Zero-hours contracts (2026): Legality, rights, and holiday pay explained

A zero-hours contract gives you flexibility, but leaves you exposed. You have no guaranteed hours, your employer has no obligation to offer shifts. The good news: you have statutory rights. Exclusivity bans (in force since 2015) protect your right to work elsewhere. From 2027, new protections will give you the right to request guaranteed hours and compensation for cancelled shifts. An employment solicitor can clarify what you’re entitled to right now, without waiting for future reforms.

Continue reading to understand your rights and recent legal changes.

Are zero-hours contracts legal in the UK? Current status (2026)

Zero-hours contracts remain lawful under UK employment law. Exclusivity clauses have been prohibited since May 2015 under the Employment Rights Act 1996 (section 27A). Mandatory protections for minimum wage, holiday pay, and statutory sick pay apply to all such arrangements. From April 2026, statutory sick pay eligibility will expand further.

• Exclusivity clauses (preventing work for competitors or other employers) have been unenforceable since 26 May 2015 under the Employment Rights Act 1996, section 27A.
• National Minimum Wage applies to all hours worked at the current statutory rate set by the Department for Work and Pensions.
• Holiday pay entitlement of 5.6 weeks per year (pro-rata) is statutory and cannot be withheld.
• Statutory Sick Pay eligibility will expand from 6 April 2026 when the lower earnings limit is removed.
• From 2027 (date to be confirmed), employers must offer guaranteed hours contracts reflecting regular working patterns (subject to government consultation).

Zero-hours contract worker vs. employee status: How classification affects your rights

Classification as a worker or employee depends on the reality of your working arrangement, not the contract label, and determines eligibility for unfair dismissal claims, statutory redundancy, and maternity pay.

• Workers are entitled to minimum wage, holiday pay, working time protections, and statutory sick pay, but cannot claim unfair dismissal or statutory redundancy unless automatically unfair circumstances apply.
• Employees have contracts of service and can claim unfair dismissal (after 2 years’ service), statutory redundancy, statutory maternity/paternity pay, notice period rights, and whistleblower protection.
• The reality of your working arrangement, including control, personal service, business integration, consistency, and mutual obligation, determines your actual status regardless of contract wording.
• Regular weekly shifts (even if hours vary) under employer control with integration into business operations typically indicates employee status despite zero-hours label.
• Tribunals may reclassify you based on the actual working pattern, overriding the written contract.

Holiday pay for zero-hours contract workers: Calculation and entitlement

Holiday pay entitlement for zero-hours workers is 5.6 weeks of annual leave per year, calculated pro-rata based on hours worked using the statutory reference period for irregular-hours workers, with employers able to discharge this through accrual uplift, separate paid leave, or cash payment.

• Holiday pay is calculated at your normal remuneration (the rate you would receive if working), excluding irregular bonuses.
• Accrual uplift on hourly pay (commonly around 5.6%) is permitted in limited irregular-hours contexts under current regulations; verify your contract clearly states the uplift percentage and that it genuinely equals your statutory entitlement.
• Employers may alternatively allow separate paid time off, pay cash at termination by mutual agreement, or carry unused leave into the next year (subject to restrictions).
• Employers cannot refuse holidays, withhold payment, or claim zero-hours workers “do not qualify”; this exposes them to unlawful deduction claims.
• Claims for unpaid holiday arrears can be brought at an employment tribunal, subject to tribunal limitation rules and statutory back-stop periods.

Statutory sick pay on zero-hours contracts: Eligibility and payment rights

Statutory Sick Pay (SSP) eligibility for zero-hours workers will change significantly from April 2026. Currently, eligibility requires the worker to be classified as an employee and to have done some work for the employer. From April 2026, the lower earnings limit will be removed, making SSP available to all eligible employees regardless of earnings. SSP will also be payable from the first day of illness, instead of the fourth day.

• From April 2026: the lower earnings limit will be removed; SSP will be available to all eligible employees regardless of earnings.
• From April 2026: SSP will be payable from the first day of illness, instead of the fourth day.
• SSP is payable for up to 28 weeks of sickness in any 3-year period at the current statutory rate (subject to annual uprating).

Exclusivity clauses on zero-hours contracts: Legal protections (Since 2015)

Exclusivity clauses, contractual terms or informal practices preventing you from working for competitors or other employers, have been prohibited since May 2015 under section 27A of the Employment Rights Act 1996, with employers unable to penalise workers for secondary employment.

• Written exclusivity clauses in zero-hours contracts are void and unenforceable; any clause preventing work elsewhere can be safely ignored.
• Informal exclusivity practices are also covered: demanding workers declare other employment, threatening to reduce shifts if they work elsewhere, or delaying work offers as penalty for secondary employment.
• Employers can still address genuine conflicts of interest (e.g., working for a direct competitor), protect confidential information, and manage health and safety risks (e.g., fatigue from excessive hours).
• Reducing shifts, removing workers from rotas, or treating workers less favourably because they work elsewhere violates section 27A of the Employment Rights Act 1996.
• If prevented from working elsewhere, you can claim unlawful detriment at a tribunal under section 45A without having to prove unfair dismissal, a lower legal threshold.

Notice periods and termination of zero-hours contracts

Zero-hours contracts rarely include a specified notice period, with the law implying a reasonable notice period based on industry custom and work patterns, typically ranging from one shift for casual work to 1–2 weeks for regular arrangements.

• In the absence of express contractual terms, the law implies a reasonable notice period based on the frequency and regularity of work.
• For very casual work, implied notice may be as short as one shift; for regular arrangements, 1–2 weeks is typical.
• If your employer terminates in retaliation for asserting a statutory right (requesting holiday pay, refusing an exclusivity clause, or reporting a health and safety concern), this is unlawful detriment under section 45A of the Employment Rights Act 1996.

When a zero-hours contract can be challenged: Legal grounds and remedies

Zero-hours contracts may be voided, reformed, or rendered unenforceable when the written terms do not reflect reality, exclusivity restrictions are enforced, statutory rights are breached, or the worker is treated adversely for asserting legal protections.

• Sham contract: If you work the same hours every week despite the contract stating zero guaranteed hours, a tribunal may disregard the written terms and classify you as an employee with minimum contractual hours.
• Exclusivity enforcement: Any exclusivity clause or informal practice preventing secondary employment violates section 27A of the Employment Rights Act 1996; you can claim unlawful detriment and compensation for loss of shifts.
• Minimum wage breach: If you are not paid the applicable minimum wage (currently set by the Department for Work and Pensions, subject to annual uprating) for hours worked, you can claim the shortfall as an unlawful deduction from wages.
• Detriment for asserting rights: If your employer terminates, reduces shifts, or treats you adversely for requesting holiday pay or refusing exclusivity, you can claim unlawful detriment with compensation assessed as just and equitable.
• Misclassification: If you are wrongly classified as self-employed or casual but work under conditions of control and business integration, you can claim reclassification and back-pay for statutory protections.

FAQs

What is a zero-hours contract in 2026?

A legal arrangement where neither party guarantees hours; work is allocated ad-hoc with no minimum weekly commitment.

Do I get holiday pay on a zero-hours contract?

Yes. You’re entitled to 5.6 weeks annual leave (pro-rata). Employers can discharge this through separate paid leave, hourly uplift, or cash payment at termination.

Are zero-hours contracts legal in the UK?

Yes. Exclusivity clauses have been banned since May 2015 (section 27A, Employment Rights Act 1996); employers cannot restrict your secondary employment.

Do you get sick pay on a zero-hours contract?

You may qualify for SSP if classified as an employee. From April 2026, SSP eligibility expands when the lower earnings limit is removed.

Zero-hours contracts are lawful but subject to strict statutory protections covering minimum wage, holiday entitlement, exclusivity bans, and statutory sick pay. From 2027, workers will gain additional rights to request guaranteed hours and compensation for cancelled shifts, subject to government consultation.

This article provides general legal information only and does not constitute legal advice specific to your circumstances; consult a qualified employment solicitor for advice on your situation.

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KEY TAKEAWAYS:

• You have statutory rights to minimum wage, holiday pay (5.6 weeks pro-rata), and statutory sick pay. Exclusivity clauses have been banned since May 2015.
• Classification as a worker or employee, based on the reality of your work, not the contract label, determines unfair dismissal claims, statutory redundancy, and maternity pay eligibility.
• If your employer withdraws shifts, refuses holiday pay, or enforces exclusivity because you assert a statutory right, you can claim unlawful detriment under section 45A of the Employment Rights Act 1996.