What is the latest on the Workers (Predictable Terms and Conditions) Act 2023?

The Workers (Predictable Terms and Conditions) Act 2023 was due to come into effect this year.  Despite it receiving Royal Assent last year and being an enhancement of employee rights, the Labour Government has decided to shelve this piece of legislation.

Instead, the Labour Government is proposing to create a new, separate right for employees in favour of a new right to have a contract that provides more job security and predictability of hours.  This is part of Labour’s plans to ban ‘exploitative’ zero hours contracts and end one-sided flexibility.

A press release given by the previous Government gave us an insight into what we could have expected from the 2023 Act, stating “The Predictable Working Act introduces a right for workers to request a more predictable working pattern, intending to redress the imbalance of power between some employers and workers in atypical work, encouraging workers to begin conversations with their employers about their working patterns”.

The previous Government even went as far to consult ACAS, who published a consultation code of practice on handling requests for a predictable working pattern.  However, the Labour Government has decided to create its own new laws in this area and did not want to confuse workers and employers with two different models.

The Labour Government plans to legislate in this area to ban ‘exploitative’ zero-hours contracts and ensure that all jobs provide a baseline level of security and predictability.  The latter to be achieved by ensuring workers have the right to a contract that reflects the number of hours they regularly work.

It is still not clear when a zero hours contract will be considered ‘exploitative’.  Some employers consider them essential to the structure of their workforce, to deal with unexpected peaks in the need for workers.  Some unions regard any use of zero hours contracts as exploitative.

It is important to note that the previous Government proposed a right to request a more predictable contract.  Labour is proposing a right to have a more predictable contract.  Such a contract would be based on a workers’ hours regularly worked in a 12-week reference period.

When will these changes be introduced?  The Government’s background briefing note promised the Employment Rights Bill would be “introduced within the first one hundred days…and represents the biggest upgrade to workers’ rights in a generation”.  Therefore, if the Government is true to its word, we should see an introduction of the Bill in early to mid-October 2024, however, it could be months before it receives Royal Assent, and ACAS would likely need time to publish their guidance around the Bill.

To prepare for these changes, employers should review their workforce and the use of zero hours contracts and similar contracts.  Employers must consider the business need for such arrangements and how this can be met when these changes take effect.  As well as considering what alternative arrangements could be implemented that would still give employers the flexibility that zero hours contracts provide.

If you require advice and assistance with zero hours contracts, please contact a member of our team.

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