Consultation response to UK Government Employment Rights Act: Make Work Pay: ending one-sided flexibility – reforms of zero hours and similar

SCVO welcomes the opportunity to respond to questions 1, 2 ,4 and 33 of the UK Government consultation on reforms relating to zero hours and similar contracts to implement measures in the Employment Rights Act 2025.

Q1.a:  For directly engaged workers, which of the following options should the hours threshold be.

16 hours per week.

Q1.b: Please explain your answer.

Across the UK, the voluntary sector is a significant employer, employing over 1 million people, including 136,000 people in Scotland - 5% of Scotland’s workforce. The  sector delivers vital public services – like social care and youth work, as well as a host of other essential services that people and communities across Scotland, and the rest of the UK, rely on.

Fair Work for the voluntary sector workforce should be a priority. Our workforce makes a huge contribution across Scotland and the UK, offering a lifeline to people, families, and communities as the ongoing cost-of-living crisis bites. This lifeline shouldn’t need to be extended to voluntary sector staff.

Fair Work for voluntary sector employees is a priority for the Scottish Council for Voluntary organisations (SCVO), many voluntary sector employers, and, increasingly, voluntary sector funders in Scotland. SCVO welcomes the new rights for employees and workers that the Employment Rights Act introduces, including the right to claim unfair dismissal from day one of employment, the right to guaranteed hours, the introduction of a statutory probation period, sick pay from day one and earlier access to parental rights, all measures that support Fair Work.

With these new rights, however, comes new responsibilities which voluntary sector employers must be supported and resourced to understand and implement.

Job security- including guaranteed hours or Living Hours - is an essential element of Fair Work. In the voluntary sector, like in other sectors, zero hours or sessional contracts are often used for legitimate reasons, for example, to provide cover for permanent staff or to cover busy periods.

The Living Wage Foundation and Living Wage Scotland define Living Hours as a guaranteed minimum of 16 hours a week unless the worker requests otherwise SCVO supports this definition. Similarly, the Foundation and Living Wage Scotland state that contracts should accurately reflects hours worked.

While SCVO supports Fair Work and the right to guaranteed hours, which the Act introduces, these changes are most likely to present a challenge to voluntary organisations without access to HR and employment law support. These organisations are less likely to be aware of the new requirement or to have the administrative resources to carry out the review of hours, which depending on the outcome of this consultation, could be required as often as every 12-weekly.

Plans to progress towards Fair Work and employment rights should also recognise that poor funding practice creates precarity that undermines both job security in the voluntary sector and the ability of voluntary sector employers to support their staff. Specifically, short-term grants or contracts, delays in decision-making, and poor communication actively undermines job security, creating uncertainty for both employers and their staff.

In the voluntary sector, 6,500 organisations in Scotland employ staff. Of these, the majority, over 4,800, employ nine staff or less. How these small, and indeed, larger voluntary sector employers will be supported to understand the new responsibilities and requirements and implement the changes brought by the Employment Rights Act is unclear, with no recognition of the additional challenge for small voluntary sector employers, with little or no access to HR support.

Similarly, it is unclear how the Act will complement the existing programme of Fair Work initiatives led by the Scottish Government, which voluntary sector employers in Scotland have been incorporating into their HR practices since 2021.

While SCVO welcomes the increase to both the National Living Wage and National Minimum Wage - Fair Work for the voluntary sector workforce, including at least the Real Living Wage, is an SCVO priority- the Employment Rights Act also does not recognise the need to support and resource voluntary organisations with these increases or support their wider Fair Work ambitions.

Q1.c:   Which option(s) (including any not outlined above) do you think could have an impact on the number of contracted hours in job offers?

SCVO believes in the principles of Fair Work and in the UK Government’s ambitions to progress workers’ rights, but it must be recognised that the voluntary sector faces barriers to implementation and that poor funding and procurement practices undermine aspirations to offer secure work. A Fair Funding approach which addresses short-term funding cycles and ingrained operational issues, including delayed decision-making, and poor communication, is central to realising Fair Work and employment rights and offering security to organisations across the voluntary sector, their staff, volunteers, and the communities they work with. The UK Government has recognised the need to support civil society to make an impact. The Scottish Council for Voluntary Organisations (SCVO) welcomes this recognition.  

The right to claim unfair dismissal from day one is a positive change and strengthens the rights of voluntary sector employees and workers. However, these changes will have resource implications and ensuring resources are available to support organisations to meet new legislative requirements, which may present challenges for some voluntary sector employers, is essential. This includes resources associated with performance management dismissals, job descriptions, contract terms, and training for managers on how to support good performance. It will be crucial, therefore, for the UK government to work with the sector to understand these challenges.

To support civil society, our workforce, and the people and communities we work with, Fair Work for Scotland’s voluntary sector workforce should be a priority supported through the Employment Rights Act. To ensure the legislation is successfully implemented the UK government should support voluntary organisations by:

• Recognising the voluntary sector as a significant employer.

• Working with the voluntary sector to understand any challenges.

• Supporting and resourcing the sector to understand and implement the new people processes the Act will introduce.

• Providing detailed statutory guidance, informed by engagement with the voluntary sector, on the implementation of the Act and following secondary legislation.

• Ensuring grants and contracts the UK Government, their agencies, and other public bodies award, support Fair Work and cover the full costs of employing staff, including at least the Real Living Wage, increased NICs costs, inflation-based uplifts and any new costs associated with the revised legislation, at least on a par with those offered to public sector staff.

• Working with the Scottish Government to ensure the UK level Employment Right Act and Scottish Government Fair Work First initiative are complementary and collectively progress Fair Work and employment rights.

Q1.d:   Which option(s) (including any not outlined above) do you think could have an impact on the availability of additional hours for workers?

The UK Government must ensure grants and contracts they, their agencies, and other public bodies award, resource Fair Work and employment rights and cover the full costs of employing staff (including at least the Real Living Wage, increased NICs costs, inflation-based salary and other uplifts, and any new costs associated with the revised legislation, at least on a par with those offered to the public sector). Failure to do so will impact the additional hours available to workers in the charity sector.

SCVO’s recent research shows the amount of public money provided to third sector organisations in Scotland froze between 2021 and 2023, falling by £177 million in real terms – a cut of 5%. While new challenges, such as the UK Government’s recent increase in employers’ National Insurance Contributions (NICs) cost the sector in Scotland alone, at least £78 million each year. The Scottish Third Sector Tracker, also highlights that in Scotland, 97% of voluntary organisations are facing challenges, while recruitment and retention challenges continue across the sector, with thirty-eight percent (38%) of organisations reporting moderate to significant challenges recruiting paid staff. These persistent financial and operational challenges impact job and financial security for staff including the availability of hours.

Similarly, if there is not clear and detailed statutory guidance, informed by engagement with the voluntary sector, on implementing the Act and secondary legislation, this may impact voluntary sector employment. The voluntary sector currently, and for many years, has employed over 1 million people across the UK and comprises 5% of Scotland’s workforce. In Scotland the sector employs more people than both the police and teaching professions in Scotland combined.

Q1.e:  Which option(s) (including any not outlined above) do you think could have an impact on the availability of additional hours for particular groups of workers sharing a protected characteristic under the Equality Act 2010?

The voluntary sector employs more women (64.5%), more part-time workers (37%), and more people with a disability (23%) than the public and private sectors (https://scvo.scot/research/stats-people). Women and people with a disability are at greater risk of living in poverty, an inequality the Poverty Alliance stress deepened during the pandemic.

SCVO’s 2025 Scottish Voluntary Sector Workforce Survey found a quarter of staff in the voluntary sector are employed on fixed-term contracts or more casual arrangements – a rate far higher than in other sectors. The  GCVS Fair Work survey also suggests that mixed ethnicity and other ethnic minority workers were more likely than other groups to report having their working hours fixed by their employer, as a result, they may not get the same flexibility and opportunities to access extra shifts.

Despite performing better than the private sector, 9% of people employed by ‘not for profit’ organisations were paid below the Real Living Wage in 2025 and, as set out in SCVO’s 2025 Scottish Voluntary Sector Workforce Survey, only 39% of paid staff in the sector feel that they are paid fairly, with more than one in five saying their salary does not cover basic needs.

As well as low pay for women, the 2023 GCVS Fair Work survey  found that staff from ethnic minorities and those with disabilities are more likely to report high levels of financial insecurity, and less likely to be able to pay an unexpected bill. The lower hourly pay rates experienced by some women and minorities paired with shorter hours, exacerbates these issues. The UK Government needs to work with local government, funders and, crucially, the voluntary sector, to ensure that guaranteed hours for voluntary sector staff can accommodate at least the Real Living Wage.

Fair Work for the voluntary sector workforce, including at least the Real Living Wage, is an SCVO priority. While SCVO welcomes the increase to both the National Living Wage and National Minimum Wage, the Employment Rights Act does not recognise the need to support and resource voluntary organisations with these increases or support their wider Fair Work ambitions. The UK Government could go further, supporting the Real Living Wage and resourcing and supporting the voluntary sector to pay our essential workforce at least the Real Living Wage to support them through the ongoing cost-of-living crisis and deliver a fair wage for the work that they do.

Despite many improvements in areas such as the Real Living Wage and pay transparency, there is still a substantial gender pay gap in the sector which compares favourably to the private sector while falling behind the public sector. As is the case across sectors, this pay gap appears to be closely interlinked with a large pay gap for part-time workers. As most part-time workers are women, it is not surprising that many women working in the voluntary sector feel they are not fairly paid for the work they do. Research, including the Scottish Voluntary Sector Workforce Survey 2025, shows that women with caring responsibilities are significantly more likely to work part-time. Caring responsibilities impact the ability to work extra hours at short notice or evenings and weekends.

SCVO and many voluntary sector employers support Fair Work and employment rights, but the legislation should recognise that the challenges voluntary sector employers and their staff face are often compounded by funding uncertainty, which respondents consistently describe as the most stressful aspect of their work.

Strengthening the sustainability of the workforce should be a priority for employment rights legislation, but to achieve this more equitable way of working between the voluntary and public sectors, alongside proportionate, community-led commissioning approaches and progress on Fair Funding, is needed.

The UK Government and the Scottish Government will also need to coordinate their plans to ensure that UK Employment Rights legislation and Scottish Government’s Fair Work First initiative are complementary and collectively progress Fair Work and employment rights in a way that is clearly communicated with voluntary sector employers, their staff, and funders.

Q2.a: Agency workers should not be entitled to guaranteed hours offers when (choose one of the two options below):

They already have a contract guaranteeing hours above the threshold (for example, by their agency) regardless of which hirer these hours are to be worked for.

Q2.b: Please explain your answer

The responsibility for providing Fair Work including guaranteed hours should sit with both the agency and the hirer.  However, we believe that the agency should provide their workers with guaranteed minimum hours as they are the employer.

Q4.b: How long should the initial reference period be for directly engaged workers?

As stated earlier in this response, job security - including guaranteed hours or Living Hours - is an essential element of Fair Work. In the voluntary sector, like in other sectors, zero hours or sessional contracts are often used for legitimate reasons, for example, to provide cover for permanent staff or to cover busy periods.

The Living Wage Foundation and Living Wage Scotland define Living Hours as a guaranteed minimum of 16 hours a week unless the worker requests otherwise. SCVO supports this definition. Similarly, the Foundation and Living Wage Scotland state that contracts should accurately reflect hours worked.

While SCVO supports Fair Work and the right to guaranteed hours, which the Act introduces, consideration should be given to the challenge presented to voluntary organisations that do not have access to HR and employment law support. These organisations are less likely to be aware of the new requirement or to have the administrative resources to carry out the review of hours which, depending on the outcome of this consultation, could be required as often as every 12-weekly.

Regardless of the reference period, detailed statutory guidance, informed by engagement with the voluntary sector, will be needed on the implementation of this element of the Act.

Q33: Is there anything else you want to tell us in relation to Part 1 of this consultation, on the right to guaranteed hours?

The UK Government has recognised the need to support civil society to make an impact. The Scottish Council for Voluntary Organisations (SCVO) welcomes this recognition.  

To support civil society, its workforce, and the people and communities it works with, Fair Work and employment rights for the voluntary sector workforce across the UK should be a priority. However, it should be recognised that in Scotland there is a need for the UK Government’s Employment Rights Act and the Scottish Government’s Fair Work First initiative to be complementary to achieve this. This will require joint working between the UK and Scottish Governments.

The voluntary sector is a significant economic actor across the UK, as highlighted elsewhere in this response, the voluntary sector employs over 1 million people, including 136,000 people in Scotland - 5% of Scotland’s workforce. In comparison, more people than both the police and teaching professions in Scotland combined.

Fair Work for the voluntary sector workforce, including at least the Real Living Wage, is an SCVO priority. While SCVO welcomes the increase to both the National Living Wage and National Minimum Wage, the Employment Rights Act does not recognise the need to support and resource voluntary organisations with these increases or support their wider Fair Work ambitions. Similarly, the Government could go further, supporting the Real Living Wage and resourcing and supporting the voluntary sector to pay our essential workforce at least the Real Living Wage to support them through the ongoing cost-of-living crisis.

The voluntary sector workforce makes a huge contribution, providing a diverse range of essential services and support including; childcare, social care, emergency support, support into employment, housing, digital inclusion, and a wide range of advice services. The sector also undertakes vital medical and environmental research, runs most of Scotland’s theatres, museums, galleries, and sports clubs, and campaigns for change on a huge variety of issues.

Annual funding and delays in communications and payments creates an uncertain environment where voluntary organisations must frequently issue redundancy notices, particularly at the end of the financial year, when delayed decision-making from Government and other funders creates further unnecessary uncertainty, impacting on organisations, their staff, volunteers and the communities they work with. 

Fair Work for the Scottish voluntary sector’s workforce, including payment of the real Living Wage, must be a priority, in addition to the UK Government’s plans on guaranteed hours and flexibility, which should closely align with the Living Wage Foundation and Living Wage Scotland’s Living Hours.

The UK Government needs to work with devolved administrations, local government, funders and, crucially, the voluntary sector, to ensure that guaranteed hours can accommodate at least Real Living Wage. To facilitate this, it is essential that the Government:

• Recognises the voluntary sector as a significant employer
• Works with the voluntary sector to understand the challenges
• Supports and resources the sector to understand and implement the new HR processes the Act and secondary legislation will introduce
• Provides detailed statutory guidance, informed by engagement with the voluntary sector, on the implementation of the Act and secondary legislation
• Ensures grants and contracts the UK Government, its agencies, and other public bodies award, support Fair Work and cover the full costs of employing staff, including at least the Real Living Wage, increased NICs costs, inflation-based salary and other uplifts and any new costs associated with the revised legislation, at least on a par with those offered to public sector staff and employers.
• Works with the Scottish Government to ensure the UK Employment Rights Act and subsequent secondary legislation and Scottish Government Fair Work First initiative are complementary and collectively progress Fair Work.

Testimonials

“We want to look after our staff and provide cost of living increases to their wages to ensure they can continue to work for us and aren’t too stressed.” 

Medium voluntary sector organisation.

“Funding issues ensure that no one has security of employment. Sustainability for voluntary sector organisations is fundamental to progressing positive change in our communities and in employment security”. 

Social enterprise.

“Our income from the Scottish Government hasn’t changed over the past five of six years. It means that staff have received no pay rises in that time to meet the changing costs they face.” 

Voluntary sector intermediary.

SCVO did not respond to the remaining questions is this consultation.

About this response

SCVO has drawn on evidence from our research, policy development and engagement with voluntary organisations across Scotland. Throughout this submission we refer to several published evidence sources which the Government may wish to consider alongside our response: 

Fair Funding in Scotland.  

The Scottish Third Sector Tracker.

The Scottish Voluntary Sector Workforce Survey 2025.

Public Sector Funding 2025.

State of the Sector Statistics 2026.

About the voluntary sector in Scotland

The voluntary sector in all its diversity is a powerful force for positive change and a significant part of our economy. From grassroots volunteer-run community groups like village halls and playgroups to major providers of public services in social care and housing, the voluntary sector is present in every aspect of our society and is the glue that holds communities together, with over 46,500 voluntary organisations in Scotland and over 1 million volunteers.

Together these organisations employ over 136,000 paid staff. A quarter of charities employ staff, and the average income of these charities is around £900k. In the voluntary sector, 6,500 organisations in Scotland employ staff. Of these, the majority, over 4,800, employ nine staff or less. Many deliver vital services and work with some of Scotland’s most marginalised communities.