Comparison Β· 2026/27
Zero-Hours Contract vs Agency Worker Rights
Zero-hours contracts and agency work are both forms of flexible engagement, but they sit under different pieces of UK employment law. A zero-hours worker is engaged directly with no guaranteed hours; an agency worker is supplied by a recruitment business to a hirer and gains extra protection β pay parity after 12 weeks β under the Agency Workers Regulations 2010. This guide compares pay, holiday, notice, sick pay and dismissal protection for each.
At a Glance
| Feature | Zero-Hours Contract | Agency Worker |
|---|---|---|
| Employer for pay | Direct employer/business | Recruitment agency |
| Guaranteed hours | None | None (per assignment) |
| Pay parity with permanent staff | Not automatic | After 12 weeks (AWR 2010) |
| Exclusivity clauses | Banned since 2015 | Contractual with agency |
| Day-one rights | Standard worker rights | Facilities + vacancy info |
| Holiday pay | 12.07% accrual method | Via agency, pro rata |
| SSP eligibility | Yes, if LEL met | Yes, via agency |
How Zero-Hours Contracts Work
A zero-hours contract engages the individual directly with a business, with no obligation on the employer to offer work and no obligation on the worker to accept it when offered. Most zero-hours staff are legally "workers" rather than full "employees", which gives them core protections β National Minimum Wage, paid holiday, rest breaks, protection from discrimination β but not the full set of employee-only rights such as statutory redundancy pay, which typically require continuous employee status.
Since May 2015, exclusivity clauses that prevent a zero-hours worker from working for another employer are unenforceable, and since 2015 detrimental treatment for working elsewhere is also unlawful. Continuity of employment can still build up over gaps in work provided the gaps are not treated as a genuine break under the Employment Rights Act 1996 "week that counts" rules β an important factor for accruing the two years\' service needed for unfair dismissal protection.
How Agency Worker Rights Work
Agency workers are supplied by an employment business (the agency) to a hirer for a temporary assignment. The Agency Workers Regulations 2010 give day-one rights to access the hirer\'s collective facilities and information about internal vacancies, and β once the worker has completed 12 continuous calendar weeks in the same role with the same hirer β the right to the same basic pay and core working conditions as a comparable direct employee.
The 12-week clock keeps running through short breaks such as annual leave, sickness or a factory shutdown, but restarts if the assignment genuinely ends and a materially different role begins. Some agencies use a Swedish Derogation-style contract to guarantee pay between assignments in exchange for opting out of the 12-week pay-parity right β this practice was abolished from April 2020, so all agency workers are now entitled to the 12-week comparator right regardless of contract type.
Holiday and Sick Pay Compared
Both groups accrue 5.6 weeks of statutory annual leave pro rata to hours worked, using the 12.07% accrual method reinstated for irregular-hours workers from 1 January 2024. For zero-hours workers this is usually calculated and paid by the direct employer; for agency workers, the agency typically calculates and pays holiday pay, sometimes rolled up into an enhanced hourly rate β a practice that is only lawful for irregular-hours and part-year workers under the 2024 rules, not for workers with regular hours.
Statutory Sick Pay of Β£123.25 a week (2026/27) is available to both groups provided average weekly earnings meet the Lower Earnings Limit of Β£129, calculated over the 8 weeks before the illness began. Volatile hours make this calculation more unpredictable for zero-hours workers, and agency workers can lose continuity β and therefore SSP eligibility β if there is a gap of more than a few weeks between assignments through the same or a different agency.