfully, the Government has given an indication of what the threshold will be - i.e. how many hours per week a worker must be guaranteed before they are outside the scope of these provisions altogether.   The Government's preference is for this to be between 8 and 20 hours per week.   At the upper end, this would bring into scope many part-time workers.  

The Government has also given a clear indication of the intended length of the initial reference period (which is used to calculate whether an eligible worker needs to be offered a guaranteed hours contract).  Its preference is for this initial reference period to last 12 weeks for directly engaged workers (although for agency workers it does not have a preferred option and is simply consulting about what the relevant period should be).  

However, it is much less clear what will happen after the initial 12 week reference period.  The Government has suggested that the next reference period will not start immediately after the initial period and that there could be a substantial period (the worked example given suggests 26 weeks) before the next reference period begins.   This would substantially reduce the administrative burden on employers, although it remains to be seen whether this floated idea will harden into Government policy. 

The Government has also suggested that, while the initial reference period will be 12 weeks, subsequent reference periods could be much longer.   Again, this would make life a great deal easier for employers, as short-term surges in demand would be less likely to give rise to an obligation to offer a guaranteed hours contract, but whether this will ultimately be implemented remains to be seen. 

Regularity

The Government is also consulting about how regularly the worker must work in excess of their contractual hours in order for the employer's obligation to be triggered.    The options being considered are i) the worker must carry out work for the employer during a minimum number of weeks in the reference period (e.g. they must have worked for the employer in 8 out of 12 weeks) or ii) as for i) but with an additional requirement as to the total number of hours. 

Seasonal workers 

The new right has caused consternation among businesses with seasonal spikes in demand, as employers will only be allowed to offer guaranteed hours on a fixed term basis in certain scenarios.   The Government doesn't have any new proposals here, but is consulting on what additional flexibility may be needed and whether there should be exemptions.  

Terms of the offer 

The guaranteed hours contract will need to reflect the worker's actual working hours, but the Government is open to views as to whether this should be based on the mean or median, whether the minimum hours will need to be offered on a weekly or monthly basis (or whether this will be left to the employer to decide) and whether employers will be able to adjust the number by a fixed number or percentage (although in either case this would be a minor adjustment only).

Notice of shifts and shift cancellations  

The Government is consulting about what notice of a shift should be deemed to be reasonable - the options set out range from 1 to 4 weeks, but with no preferred policy indicated. 

Employers will need to make a payment to eligible workers if their shift is cancelled, moved or curtailed at short notice - this notice cannot be more than 7 days.   In a new proposal, the Government is also consulting about a tiered system whereby employers would need to make a higher payment for cancelling or changing a shift at very short notice. 

The payment itself will either be a percentage of the amount the worker would actually have been paid for their shift, or a percentage of the National Minimum Wage for the relevant shift.   Importantly, the Fair Work Agency will be able to enforce this obligation and impose additional penalties of up to 50% of the arrears owed to the worker on employers found to be in breach.   This gives some teeth to a right which could otherwise be disproportionately complex or expensive to enforce in the Employment Tribunals. 

Opportunity to have your say!

The consultation document makes it clear that the proposals are still somewhat unformed, with the Government having no preferred option on a whole range of tricky policy questions.   A great deal of detail still needs to be worked out and it seems likely that there would need to be a further consultation once the Government has formulated its proposals.  Although interested businesses should use this opportunity to influence the outcome, it's frustrating that, more than 18 months after the Employment Rights Bill was published, one of its most complex reforms remains in a state of such uncertainty. 

The consultation, Make Work Pay: ending one-sided flexibility – reforms of zero hours and similar contracts - GOV.UK, closes on 25 August 2026.