Zero-hours, low-hours and casual workers: what the Employment Rights Act 2025 changes 

The Employment Rights Act 2025 received royal assent on 18 December 2025, marking significant reform of the law on casual working arrangements. The act introduces new statutory rights for workers on zero‑hours, low‑hours, and certain agency arrangements, with detailed rules to be finalised through secondary legislation.

Implementation of these changes will be phased in throughout 2026 and 2027.

Employers that operate variable hours workforces (particularly in sectors such as hospitality, retail, health and social care) should begin preparing now.

Who the new rules apply to

A worker will likely be in scope where, during the reference period, the individual works under a zero‑hours arrangement (with no certainty of any work), or a low‑hours contract (some guaranteed hours but low amounts), and regularly works over the contractual minimum, (the “low‑hours” threshold will be defined in due course).

The reference period is expected to be 12 weeks (the exact period is yet to be confirmed).

Key Dates for the Employment Rights Act 2025 and How Employers Can Prepare

Duty to offer mandatory guaranteed hours

The act introduces a new statutory duty on employers to offer guaranteed hours that reflect the hours a worker has worked during the given “reference period”.

This applies to:

• Zero‑hours workers
• Workers on low‑hours contracts who regularly exceed their minimum hours
• Relevant agency workers

Workers may decline the offer and remain on zero‑hours, but employers must re‑assess and re‑offer the worker guaranteed hours at the end of each reference period.

What this means for employers: You will need to monitor working patterns closely, track the workers’ reference periods, and be ready to issue guaranteed‑hours offers when appropriate.

Unfair Changes to Unfair Dismissal Under the Employment Rights Act 2025

Notice requirements for shifts

Employers will be legally required to give workers reasonable advance notice of:

• Their shifts (specifying details such as the date, the start and end time, and the number of hours to be worked)
• Any date/time changes to shifts
• Any shift cancellations

The regulations will specify what counts as “reasonable”.

Practical impact: Businesses that routinely schedule shifts at short notice will need to review their rostering practices and introduce robust planning systems to justify any deviations.

Key Dates for the Employment Rights Act 2025 and How Employers Can Prepare

Short-notice cancellations and compensation

Where a shift is cancelled, moved or curtailed at short notice, workers will be entitled to a statutory payment.

Although the act confirms the right, the “short‑notice window” and payment level will be set through secondary legislation following consultation. The previously suggested seven‑day window is not fixed in the act.

HMRC has confirmed these payments will be treated as taxable earnings subject to PAYE and NICs.

Protections against dismissal and detriment

Workers will be protected from detriment or dismissal for:

• Accepting or rejecting a guaranteed‑hours offer
• Declining a shift because reasonable notice was not given
• Challenging non‑compliance or bringing a claim

Unfair Changes to Unfair Dismissal Under the Employment Rights Act 2025

Written information requirements

Employers must take reasonable steps to ensure workers receive written information about their guaranteed‑hours rights within two weeks of starting work or becoming a qualifying worker.

What the changes mean for agency workers

The act extends guaranteed‑hours and scheduling rights to agency workers, though the exact allocation of duties between the hirer, agency, and payroll intermediaries is yet to be clarified.

The default position is expected to place the guaranteed‑hours duty on the hirer, with agencies generally responsible for making short‑notice payments (with recoupment rights).

Employment Rights Act 2025: What Employers Need to Know 

When these changes take effect

2026 – Consultations on reference periods, low‑hours thresholds, notice periods and payment rules will begin.

2027 – Expected commencement of the full guaranteed‑hours and scheduling regime.

Key Dates for the Employment Rights Act 2025 and How Employers Can Prepare

What if an employer gets it wrong?

Expect tribunal claims for any breaches of the guaranteed hours/notice/payment duties and detriment/unfair dismissal risks if workers are penalised for asserting these rights.

Practical steps for employers

1. Review your variable workforce: Identify all zero‑hours, low‑hours and agency engagements likely to fall within the new regime.
2. Implement hour‑tracking systems to ensure that you can calculate reference‑period patterns accurately.
3. Update your rostering and notice practices in preparation for the statutory “reasonable notice” requirements and the documentary evidence needs that will come with those requirements.
4. Create workflows for short‑notice payments, budget for them and prepare payroll (including PAYE/NIC rules).
5. Update your onboarding materials to include the required written information about the workers guaranteed hours rights, within two weeks of start/eligibility.
6. Review your agency supply chains to clarify who is responsible for guaranteed‑hours offers and cancellation provisions.
7. Train your managers on the detriment risks, scheduling obligations, and how to avoid inadvertent retaliation.

Employment Rights Act 2025: What Employers Need to Know 

Important information

This article provides general guidance only and should not be treated as legal advice.