Zero Hour Contract Template Reviewed and Updated Including Alternate Clauses for Rolled Up Holiday Pay

What is a Zero Hour Contract?

In simple terms, a zero hour contract is an agreement where an employer does not guarantee a worker a minimum number of working hours. Supporters of zero hour contracts take the view that they provide flexibility for employers and workers, while critics say that they create insecurity and unpredictable incomes. Zero hours contracts are particularly popular in industries where staffing demands fluctuate, like health and social care, retail, leisure and hospitality and logistics.

What are zero hour workers entitled to?

At present, workers on zero hour contracts are entitled to rights including the National Minimum Wage, paid holiday, rest breaks and protection from discrimination. Employers cannot impose exclusivity clauses on workers on zero hour contracts, preventing them from working for another employer.

What will the Employment Rights Act mean for zero hours contracts?

Under the Employment Rights Act 2025, the government is seeking to introduce significant reforms aimed at reducing the “one-sided flexibility” of zero hours contracts. Under the legislation, zero hours contacts will not be banned but new rights will be introduced in respect of:

· A right to guaranteed hours

· Reasonable notice of shifts

· Compensation for cancelled or altered shifts and

· Protection from detriment and dismissal.

Consultation on implementing zero hours reforms is currently underway and will run until August 2026.

Reforms to zero hour contracts are expected to come into force during 2027 as part of a phased implementation programme. Simply-Docs will keep employers advised about these changes.

Fully reviewed and updated Zero Hour Contract template.

In the meantime, the Simply-Docs zero hour contract, which reflects the law as it currently stands, has been extensively revised. In particular, the contract now includes alternate clauses depending on whether:

· Holiday pay is paid at the time the leave is taken or

· Rolled up holiday pay is used.