The second part of the Government’s intention to provide more predictability for workers on zero-hour contracts and low guaranteed-hour contracts is to ensure they are given reasonable notice of shifts and are compensated when those shifts are cancelled or curtailed or changed at short notice. As with part one of this blog and the mechanics of the guaranteed hours offer regime, the devil is in the detail; who will come within the scope of these provisions and what will the subsequent administrative burden look like? The Government has again given some idea of the direction of travel and the mechanics of this in its consultation document, but again, there are still so many gaps to be filled in. 

{This blog looks only at directly employed workers for the sake of brevity; however, it is worth remembering that agency workers will also be impacted by this right as well.} 

• Eligibility
  • The ERA 2025 notes that all workers on zero-hour contracts and those on some guaranteed hours contracts will be eligible for these provisions. For those latter contracts, the Government is proposing an ‘hours threshold’ for the right to reasonable notice and short notice payments. This mirrors the GHO regime (see our blog part one for details of eligibility) although rather confusingly, the thresholds may be different.
  • The Government is consulting on what the weekly hours threshold for the right to reasonable notice and short notice payments should be – the hours range from 8 to 48
  • Couple of things to note from this. First, the Government does address the issue that some guaranteed hours are over a month, not a week and promises that regulations will take account of that. Second, given the Government notes that it ‘does not want to interfere unnecessarily with overtime arrangements for workers who already have a good number of guaranteed hours’, we cannot see how setting the hours threshold at the higher end of that range would be consistent with this messaging. 
     
• Reasonable notice
  • If an employer does not give reasonable notice of a shift, the worker will be entitled to pursue a case at tribunal. The Government recognises the difficulty of setting a fixed period of notice for all scenarios and circumstances. What is reasonable will depend on the circumstances.
  • The Government is proposing a presumption of what is reasonable notice – could be 1,2,3, or 4 weeks
  • If an employer gives less than the presumed reasonable notice, they will then need to establish it was reasonable in the circumstances.
  • The Government asks what factors should be considered by a tribunal to determine whether notice was reasonable and whether some circumstances warrant longer notice and some shorter?
  • Depending on what presumption of reasonable notice is agreed, this has the potential of adding to an employer’s administrative burden. For many employers, a four-week notice period of shifts may be unworkable and so the need to document the reason for giving less than this presumption in each case is going to be a huge administrative burden. Many might just take the risk that employees will not pursue the claim and so they will not have to justify their decisions. 
     
• Compensation for shifts cancelled, moved or curtailed at short notice
  • The Government notes that the purpose of this measure is to incentivise employers to ‘plan more effectively so they do not need to cancel or change as many shifts at short notice’.
  • This will not apply when two workers voluntarily agree to swap a shift – the worker who gives up the shift will not be eligible for compensation or short notice payment. 
     
• What is short notice?
  • The ERA 2025 does not permit short notice to be more than 7 days.
  • The Government is consulting on how many days short notice should be between 1 and 7 days
  • The Government is consulting whether there should be a further very short notice period and what that should be between 1 and 5 days and an increased payment due in those circumstances.
  • This latter proposal would add yet another layer of administration to an already complex system. It would only be relevant, we presume, if the short notice definition was agreed at the higher end of the range of 1 – 7 days. 
     
• What is the short notice payment/compensation?
  • The Government is suggesting the following options for calculating payment:
    • Option 1 – percentage of what the worker would have earned from working the shift that was cancelled or curtailed
    • Option 2 – percentage of what the worker would have earned from working the shift at the National Living/National Minimum Wage.
  • The Government is consulting on which option to use to calculate the payment and what the suggested percentage should be between 105 and 80% for each option
  • In addition, if the very short notice payment was introduced, what percentage would apply between 30% and 80% for each option
     
• Exceptions to right to pay short notice payments
  • The Government addresses whether there are circumstances when an employer is not required to make these short notice payments.
  • The Government asks what circumstances should qualify as exceptional circumstances? 
     
• Enforcement
  • Enforcement of these provisions will be with both the tribunal system and the Fair Work Agency (operational from April 2026).
  • The Government anticipate that the FWA will enforce the right to short notice payments, whereas other zero-hour issues will be addressed through employment tribunals.
  • It’s likely that the FWA will use the Notice of Underpayment civil penalty regime to enforce rights regarding non-payment or underpayment; presently this is the regime used to enforce underpayment of national minimum wage. However, the Government is considering whether this regime will need to be adapted to apply more effectively for the different circumstances of short notice payments. For example, whether the current default penalty of 200% of the amount owed to a worker (maximum of £20,000) should be introduced at a lower rate of 50% of the arrears, with a maximum penalty of £5,000 per worker. 

Next steps

Echoing our previous blog, there are still details to be drilled down to understand the new regime fully for reasonable notice and short notice payments, but we are starting to see a direction of travel from the Government. Again, this is potentially hugely burdensome on employers if a shorter notice period is agreed and the added complication of a very short notice period. 

We would therefore encourage you to read the consultation and respond outlining your concerns and preferred options.

Please contact us if you would like a more detailed report on the consultation or to discuss your response. The closing date for submissions is 25 August 2026.