This blog was co-authored by Laura Wharton and Lydia Lambert.

On 10 October 2024, the Employment Rights Bill (“the Bill”) was published alongside the Government’s ‘Next Steps to Make Work Pay’ plan which outlined its plans to grow the economy and raise standards by tackling low pay, poor working conditions and poor job security.

According to Office of National Statistic’s (“ONS”) figures, over one million employees in the UK were engaged on zero hours contracts as of March 2024 whilst approximately 140,000 agency workers were also reported to be engaged on zero-hours contracts. In an attempt to address issues of “one-sided flexibility” and end the use of “exploitative” zero-hours contracts, the Government has therefore proposed to introduce the following measures within the Bill:

1. The right to guaranteed hours reflecting the hours that qualifying workers have worked during a reference period (anticipated to be twelve weeks); and
2. The right to reasonable notice of shifts and right to payment for shifts cancelled or curtailed at short notice.

Due to the temporary nature of agency work and the tripartite relationship between agency workers, temporary work agencies and end hirers, the Government recognised that the proposed measures would need to be applied differently to agency workers. The Government therefore launched its “Consultation on the application of zero hours contracts measures to agency workers” (“the Consultation”) to seek views as to how such rights should apply to agency workers. The Consultation ran from 21 October 2024 until 2 December 2024, during which a total of 629 written responses were received from an array of stakeholders, including employers, business representative organisations, trade unions, think tanks, academics and legal representatives.

The Government’s official response to the Consultation was published on 4 March 2025, following which a number of tabled amendments were debated in Parliament on 11 and 12 March 2025 as the Bill passed through the House of Commons.

The Offer of Guaranteed Hours

The Bill now extends the entitlement to a contract which reflects hours they regularly work to agency workers as well. The Bill will therefore place an obligation on end hirers to offer guaranteed hours to qualifying agency workers. The rationale behind placing this obligation on end-hirers is due to the Government’s belief that they are “best placed to forecast and manage the flow of future work”. The Bill will also include provisions which will place responsibility on the agency or other entities in certain circumstances, although it is not yet clear where such circumstances may arise.

Provisions within the Bill will still permit end hirers to offer temporary contracts where there is a genuine temporary work need, such as seasonal demand. The Bill also includes provisions to address scenarios where end clients require the engagement of an agency worker on a temporary basis where it has, acting reasonably, requested that the agency stop supplying the worker for reasons such as their capability or conduct.

Reasonable Notice of Shifts and Cancellation of Shifts

Responsibility for providing agency workers with reasonable notice of shifts, shift cancellations and changes will be on both the employment agency and the end hirer. This is an extension of the exiting provisions regarding ‘joint liability’ within agency workers legislation. What is deemed to be ‘reasonable’ notice has still not been confirmed and will likely be subject to further consultation. Within the Consultation, the Government acknowledged that there are circumstances in which short notice may be considered reasonable, however this will need to be defined within secondary legislation.

The Bill further stipulates that the responsibility to pay agency workers for short notice shift cancellations, changes or curtailment payments will be placed on the employment business. The Government believes this to be the most efficient approach on the basis that workers will already be on payroll for the agency. Employment businesses will be entitled to recover an amount from the end hirer which reflects its responsibility for the shift being cancelled, moved or curtailed at short notice. This, however, will only be possible where the arrangement between the employment agency and the hirer was entered into before a date two months after the Bill is passed and remains unmodified.

Next Steps

Following the implementation of the latest table of amendments, the updated Bill is now set to pass through the House of Lords. In comparison to the form in which it was initially proposed, the Bill continues to evolve as the Government attempts to reshape employment laws and practices in the UK.