GOVERNMENT reforms designed to guarantee hours for workers could threaten decent jobs, four trade bodies have warned.
As part of the Employment Rights Act, workers on zero or low-hour contracts will get the right to guaranteed working hours, if they want them.
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The new measures could threaten jobs trade bodies have warned Credit: Alamy
The act was given Royal Assent last December and the measures are being phased in slowly over two years.
But the British Retail Consortium, Food and Drink Federation, Recruitment and Employment Confederation, and UK Hospitality have warned in a letter to the Government that the measures could lead to poorer opportunities and conditions for workers.
Meanwhile, they suggested changes to the policy they believe would avoid “the double whammy of increasing unemployment and fewer young people entering the labour market”.
The letter said: “Across our sectors, concern is deep and growing that the current approach risks stripping flexibility from the labour market at precisely the wrong moment.
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“With demand already weakened, poorly designed guaranteed hours measures could become a tipping point, pushing employers to reduce hiring, limit hours or withdraw flexible roles altogether, denying work to those who need it most, or moving to less secure, more casual models of engagement.”
Employers are already facing a raft of pressures, including higher National Insurance contributions, elevated costs due to the war in the Middle East and an increase in the minimum wage.
As a result, tighter margins have forced companies to reduce the number of workers they hire or make employees redundant.
Unemployment was at 4.9% in the three months to February, according to the Office for National Statistics.
The number of workers on the payroll fell by 74,000 in the year to February.
Meanwhile, early estimates of vacancies for January to March 2026 suggest a decrease of 29,000 to 711,000 compared with October to December.
A Government spokesperson said: “We will only achieve a thriving economy once people have a wage they can count on, which is why we’re giving greater certainty to over half the UK’s workforce through our Employment Rights Act.
“We will ensure people can have the security they need by giving eligible workers the right to guaranteed hours, and we will work closely with workers and employers on how the measures are implemented.”
What is the Employment Rights Act?
The Employment Rights Act 2025 contains several rule changes to make it easier for employees to access workplace rights.
It also includes several new laws to make work safer and fairer for employees and agency workers.
Among the key changes are clearer rules around your working hours and your right to be paid if your shift is cancelled.
Stronger protection if you raise concerns to reduce the risk of losing pay or work unfairly.
Better protections for parents and carers to support your right to time off and flexible working.
The rules are being phased in gradually.
New rules around parental leave came into force on April 6.
They include:
Paternity leave is now a day one right. This means you are entitled to paternity leave from your first day on the job.
Ordinary parental leave is also a day one right.
You can now take paternity leave after shared parental leave.
Fathers and partners can now take up to 52 weeks of unpaid leave if the mother or primary adopter dies when your child is under a year old or in the first year of adoption.
Changes to your rights to claim sick pay also started from April 6.
They included:
Claiming sick pay from the first day of your illness.
The lower earnings limit has been lifted so there is no minimum income needed to be able to claim sick pay.
