Joe McMorrow from Pinsent Masons made the comments following the publication of research by Lancaster University’s Work Foundation, a think tank aimed at improving working life. It has been revealed that the number of people in the UK on zero-hours contracts has reached a record high of 1.23 million. The research, based on ONS data, shows this number has increased by 91,000 in the past year and by 181,000 since July 2024, when the current UK government took office.
Research shows that this growth is being driven by young workers aged 16 to 24, who are five times more likely to work on zero-hour contracts than older workers, as well as individuals without full-time education. Women are 1.2 times more likely than men to work on zero-hours contracts.
In 2027, the Employment Rights Act (ERA) will introduce new rights for zero-hour and part-time workers, including the right to reasonable notice of shifts, the right to payment for canceled, transferred or reduced shifts at short notice, and the right to guaranteed minimum working hours. These rights will also be extended to temporary employees.
McMorrow said the findings demonstrate the magnitude of the challenge for employers preparing for the impact of the ERA’s provisions.
The research found that nine in 10 zero-hour workers in 2023 would have been eligible for guaranteed hours under the government’s original proposal for a 12-week reference period. The Work Foundation also estimates that around a third of workers rely on zero-hour contracts for full-time working hours, indicating that many workers may welcome a move to guaranteed hours. The government plans to begin consultation on these measures soon. Mr. McMorrow said this process will play an important role in shaping the final rights and obligations under this part of the ERA.
“The increase in the number of workers on zero-hours contracts may partly reflect the uncertainty facing employers ahead of the implementation of the Employment Rights Act,” Mr McMorrow said.
“Employers should take proactive steps now towards implementation, including conducting an audit of current working patterns, thinking strategically about future workforce models and reviewing arrangements with agencies. “New or modified conditions should be carefully considered. Employers should also proactively manage working hours before the implementation date to reduce the risk of inadvertently creating a large group of workers eligible for guaranteed hours after the new obligations come into effect,” he said.
“One of the biggest challenges for employers is that key boundaries of the new rules have yet to be set. For example, it remains to be seen what ‘reasonable notice’ of a shift change will be, but this is the point at which mandatory coverage will be triggered. “It’s important because there are no set levels for compensation payments, which means employers are being asked to prepare for obligations without knowing where the line is, and that’s actually creating hesitancy and risk aversion,” McMorrow said.
“Furthermore, the reforms introduce new administrative complexities, such as the need for employers to proactively provide information about some of their employees’ new rights. While the roadmap to implementation is broadly helpful, the lack of clarity on the limits of key obligations means that businesses are preparing for change without being sure of what will ultimately be required of them for compliance,” he added.
