The UK Government has launched a significant consultation on reforms aimed at tackling what ministers describe as "one-sided flexibility" in the labour market.
The consultation focuses on implementing key measures within the Employment Rights Act 2025, including guaranteed hours for zero-hours workers, reasonable notice of shifts, and compensation for cancelled shifts.
The proposals represent one of the most substantial changes to employment rights in recent years and could reshape how employers manage flexible workforces across multiple sectors.
Why the Government Is Taking Action
In the consultation's foreword, Business Secretary Peter Kyle and Employment Rights Minister Kate Dearden acknowledged that zero-hours contracts can provide valuable flexibility for both employers and workers. However, they argued that flexibility should not come at the expense of basic security and predictability.
Ministers highlighted situations where workers regularly perform substantial hours for the same employer over several years without any guarantee of future work. Many employees can be informed about shifts at short notice or arrive at work only to discover their shift has been cancelled without pay.
According to the Government, these practices create financial uncertainty and instability for workers who depend on regular income to manage their everyday lives.
What the Consultation Covers
The consultation seeks views on several key aspects of the proposed reforms, including:
Employer Concerns Over Complexity
While many support the principle of improving worker security, employer groups have raised concerns about the practical implications of the reforms.
Ben Willmott, Head of Public Policy at the CIPD, argues that well-managed zero-hours contracts already offer valuable flexibility for employers and individuals who cannot commit to fixed working patterns, including students, carers, and people managing health conditions.
He warns that the proposed regulations could become highly complex, particularly for small businesses and organisations experiencing fluctuating demand. Determining guaranteed hours, managing shift notifications, and responding to unexpected absences may create significant administrative challenges.
There are also concerns that overly restrictive regulations could lead employers to seek alternative forms of workforce flexibility, such as increased use of self-employed contractors or fixed-term contracts, potentially creating new forms of insecurity rather than reducing them.
Recruitment Industry Sounds the Alarm
The recruitment and staffing sector has been particularly vocal about the potential consequences of the reforms.
Neil Carberry, Chief Executive of the Recruitment and Employment Confederation (REC), argues that poorly designed legislation could reduce employment opportunities, particularly for young people and vulnerable workers who rely on flexible work arrangements.
Similarly, Tania Bowers of APSCo UK and OutSource has described the proposals as a potential threat to the temporary contracting sector. She warns that businesses facing higher compliance costs may increasingly turn to offshoring, automation, or operating with reduced headcounts instead of hiring temporary staff.
These concerns come at a time when many employers are already grappling with rising employment costs, labour shortages, and economic uncertainty.
A Long-Awaited Reform for Workers
Worker advocates and employment researchers, however, see the consultation as a crucial step towards addressing insecure work.
Alice Martin of the Work Foundation at Lancaster University notes that more than 1.2 million people are now employed on zero-hours contracts—the highest level since records began. Furthermore, over 400,000 workers rely on such contracts as their primary source of full-time employment despite having no guaranteed hours or income.
Supporters argue that the right to guaranteed hours, advance notice of shifts, and compensation for last-minute cancellations will provide greater financial stability and improve workers' ability to plan their lives.
For many, these reforms are viewed as a necessary modernisation of employment law that reflects the realities of today's labour market.
Finding the Right Balance
The challenge facing policymakers is finding the right balance between flexibility and security.
Employers need the ability to respond to changing customer demand, seasonal fluctuations, and unexpected absences. At the same time, workers deserve a degree of certainty regarding their hours, income, and working patterns.
The consultation period presents an opportunity for businesses, trade unions, workers, and industry groups to influence how these reforms are implemented. The final framework will need to protect vulnerable workers without creating barriers to employment or undermining the flexibility that many people value.
Looking Ahead
As the consultation progresses, all eyes will be on how the Government navigates competing interests from employers, workers, unions, and industry bodies.
The outcome could fundamentally reshape the future of flexible working in the UK. If implemented effectively, the reforms may provide millions of workers with greater stability while preserving the flexibility that remains an important feature of the modern labour market.
What is clear is that the debate over zero-hours contracts is far from over, and the decisions made in the coming months will have lasting implications for employers and workers alike.
Source: Personnel Today
