Are Zero Hours Contracts still legal?

Zero Hours Contracts - Are they still legal?

As of July 2025, zero-hours contracts are still legal in the UK, but significant reforms are underway as part of the Employment Rights Bill. Here's where things currently stand and what’s coming:

Current Legal Position

• Zero-hours contracts remain lawful, meaning employers can offer work without guaranteeing minimum hours.

• Workers on these contracts are not obliged to accept shifts, and employers cannot prevent them from working elsewhere.

• However, new protections are already in place or being phased in:

  • Right to reasonable notice of shifts

  • Compensation for last-minute cancellations

  • Right to request a contract that reflects regular working hours after a defined reference period

  • Protection from unfair dismissal and detriment for asserting these rights

These changes aim to curb “one-sided flexibility”—where employers benefit from flexibility but workers bear the uncertainty.

What’s Coming Next

• A ban on exploitative zero-hours contracts is expected to come into force in 2027, as part of a phased rollout of the Employment Rights Bill.

• Workers who regularly work consistent hours will have the right to a guaranteed-hours contract.

• The government has committed to consulting on the finer details, such as what counts as “regular hours” and how long the reference period should be.

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What Employers Should Do Now

• Review current contracts and shift allocation practices

• Prepare to offer more predictable working patterns

• Consider how to handle requests for guaranteed hours

• Stay alert for further guidance and implementation timelines

These reforms are part of a broader push to “make work pay” and ensure fairer treatment for all workers, especially in sectors like hospitality, retail, and care where zero-hours contracts are common.

Zero-Hours Contract Readiness Checklist (2025–2027)

This checklist is designed to help SMEs prepare for upcoming reforms.

The goal: ensure fair working conditions, reduce risk, and stay one step ahead of legislation.

 Contract Review

[ ] Audit existing zero-hours and casual contracts for clarity and compliance

[ ] Remove exclusivity clauses that prevent workers from seeking other employment

[ ] Include clear terms around shift allocation and cancellation policies

[ ] Flag contracts likely affected by reference period calculations

 Shift Scheduling & Notice

[ ] Introduce a fair and consistent shift notice policy

[ ] Define what counts as reasonable notice within your business model

[ ] Record shift offers and cancellations for audit purposes

[ ] Plan for compensation procedures if shifts are cancelled at short notice

Worker Communication & Requests

[ ] Create a transparent process for workers to request guaranteed-hours contracts

[ ] Identify the reference period that will apply (once government confirms details)

[ ] Educate managers on new unfair dismissal protections for workers asserting these rights

[ ] Promote internal guidance on handling contract change conversations

Data & Policy Readiness

[ ] Track and review average hours worked per contract type

[ ] Monitor usage of agency and annualised hour workers

[ ] Document any patterns of “regular work” that may trigger new entitlements

[ ] Update handbooks, onboarding packs, and training where needed

Prepare for Consultation & Compliance

[ ] Monitor government consultation outcomes (late 2025–2026)

[ ] Consider joining trade groups or HR networks to stay informed

[ ] Be ready to respond quickly once reference periods and qualifying conditions are confirmed

[ ] Engage HR or legal partners early to support transition planning