7. Duty to offer guaranteed hours

7.1. Employers will be required to offer an eligible worker a minimum hours contract, which will be based on the previous working patterns of the worker, known as the “reference period”.  This offer has to be made after the end of each ‘reference period’ for the duration of any qualifying contract.  This right will apply to workers who either

7.1.1. Work under a zero hours contract or “arrangement” or

7.1.2. Work under a contract for a low number (to be determined) of minimum guaranteed hours but work more than those hours in the reference period (see below).

7.2. Employers will have to offer workers guaranteed hours, and the hours must reflect the pattern of days and times of working hours within the reference period. The reference period itself will be set by secondary legislation but as the government’s current guidance states it is expected to be 12 weeks.

7.3. To qualify, a worker does not need to have been employed without a break through the reference period and can have more than one contract during the reference period.

7.4. Workers are free to reject an offer of guaranteed hours and remain on a zero hours contract if they want to do so and remain engaged on their current terms.  If the worker accepts the guaranteed hours contract then it appears that the guaranteed hours will commence the next day. The worker has a ‘response period’ in which to reply to agree or otherwise, which begins with the day after the day on which the offer is made, and ends with the specified day which will be set out in regulations.

7.5. Agency workers are often employed on zero hours contracts.  The Act requires hirer to offer guaranteed hours but allows for other intermediaries to have similar obligation in certain circumstances. However, the definition of “excluded worker” will be provided in subsequent regulations.

7.6. Whilst employers will be required to offer the minimum hours contract, and to give workers information on their rights, workers will have a right to refuse and will have the opportunity to remain on their current arrangement if they prefer.

7.7. The are no express exceptions to the legislation for seasonal workers, despite concerns being raised during the Act’s passage through parliament. However, some definitions will be specified in regulations yet to be made.

7.8. Employers are not able to use the opportunity to change any other terms of the contract, the Act explicitly prevents this.

7.9. It will be automatically unfair to dismiss an employee if the reason is related to guaranteed hours e.g. the employee accepted or reject a guaranteed hours offer, believed that they were entitled to such an offer or brought related proceedings.

7.10. The government intends to consult on the measures, and is to set out further details in regulations. Timescales are uncertain, and there are a good number of questions still outstanding, such as the definition of “low hours”, what the response times are, the exceptions to the rule and what the compensation would be at tribunal.

Considerations for employers

7.10. If all employees qualifying for a guaranteed minimum hours contract accept the offer, the employer could find themselves overstaffed at periods of low demand.

7.11. Failure to comply with the new requirements could result in the employee making a claim to the Employment Tribunal.

7.12. For our HR Protect clients, we recommend you contact your usual adviser for guidance on managing contracts where there are fluctuating work levels.