The provisions are expected to come into force in mid-2027, but employers should begin preparing now. Much of the detail will be set out in secondary legislation, and the current framework leaves a number of unanswered questions. From an employment law perspective, the reforms are likely to create administrative complexity and potential risk for organisations that rely on casual, low-hours or agency workers.
What are guaranteed hours contracts?
Under the new regime, employers will be required to review the hours worked by individuals engaged on zero-hours or low-hours contracts over a defined reference period, expected to be around 12 weeks. If the hours worked during that period show a regular pattern, the employer must offer a contract guaranteeing hours that reflect the average actually worked.
The obligation will be to make the offer, not to impose it. Workers will remain free to decline guaranteed hours if they prefer the flexibility of their current arrangement. However, the duty to monitor working patterns and issue the offer will sit with the employer, and the assessment is expected to take place on a recurring basis.
In practice, the reforms do not ban zero-hours contracts, but they will make it more difficult to rely on them where working patterns are predictable.
Will the rules apply only to zero-hours contracts?
In short, no. The legislation is also intended to capture low-hours contracts, where a worker has some guaranteed hours but regularly works more than those stated in their contract. The precise threshold for what counts as “low hours” has not yet been confirmed and will be set out in future regulations.
This uncertainty makes it difficult for employers to assess the full impact of the reform. Many organisations operate contracts with a small minimum number of hours combined with additional shifts as required. Depending on where the threshold is set, these arrangements may fall within scope of the guaranteed hours provisions.
Agency workers and temporary staff
The guaranteed hours framework will also extend to agency workers and temporary agency staff, reflecting concerns that employers might otherwise avoid the new rules by engaging labour through agencies.
In many cases, responsibility for offering guaranteed hours is expected to fall on the end hirer rather than the agency itself. For businesses that rely heavily on agency labour, this could create additional complexity, particularly where workers move between assignments or work for more than one client. Employers may therefore need to review agency arrangements and ensure that working hours can be monitored accurately.
Why “worker” status matters
The new rights will apply not only to employees but also to individuals classified as workers, a category that sits between employee and self-employed status. Workers are entitled to certain statutory protections, such as the national minimum wage and paid holiday, even though they do not have the full range of employment rights.
The importance of this distinction was highlighted in Uber BV v Aslam, where the Supreme Court held that drivers working through Uber were workers rather than self-employed contractors. The case confirmed that employment status depends on the reality of the relationship, not simply the wording of the contract. As the guaranteed hours rules take effect, disputes about status may become more common.
Preparing for the 2027 changes
Although implementation is still some way off, employers should begin reviewing their workforce arrangements now. Organisations that rely on zero-hours, low-hours or agency workers should consider whether individuals are regularly working consistent hours beyond those guaranteed in their contracts.
Employers will also need systems capable of tracking hours worked across reference periods, as this will be essential for identifying when a guaranteed hours offer must be made. Key details of the regime — including the definition of low hours — are still to be confirmed, and the legislation is widely seen as complex and potentially open to further reform before 2027.
For more information, contact the employment team at Downs Solicitors to see how we can help.
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