Key takeaways

• The Government’s Zero Hours Contracts Reform consultation, officially titled ‘Ending one-sided flexibility: reforms of zero hours and similar contracts’, closed on 25 August 2026. A Government response is expected by mid-November 2026, with reforms likely to take effect during 2027.
• The Association of Recruitment Consultancies (‘ARC’) has submitted a detailed response arguing that agency workers, who already have protections under the Conduct Regulations and the Agency Workers Regulations (AWR), should be treated differently from directly engaged workers.
• ARC’s key asks on guaranteed hours proposals include a 52-week reference period (rather than 12 weeks), recognition of existing guaranteed hours arrangements, and lower administrative and compliance burdens across the agency supply chain.
• ARC’s key ask regarding payment for late notice of shift changes is that the Government clarify what is meant by a “shift” and that notice should be by agreement of the agency and worker, not by an inflexible, non-representative period set by Government.

The consultation on Ending one-sided flexibility: reforms of zero hours and similar contracts closed on 25th August 2026.

Whilst ARC supports measures to protect vulnerable workers at the lower end of the labour market, agency workers do not generally fall into this category. The proposals risk undermining the choice and flexibility that the recruitment sector provides to employers, which in turn contributes to growth and employment opportunities across the UK.

The Chair of ARC, Adrian Marlowe, said:

“It’s incredibly important that the Government gets this right. Having already decided that the proposal designed for direct workers should also apply to agency workers, the Government should recognise and allow for the differences between the two regimes if business is not to be stifled. We hope that the Government listens to the many arguments not only put forward by us and the wider recruitment industry but also by business as a whole. We all want the plan for growth to succeed; any excessive and/or convoluted bureaucracy affecting flexibility may well stifle opportunity for all.”

Key points

Key points addressed in the response include:

• Agency workers should be treated differently from directly engaged workers, reflecting their distinct tripartite relationship and existing legal protections under the Conduct Regulations and AWR.
• Support for longer (52 week) reference periods for agency workers, rather than the Government’s preferred 12 weeks, to distinguish genuinely temporary assignments from permanent requirements.
• Concern that a shorter reference period would force agencies to increase costs to offset the loss of ongoing margins from engagements that extend beyond the reference period, as well as loss predicted of transfer fees.
• Concern that increased agency costs could reduce hirer demand for agency workers, impacting the wider temporary labour supply market and limiting access to flexible employment opportunities, disproportionately impacting groups with protected characteristics.
• Guaranteed hours offers should be based on a sustained and regular pattern of work, based on both consistency of work and hours worked.
• Existing guaranteed hours arrangements should be recognised, including contracts with agencies and umbrella companies.
• Support for agencies having responsibility for guaranteed hours offers where they employ the worker and can guarantee hours across multiple hirers.
• The zero and guaranteed hours contracts reform should protect agency workers existing relationship with their agency and their existing rights, including continuity of employment and protections that could be lost when transferring from agency worker to direct engagement.
• The need to minimise administrative and compliance burdens, particularly where multiple parties are involved, with clear information-sharing requirements.
• Short notice shift provisions should clearly define what a “shift” is, and reflect the agency model, recognising that agencies arrange and confirm work offered by hirers rather than controlling shifts; workers with existing guaranteed hours should be excluded, and compensation for shifts amendments should be recoverable from the hirer.

Next steps

The Government will analyse consultation feedback and publish its response within 12 weeks of the closing date, expected by mid-November 2026. The implementation of the reforms due some point in 2027.

If you would like to have your say and are interested in joining ARC, email info@arc-org.net

---

Frequently asked questions