Operators raise concerns over guaranteed hours policy

A spokesperson for Greene King told The Morning Advertiser (MA) flexibility is central to the success of hospitality businesses.

They continued: “It allows operators to adapt to seasonal demand, while acting as a key attraction for new talent.

“For many of our team members, shift patterns allow them to fit jobs around their studies, caring commitments or other employment. The proposed 12-week reference period for guaranteed hours fails to reflect the variability of their work across the year.”

The spokesperson added extending the reference period to at least six months would “ensure contracts reflect the true hours that long-term employees work, while reducing the risk of unnecessary costs for pubs”.

Added pressure

Meanwhile, Star Pubs managing director Lawson Mountstevens told The MA the wider reforms were adding to pressure on licensees already facing rising costs and regulatory burdens.

“The changes brought about by the Employment Rights Act are significant and wide-ranging,” he said.

“We’re supporting our licensees through a challenging period, but ultimately employment decisions are down to the individuals running the business.

“We are navigating a number of complex policy issues at the moment, and we recognise the strain this is putting on our licensees.”

Mountstevens added the sector needed further support from Government, including reforms to business rates, cuts to beer duty and VAT, and “a holistic appraisal of the burden of regulation”.

The concerns come at a time when operators are already dealing with rising employment costs, including increases to national insurance contributions and the national living wage, alongside ongoing inflationary pressures across food, drink and energy.

Substantial threat

The comments follow a joint letter from UKHospitality, the British Retail Consortium, the Food and Drink Federation and the Recruitment and Employment Confederation, which warned the policy could pose a “substantial threat to good jobs”.

The letter stated requiring employers to offer guaranteed hours based on a 12-week reference period risked becoming a “tipping point” in a weakening labour market, potentially leading to fewer roles, reduced hours or a shift away from flexible employment models.

The trade bodies called for the reference period to be extended to at least six months, alongside a minimum threshold of eight hours, to better reflect seasonal demand and avoid unintended consequences.

Separate data from the British Retail Consortium shows 70% of Gen Z workers aged 18 to 29 say flexibility at work is important to them, rising to 73% among those working part time, underlining the potential impact on entry-level roles.

Industry groups have also warned that rising employment costs are already affecting hiring decisions, with more than half of retail finance leaders planning to reduce hours or overtime and nearly a third expecting to freeze recruitment.

For hospitality, which employs more than 3.5 million people and relies heavily on flexible labour, operators say the reforms could significantly reshape recruitment and staffing models.

Previous warnings from the sector have highlighted the wider operational impact of the reforms.

Heath Ball, managing director of independent operator Frisco Pubs, said: “These new employment rights create a field of landmines for operators. Day one rights, for example, will require you to make sure you are really 150% on any new hires. You cannot afford to be relaxed about recruitment.”

The proposed reforms aim to improve security for workers through measures including guaranteed hours, changes to sick pay and tighter rules on contracts.

However, operators warn that without adjustments, the legislation risks increasing complexity in a sector that depends on flexible working patterns.