Zero-Hours Regulations Consultation 2026 - Guaranteed Hours Thresholds, Shift Notice and Cancellation Pay

The Department for Business and Trade's consultation on reforming zero-hours and similar contracts closes at 11:59pm on 25 August 2026. It is the exercise that settles the working detail of the three new rights created by the Employment Rights Act 2025: guaranteed hours, reasonable notice of shifts and payment for shifts cancelled, moved or curtailed at short notice.

The Act sets the framework, but almost every number that matters is being decided in the regulations this consultation feeds. Who counts as a low-hours worker, how long the reference period runs, what notice is presumed reasonable and what a cancelled shift costs an employer are all still open questions.

This article sets out what is on the table, where the government has stated a preference, and what employers who rely on variable-hours rotas should be doing while the detail is finalised. For the rights themselves, our guide to the zero-hours contract changes expected in January 2027 covers the regime in full.

The Questions Being Decided

Why the Regulations Matter More Than the Act

The Employment Rights Act 2025 received Royal Assent with the zero-hours measures in outline only. The government's implementation roadmap places commencement in the 2027 wave, and the precise date will be set by the same regulations that fix the numbers above. Our Employment Rights Act timeline tracks the full sequence of changes.

The threshold decision alone determines whether whole workforces are in or out of scope. A business whose casual staff sit on 16-hour contracts is fully inside the regime if the threshold lands at 20 hours and largely outside it if the threshold lands at 8.

The government has said its preference is a threshold between 8 and 20 hours per week, on the basis that workers on very low guaranteed hours experience the most one-sided flexibility. Consultation responses will shape where in that range the final figure falls.

The Low-Hours Threshold

Workers on zero-hours contracts qualify for the new rights automatically. The threshold question decides how far up the hours scale the rights extend, with options presented from 8 to 48 hours per week.

There is a separate threshold question for the rights to reasonable notice and short-notice payments, which could be set at a different level. The consultation also proposes that a worker who accepts a guaranteed-hours offer above that threshold would fall out of scope of the notice and payment rights, since guaranteed hours reduce the need for them.

The Reference Period and the Regular Working Test

Guaranteed hours work on a reference period. At the end of it, a qualifying worker must be offered a contract guaranteeing hours that reflect what they actually worked, and the government's stated preference is an initial reference period of 12 weeks.

Not every worker who picks up occasional shifts would qualify. The consultation proposes a regular working test, with options requiring work in 6, 8 or 10 calendar weeks of a 12-week period, and a possible minimum number of excess hours on top of contracted hours. One worked example requires a worker on 24 contracted hours per week to work at least 120 hours across the 12 weeks, in at least 8 separate weeks, before an offer is due.

The consultation also asks whether employers should be allowed a small adjustment margin when calculating the offer, either a fixed figure such as 2 hours or a percentage such as 10 per cent. Subsequent reference periods could stay at 12 weeks or extend to six months or a year, which would significantly reduce how often offers have to be recalculated.

Reasonable Notice of Shifts

The Act deliberately avoids a fixed notice rule. Instead, regulations will set a period of notice that is presumed reasonable, and the consultation offers options of 1, 2, 3 or 4 weeks for directly engaged workers.

The presumption sets the burden of proof at tribunal. An employer who gave less notice than the presumed period must show it was reasonable in the circumstances; a worker who received more than the presumed period must show it was not.

Tribunals will also weigh factors set out in regulations, such as whether the worker was contractually obliged to accept offered shifts and whether the employer was covering unexpected absence. Where notice is found unreasonable, the worker can recover compensation for the loss suffered.

Payment for Cancelled, Moved or Curtailed Shifts

Employers will have to pay eligible workers when a shift is cancelled, moved or curtailed at short notice. The Act caps the definition of short notice at 7 days, and the consultation offers options from 1 to 7 days, along with a possible two-tier structure where a higher payment is due for very short notice.

On the amount, the options are a percentage of what the worker would have earned from the lost hours, calculated either at their own rate of pay or at the National Living Wage rate. The percentages consulted on run from 10 to 80 per cent, and the Act prevents the payment exceeding what the worker would have earned.

No payment is due where the worker initiates the change. A worker who cancels their own shift, fails to attend or voluntarily swaps a shift with a colleague triggers no liability, a point Acas guidance on zero-hours contracts is expected to reflect once the regime is in force.

Agency Workers

Agency workers are inside the regime. For reasonable notice, both the agency and the hirer carry the duty, and a tribunal can apportion liability between them according to responsibility for the failure, mirroring the joint liability concept in the Agency Workers Regulations 2010.

Short-notice payments to agency workers are made by the agency, which can recoup the cost from the hirer where the hirer was responsible. The consultation also asks whether agency workers who already hold guaranteed hours above the threshold, from their agency or for a specific hirer, should be excluded.

What Happens After 25 August

The government will analyse responses and publish its formal response, followed by draft regulations fixing the thresholds, periods and percentages. The DBT zero-hours factsheet and the implementation roadmap both point to commencement during 2027, and we expect the January 2027 window remains the working assumption.

We will update this article when the consultation response is published and the final figures are known.

What Employers Should Do Now

The final numbers are unknown, but the direction is not. Employers using zero-hours, low-hours or short-notice rota patterns can prepare on any threshold outcome:

• Map your workforce by contracted hours, so you know instantly who falls in scope at an 8, 16 or 20 hour threshold.
• Measure your current notice practice. If rotas routinely publish less than a week ahead, the gap to any presumed reasonable period is your operational risk.
• Track shift cancellations, movements and curtailments, including who initiated them, so you can model the cost of each payment option.
• Review contracts, rota procedures and handbook wording now, so the changes land as an update rather than a rewrite.

Guaranteed-hours offers will also need a calculation and record-keeping procedure of their own, which is worth designing before the first reference period starts running.

Zero-Hours Policy and Procedure Writers

Policy Pros writes the working documents this regime will test: rota and shift-notice procedures, cancellation and payment policies, casual worker contracts and the handbook sections that tie them together. Our HR policy writing service starts with a gap analysis against the incoming requirements, and our employee handbook service keeps the whole document set consistent.

If your business relies on variable-hours staff and you want your procedures ready before the regulations land, contact us for a free quote.