In a major development for workers’ rights, agency workers will now be included in the ban on “exploitative” zero-hour contracts as part of the government’s employment reform bill. This long-overdue change, which The Workers Union has been championing for years, marks a significant step forward in the fight against precarious employment. At last, meaningful legislative progress is being made, and we call that a win.
A Long-Awaited Victory for Workers
For years, The Workers Union has been highlighting the vulnerabilities of zero hour contract agency workers, who often find themselves in a cycle of uncertainty with no guaranteed hours and unpredictable income. The new rules mean that agency workers must now be offered a contract guaranteeing a minimum number of hours per week. This change closes a crucial loophole that has allowed some employers to circumvent fair working practices by using agency staff instead of directly employed workers.
These amendments to the Employment Rights Bill, set to be outlined today Tuesday the 4th of March, ensure that workers who choose to remain on zero-hour contracts will also be eligible for compensation if their shifts are cancelled at short notice. However, the government has yet to clarify what constitutes “short notice.”
With around one million agency workers in the UK—many employed in warehouses, hospitality, and the NHS—this legislative employment law change has the potential to impact a significant portion of the workforce. While unions have largely welcomed the move, business groups such as the Recruitment and Employment Confederation (REC) have voiced concerns, warning that it must not undermine the flexibility that some workers prefer.
Fair Pay and Protection from “Fire and Rehire” Tactics
The amendments to the Employment Rights Bill extend beyond agency workers’ contracts. The government is also set to double the penalty for employers engaging in ‘fire and rehire’ practices, a controversial tactic where businesses dismiss employees and rehire them on worse terms. Under the new rules, companies that fail to properly consult workers before implementing such changes could be required to pay up to 180 days’ worth of wages in compensation—double the current 90-day penalty.
Furthermore, statutory sick pay protections will be expanded, ensuring that workers earning under £123 per week will receive sick pay from the first day of illness. This group will be entitled to 80% of their average weekly earnings or statutory sick pay (currently set at £116.75 per week), whichever is lower. Currently, statutory sick pay is only available after three consecutive days of illness.
Concerns from Business Groups
While worker advocacy groups are celebrating these changes, business leaders remain sceptical about the real-world impact of the amendments. Craig Beaumont, Executive Director of the Federation of Small Businesses, expressed disappointment, arguing that there remains a “huge gulf between the stated aims of this bill and the real-world negative impact on jobs and growth.” Small business leaders worry that these regulations may impose additional costs and administrative burdens, potentially discouraging job creation.
The Recruitment and Employment Confederation has also cautioned against unintended consequences, stating that agency or gig workers value the flexibility their roles provide and warning against any legislation that may erode these choices.
The Workers Union Says…
“For too long, agency workers have been left vulnerable to exploitative employment conditions. The Workers Union has consistently campaigned for stronger protections, and we are pleased to see progress finally being made. While business groups raise concerns about flexibility, we firmly believe that job security and fair treatment should never be sacrificed in the name of convenience. This is a landmark moment in the fight against insecure employment, and we will continue to monitor the implementation of these changes to ensure they deliver meaningful improvements for workers across the UK. After years of raising awareness and pushing for reform, we call this a win for workers.”
