Zero hours crackdown could cost firms up to £2.9bn a year
Summary
The UK government plans to tighten rules on zero hours contracts, making employers offer guaranteed hours after a certain amount of work. This change could cost businesses up to £2.9 billion a year, especially in hospitality and retail, according to government analysis.Key Facts
- The proposed reforms would require employers to offer guaranteed hours after employees work a set number of hours each week.
- The cost to employers could range from £350 million to £2.9 billion annually, depending on the final rules.
- Most of the highest costs come from compensation businesses must pay when they cancel shifts.
- The government is considering setting the threshold between 8 and 20 hours per week.
- Hospitality and retail sectors would be the most affected due to their high use of zero hours contracts.
- Business groups warn that the increased costs and administrative work could reduce flexibility and harm hiring.
- The Trades Union Congress supports the reforms to provide workers with more stable and predictable hours.
- Retailers may need to spend hundreds of millions updating payroll systems to comply with the changes.
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