While guaranteed hours may grab the headlines, the consultation on shift scheduling rights highlights that these rights could ultimately prove to be the more impactful reform for workers in practice.
Alongside the guaranteed hours regime, the Employment Rights Act created three new rights:
- The right to reasonable notice of shifts
- The right to reasonable notice of shift changes or cancellations
- Payment for cancelled, moved or curtailed shifts
We consider these new rights in detail here.
The government have now launched a hotly anticipated consultation on the zero-hour reforms. We consider the guaranteed hours part of the consultation here. This insight considers the various options being considered for shift scheduling provisions. Unlike the guaranteed hours proposal, the government have not expressed any preference for the options suggested so it remains difficult to gauge where the final regulations could land.
What is the government proposing?
Here’s a summary of the key issues covered by the consultation:
| Issue | Options consulted on | The practical impact |
Low hours threshold The maximum number of contractual hours a worker can have and still be eligible for the shift scheduling rights. | Between 8 and 48 hours per week (in 4-hour increments). This mirrors the approach and options for guaranteed hours. However, the government have stressed that the hours threshold does not need to be aligned across guaranteed hours and shift scheduling rights. | The higher the threshold, the more people will be brought into scope. The considerations are different here to guaranteed hours. Even those with higher minimum hours may have unpredictable schedules and so certainty around shift timings can still be important. |
Notice presumed reasonable The starting point for tribunals assessing whether an employer gave adequate notice of a shift. | 1 week, 2 weeks, 3 weeks or 4 weeks for directly engaged workers. However, the government recognises that what is “reasonable” will depend on the circumstances. If an employer gives less notice than the presumed period, the burden falls on them to show it was reasonable in the circumstances. The government are also consulting on the factors tribunals should consider when determining whether notice was reasonable or not. | Research cited in the consultation found that over half of workers with variable hours received less than a week’s notice of shifts. Setting the presumption at more than a week would therefore represent a significant shift in practice for many employers, particularly in hospitality and retail where demand-driven scheduling is the norm. |
Short notice period The window within which an employer cancelling, moving or curtailing a shift triggers a payment obligation. | 1, 2, 3, 5 or 7 days (it cannot exceed 7 days under the Act). The government is also considering introducing a “very short notice” period (up to 5 days), which would trigger a higher payment. | A two-tier payment system will bring more complexity but recognises that shorter notice can be more disruptive for individuals. For example, cancelling on the day of a shift can impact arranged childcare, paid for travel or other work. |
Short notice payment amount How the payment is calculated in relation to how much a worker would have earned had the shift been worked. | Option 1: a percentage of what the worker would have earned (options ranging from 10-80% for a short notice payment and 30-50% for a very short notice payment). Option 2: a percentage of what the worker would have earned at the National Living/Minimum Wage rate. | Option 1 could attract costly payments, particularly for employers who engage higher paid staff. Option 2 could result in a higher-paid worker losing proportionally more from a cancellation or moved shift than a lower-paid worker. |
Exceptions Circumstances in which no payment is due despite short notice. The Act already provides that no payment is due where the cancellation is initiated by the worker — including where workers voluntarily swap shifts or where a worker simply does not turn up. | The consultation asks whether exceptions should exist, for example extreme weather events or widespread power outages. | Little information is given on scenarios the government is considering here. The examples given make obvious sense for genuinely unforeseeable events, but the scope of exceptions will be critical. If drawn too widely, they risk undermining the right altogether; if drawn too narrowly, employers face paying cancellation costs even where the cancellation was entirely outside their control. |
Agency workers
The new rights will also apply to agency workers and the government is broadly suggesting the same approach, although there are some nuances. For example, the government have suggested excluding agency workers from scope if they have a contract guaranteeing hours above the threshold across different hirers.
The government also recognise that agency work is inherently more reactive. The consultation therefore suggests a shorter threshold for presumed reasonable notice for agency workers, including an option for below five days.
There is an additional possible exemption for hirers being considered. Under the Act, the agency has the obligation to make the short notice payment but they can recoup the cost from the hirer to the extent the hirer was responsible. The consultation asks whether certain types of hirers — such as vulnerable individuals receiving care — should be shielded from recoupment and from being added to tribunal proceedings. This is a narrow scenario but could be impactful in the care sector.
Could the regulations water down the rights?
Possibly, but it depends on where the government lands. There are some options being considered, particularly relating to how a cancellation payment could be calculated, which many employers would welcome and could reduce the financial impact of the new rights.
Payment may not be linked to contractual pay
The consultation presents two options for calculating the payment. The government's stated aim is twofold: to incentivise better workforce planning and to ensure that workers do not bear all the financial risk of last-minute changes. Under option 1, the worker receives a percentage of what they would actually have earned; under option 2, the percentage is applied to what they would have earned at the National Living/Minimum Wage rate. This could considerably reduce the amount payable by the employers.
Example
Consider Bryn, a 45-year-old marketing consultant who was due to work five-hours at £45 per hour. Let’s presume the payment rate is set at 30%. If his shift is cancelled at short notice, how much would he receive?
Under option 1, he would receive £67.50 (30% × 5 × £45).
Under option 2, his payment drops to £19.07, calculated against the national living wage rate of £12.71 per hour.
Option 1 more closely reflects the actual financial impact on the worker and is arguably more likely to achieve the government's aim of incentivising employers to plan effectively, since the cost of cancellation scales with the cost of the worker. It would also better fulfil the government’s intention for workers to receive a payment related to “how much they would have earned had they worked the shift as expected”.
However, this could be a high cost for employers who have highly paid zero hours workers. The Act specifically permits future regulations to put a financial ceiling on those in scope for these new rights, meaning that high earners with variable hours may not qualify. However, there is no mention of this earnings cap in the consultation. Linking any payments to the statutory rates could be an alternative way of mitigating the financial impact on employers in demand driven industries.
Low percentage payment
The percentage itself is also an important variable for employers. Where the percentage lands will determine whether the right has real teeth.
Example
Angharad is engaged on a zero hours contract to work as a sales assistant in an ice-cream kiosk. She earns £15 an hour. She is scheduled to work an 8-hour shift on Saturday but a couple of days before bad weather is forecast and her employer needs to reduce the number of staff scheduled to work.
If the short notice payment amount is set at 10%, Angharad would receive a nominal payment of £12. Whereas, if set at 80% she would receive £96.
Factors to rebut presumption
The factors to determine when less notice than the presumed standard is reasonable will also be key.
The consultation asks open-ended questions about circumstances in which longer or shorter notice should be expected. There is little insight given here but the government say shorter notice could be reasonable if seeking cover for an employee who has called in sick. Another factor mentioned is if a worker is contractually obliged to work any shift offered to them, more notice should be offered than if they would be free to decline a shift.
Employers will be keen to ensure this includes as many scenarios as possible. If it were to cover last minute increases in customer demand, as well as cover for unexpectedly absent employees, without risking a tribunal claim, that would minimise the impact of this right for employers.
Example
On Tuesday, a ten-pin bowling alley receives a request for a large birthday party the following weekend. Profits have recently taken a hit after an unexpected heatwave and so the manager is keen to accommodate. They need 2 additional members of staff to cover lane support and the bar. Would a late party booking justify lower notice being given to staff?
Could the regulations add even more complexity?
On the other hand, there are some proposals which could further add to the administrative burden on employers. Already one of the main criticisms of the proposed new rights is how onerous they will be for employers. There are currently no statutory rights to notice of shifts or work schedules so these new rights will inevitably create additional work for employers, possible requiring investment in new HR technology systems.
The proposal for a two-tier system could be particularly tricky for employers. A two-tier system would double the number of variables employers need to track: two time periods, two payment rates. For, say, a large retailer managing thousands of shift workers, the administrative burden of distinguishing between "short" and "very short" notice cancellations across the workforce could be considerable.
The government itself acknowledges the tension between recognising the increased inconvenience for last minute cancellations and keeping the system simple enough for businesses and workers to understand.
New enforcement route
When considering the practical impact of these rights, the proposals around enforcement are significant.
The Fair Work Agency was established earlier this year. The government is consulting on whether the Fair Work Agency should enforce the right to short notice payments, using its existing Notice of Underpayment civil penalty regime.
The other rights in this regime, particularly guaranteed hours and reasonable notice, would be enforced exclusively through the employment tribunal system, requiring workers to bring individual claims. The tribunals are currently under a lot of strain and seeing a claim through from start to finish can now take years. Litigation can also be a daunting prospect, particularly for low-paid workers who may not be able to get legal advice.
The government itself acknowledges that guaranteed hours and reasonable notice involve "more complex assessments" making them less suited to state enforcement. Short notice payments are different. Not paying a short notice payment is, as the government puts it, "a discrete, measurable event with a clear financial impact".
Either the shift was cancelled at short notice and the payment was made, or it was not. This binary quality makes it more suited to enforcement by the Fair Work Agency. If this proposal is adopted, the right to short notice payments could become the most practically effective of all the zero hours reforms and the bigger practical risk for employers.
The Fair Work Agency could issue Notices of Underpayment to enforce the right to short notice payments, which would require the employer to pay the worker the money owed. In addition, the Fair Work Agency could impose penalties.
The proposed penalty regime has been pitched lower than the minimum wage penalties. The lowest options being considered are a penalty of 50% of arrears owed, with a minimum of £100 per case and a maximum of £5,000 per worker. Even at this level, the cumulative exposure for an employer routinely cancelling shifts without payment across a large workforce could be significant. However, the government is also considering an option aligned with minimum wage penalties – 200% of arrears owed and a maximum of £20,000 per worker.
What should employers do now?
Although the government haven’t indicated their preferred options, the shift scheduling rights are shaping up to be fundamental in practice. The proposals are in many ways simpler than the guaranteed hours regime and more directly address perceived power imbalances. Of course, the regulations are still needed to confirm how these rights will operate.
Whilst there is still no need for employers to take any immediate action, employers can begin preparing by:
- Consider customer demand. Where the resource needed can fluctuate because of external factors, like the weather, begin tracking any seasonal trends to support your shift scheduling.
- Audit shift scheduling. Where shifts fluctuate throughout the year, consider auditing shift patterns and how much notice is currently given to workers. Employers should also check contracts for any existing rights to notice of a shift (or a cancellation payment, although these are unusual).
- Software support. Explore capabilities of any existing software or tools to support with scheduling and communications.
The consultation gives no further indication of when the new rights will take effect, and so employers should prepare on this basis it will be during 2027, in accordance with the government roadmap.
The consultation closes on 25 August 2026 and can be viewed here. Lewis Silkin will be responding to this consultation and are keen to hear your views. If you would like to discuss how these proposals could impact your business, please get in touch with your usual Lewis Silkin contact.