The Employment Rights Act 2025 has started to change how flexible working arrangements operate in practice, and one of the earliest changes took effect on 6 January 2026.
For organisations that rely on casual, seasonal or variable-hours labour, the shift is significant. It affects not only contracts, but everyday decisions about rotas, availability and how work is allocated.
The impact is felt most sharply in smaller organisations, where workforce planning, people management and operational delivery often sit with the same individuals. When legal rules change in this space, the risk is not usually a poorly drafted clause. It is a decision made quickly to keep the business running that later looks problematic in hindsight.
What changed and when
Two linked changes came into force on 6 January 2026 under the Employment Rights Act 2025 and its first commencement regulations.
The Workers (Predictable Terms and Conditions) Act 2023 was repealed. That legislation had introduced a right to request predictable working patterns, and some businesses had begun to plan for it. With its repeal, any processes or documents built specifically around that framework no longer have a statutory basis and should be reviewed or removed to avoid confusion.
More importantly, the legal restriction on exclusivity was widened. The ban no longer applies only to zero-hours contracts. It now applies to all zero-hours arrangements, regardless of how they are described or documented.
The law has moved away from labels and towards reality. What matters is how work is offered and managed day to day.
What counts as a zero-hours arrangement in practice
A zero-hours arrangement exists where there is no guarantee of work and hours are offered as and when needed. There may or may not be a single written contract. In many smaller businesses, the arrangement evolves informally over time.
This can include casual staff brought in during busy periods, bank workers used to cover absence, seasonal workers, hospitality and retail staff working variable shifts, or individuals who are contacted when demand spikes.
If there is an expectation of availability without a commitment to provide work, the arrangement may fall within scope. Avoiding the phrase “zero-hours” in documentation does not change that.
Why this change matters for day-to-day management
Before January 2026, many organisations relied on informal exclusivity to make flexible work viable. People were expected, implicitly or explicitly, to prioritise one business, even though hours were not guaranteed. That approach is now high risk.
The restriction on exclusivity means individuals working under zero-hours arrangements should be free to take other work. The risk for organisations lies not only in written terms, but in how work is allocated once a second job is known about.
Reduced shifts, delayed offers of work or being quietly dropped from rotas because availability has changed can all attract challenge. These outcomes often arise from practical pressures rather than bad intent, but the legal exposure is the same.
Where problems usually arise in smaller organisations
In larger organisations, HR teams and systems can act as buffers. In smaller organisations, the same person may be setting rotas in the morning, dealing with customer demand at lunchtime and handling a staffing issue in the afternoon.
That reality increases risk.
Decisions about who gets work are often made quickly and informally. If someone declines shifts because they are working elsewhere, it can feel natural to prioritise someone more available. Over time, that can look like penalising secondary work, even if the intention was simply to keep operations running smoothly.
Without clear criteria or records, it becomes difficult to show that decisions were based on business need rather than exclusivity pressure.
What the changes mean for flexibility and control
Zero-hours working has not been banned. What has changed is the balance between flexibility and control.
Organisations can still decide when work is available and who is suitable for it. What they cannot do is use access to work as leverage to restrict what someone does outside the business where hours are not guaranteed.
This requires a shift in mindset. Flexibility now needs to be mutual rather than one-sided. Where availability is important, that expectation needs to be managed transparently rather than enforced indirectly.
What can still be managed lawfully
The changes do not remove all safeguards.
Conflicts of interest can still be managed. It is reasonable to require disclosure where someone works for a competitor or where there is a risk to confidential information.
Health and safety considerations also remain relevant. Fatigue, working time limits and fitness to work can all be addressed where there is a genuine risk.
Performance expectations still apply when work is accepted. If someone regularly cancels at short notice or fails to meet standards, that can be addressed on its own merits. The key distinction is that these controls should not be used to discourage outside work in principle.
Practical steps to reduce risk
A practical starting point is to list everyone who works variable or ad hoc hours and to review how work is offered to them. This includes looking beyond contracts to emails, texts, rota tools and informal practices.
Any wording that suggests priority, exclusivity or permission to work elsewhere should be reviewed carefully. Replacing blanket restrictions with narrower conflict and safety provisions reduces risk without removing necessary protections.
Consistency matters. Where different people manage rotas, agreed criteria help avoid accusations of unfair treatment. Even brief notes explaining why shifts were allocated in a particular way can be valuable if decisions are later questioned.
The wider business impact
For many smaller organisations, the biggest impact will be cultural rather than legal. The change challenges the assumption that flexible workers can be treated as permanently on call without guaranteed income.
Handled well, this can support retention. Individuals who feel free to balance work across roles are often more willing to stay engaged and responsive when work is available.
Handled badly, it can lead to disputes, complaints and loss of trust, often at moments when the business can least afford distraction.
Planning ahead rather than reacting later
The January 2026 change is one of several early Employment Rights Act reforms. It sets a direction of travel towards earlier and broader worker protections.
Organisations that take time now to review how flexibility operates in practice will be better placed as further changes come into force. Those that rely on informal pressure or assumptions about loyalty may find that approach increasingly difficult to sustain.
The aim is not to add bureaucracy, but to align working practices with the legal reality.
Practical takeaway
Zero-hours working remains lawful, but it now operates within tighter boundaries. The greatest risks arise not from legal drafting, but from everyday decisions made under pressure.
Clear expectations, fair processes and a willingness to adapt working models reduce the likelihood of problems later. For organisations where flexibility is essential, investing a little time now can prevent far greater disruption down the line.
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services Limited - a Marketing & Content Agency for the Professional Services Sector.
