The Rule That’s Not Just About Zero Hours — And Why Every Temp Desk Should Be Worried

The UK temporary staffing market is worth £59.1 billion and employs around 1.49 million workers (Staffing Industry Analysts). Almost all of it is now in scope for a piece of incoming legislation that most recruitment agency owners haven’t fully read — and many haven’t heard of at all. On RecTalk, Nitin Sharma sat down with Adrian Marlowe and Theresa Mimnagh from Lawspeed to explain why the Government’s current consultation on guaranteed hours isn’t a niche zero-hours issue. It’s a fundamental challenge to the way temporary staffing works in the UK — and in Adrian’s words, it could be “more of a tsunami” than the Agency Workers Regulations ever were.

This post is for information only and does not constitute legal advice. Speak to a qualified specialist in recruitment law for guidance on your specific situation.

The Name Is Misleading. The Scope Is Not.

The consultation is officially titled “Ending one-sided flexibility: reforms of zero hours and similar contracts.” That title is doing a lot of work to make this sound narrower than it is. In reality, as Lawspeed has pointed out, the proposals are written to cover all hirers of any kind of temporary or agency worker, regardless of the contract type in use — not just businesses running zero-hours arrangements (Lawspeed).

If you supply temporary workers to clients, this affects you. If your clients hire agency workers for any purpose, this affects them — and by extension, you. The consultation launched on 2 June 2026, closes on 25 August 2026, and full implementation is targeted for 2027. That timeline is not as comfortable as it sounds.

What the Proposals Actually Require

The core requirement is this: after a reference period — which the Government has indicated it prefers to be as short as 12 weeks — hirers would be required to offer agency workers a direct contract with guaranteed hours reflecting the actual hours they’ve been working. The principle behind it is to end “one-sided flexibility,” where workers must be available to work but hirers have no obligation to provide hours or pay when work isn’t available.

The argument is reasonable in theory. The problem is the unintended consequences it creates in practice — particularly for the recruitment agencies and hirers who supply and use temporary workers for entirely legitimate, genuinely flexible purposes. The Government’s own agency work survey from 2021 found that 74% of agency workers are happy with their current arrangements. The legislation, as currently proposed, would bring all of them into scope anyway — leaving it to the industry to make the case for exclusion.

The Anti-Avoidance Trap Nobody’s Talking About

The guaranteed hours obligation is serious. But Adrian Marlowe identifies an even more significant risk in the anti-avoidance provisions that are buried deeper in the proposals — and which have received far less attention.

Here’s the logic: if hirers face an obligation to offer direct contracts after 12 weeks, the obvious response is to terminate assignments before the 12-week threshold is reached. The Government anticipated this. To prevent it, the consultation proposes that if a hirer ends an assignment, a worker could bring a claim — potentially in the employment tribunal — arguing that the termination was motivated by avoidance of the guaranteed hours obligation.

The implication is stark: any termination of a temporary assignment could potentially trigger an employment tribunal claim, with the tribunal left to determine whether the termination was reasonable or was in fact avoidance. As Lawspeed puts it, this is “guaranteed to not encourage growth in the supply industry, or in business generally.” Hirers who currently use agencies specifically because temporary workers have few direct claims against them would face a fundamentally different risk landscape.

The Commercial Consequences for Recruitment Agencies

For agencies running temporary and contract desks, the implications flow in multiple directions. Transfer fees are at risk: if a hirer is required to offer a direct contract after 12 weeks, the mechanism that protects agency revenue from conversion of temp-to-perm placements becomes complicated. Pricing structures built around the current model of agency supply may need to be rethought. Clients who use agency workers specifically because they want flexibility — and the ability to adjust their workforce without the obligations that come with direct employment — may reduce their use of temp workers altogether. That’s less business, not more.

The knock-on effects would hit small and medium-sized hirers hardest. Large enterprises have compliance teams. SMEs typically rely on the agency to handle the complexity. If the complexity increases significantly — and if the liability landscape shifts — some employers will simply stop using temporary workers. That’s bad for the agencies that supply them. It’s also bad for the agency workers who depend on temp work as a genuine, preferred way to work.

Why This Is Bigger Than AWR

The Agency Workers Regulations, which came into force in 2011, required that agency workers receive equal treatment on basic working and employment conditions after 12 weeks in a role. The industry adapted. It was disruptive and expensive, but manageable. The guaranteed hours proposals represent a different order of challenge — because the anti-avoidance provisions effectively make the legal environment around assignment termination unpredictable, and unpredictable legal environments make businesses cautious. Adrian Marlowe’s assessment is that the industry is facing “more of a tsunami” than anything AWR produced.

The consultation window is the opportunity to change that. The regulations that will govern implementation in 2027 are being shaped right now, based on the responses the Government receives before 25 August. This is not a done deal. It is a live conversation — and the recruitment industry’s voice in that conversation matters enormously.

Real Talk

The consultation has a deliberately understated name. Don’t let it understated your attention. If you run any kind of temporary staffing business — or if your clients do — this is the most significant piece of employment legislation to affect your commercial model in over a decade. Read it. Respond to it. And do both before 25 August.

This post is inspired by the RecTalk episode with Adrian Marlowe and Theresa Mimnagh from Lawspeed: The Biggest Threat to Recruitment Since AWR? Watch the full conversation on YouTube. Read Lawspeed’s detailed analysis at lawspeed.com.

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