​Introduction

The Gig Economy, as a term of phrase, traces its roots back to the late “noughties”, generated as a term to describe the rise of workers taking on multiple, short-term jobs or freelance work, but contracting as a career choice is not a new concept.

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MPI has been trading in providing contractors to our clients in a variety of engineering sectors for over 60 years. This flexibility provides an invaluable service to businesses, allowing them to remain agile, yet competitive in an ever-evolving UK labour market. For contractors themselves, it provides a platform to utilise a wide variety of skills, diversify the roles they undertake and, for those who want to, the opportunity to travel!

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However, the proposed Employment Rights Bill, currently progressing through Parliament, threatens to disrupt this balance—posing significant potential challenges for recruitment agencies, clients, and contractors alike. In this blog, we explore some of these challenges, providing insights to consider if you wish to engage with your local MP on the bill.

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The Importance of Contracting and a Flexible Workforce

Contracting plays a vital role in the UK economy, providing businesses with the agility to scale their workforce in response to demand, market fluctuations and for specific projects. The need for this flexibility became particularly evident during the last decade when challenges like Brexit and the pandemic disrupted normal operations.

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Following that disruption the COVID-19 pandemic created further complications for businesses. Lockdowns, significant changes in demand, further supply chain disruptions and varying rule changes for in person contact meant businesses were forced to flex significantly during those months and years. In both cases, having access to a flexible workforce allowed not only a faster response, but also a reduction in the financial pressures of permanent hires.

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For individuals, the pandemic also reshaped attitudes toward work, with many reassessing their priorities and seeking greater flexibility in their careers to give them a better work/life balance. Reduced commuting, autonomy over working hours and locations became deciding factors when choosing the right roles.

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Contracting offers similar freedoms and choices, it allows individuals to take control of their careers, to choose projects that suit their interests and their skill set and to work in a way to suit their lifestyle at the time.

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In a rapidly changing labour market, a flexible workforce benefits both business and workers alike, which in turn ensures the UK remains competitive on a global scale.

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The Employment Rights Bill- A Threat to Flexibility

In April last year the House of Commons had the first reading of the new employment rights bill. The purpose of the bill is to modernise and upgrade the UK's employment rights framework, focusing on strengthening worker protections, tackling poor working conditions, and promoting economic growth by ensuring a more secure and fair workplace for all. However, critics have pointed out that the key points of the bill risk undermining the very flexibility that makes contracting so effective. So what are the key points that are raising concern?

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1.      Banning Zero Hour Contracts- all workers are to be offered guaranteed hours contracts instead, based on the regular hours they have been working. Agencies and clients must be therefore monitoring working patterns for those currently on zero hours contracts to prepare to adjust contracts accordingly.

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2.      Notice for Cancellation of Shifts- whilst the exact notice has not been finalised, the assumption is that the bill will insist on 7 days’ notice for initiating and cancelling shifts or compensation will have to be paid. In many industries this is a complete change of process and will be difficult to accommodate.

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3.      Ban on “Fire and Rehire” Tactics- Agencies and clients that regularly update or reissue short-term contracts must ensure changes aren’t perceived as a downgrade in terms, as this could now breach the new fire-and-rehire rules.

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4.      Day One Rights- The removal of the two year qualifying period for unfair dismissal and redundancy protections could even extend into short term contracts if the desire to end early is instigated meaning clients and agencies will have to be very sure of the minimum length before offering the contract.

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These are the main areas of concern for flexible working, there are other minor impacts but these four remove all elements of adaptability that have traditionally made contracting attractive to both workers and employers. By enforcing rigid structures onto a system built around responsiveness and mutual convenience, the bill risks disincentivising temporary engagements altogether. While the intention to improve job security and fairness is commendable, it's essential that policymakers balance these goals with the operational realities of flexible work. Without that balance, the UK may see a decline in agile staffing solutions, particularly in sectors that rely heavily on short-term contracts to meet fluctuating demands, ultimately impacting productivity, project delivery, and economic resilience.

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Conclusion

As we look to the future of contracting in 2025 and beyond, it’s clear that flexibility remains a cornerstone of a resilient, responsive workforce benefiting both businesses and individuals.

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While the proposed Employment Rights Bill aims to provide greater security for workers, it’s vital that this doesn’t come at the expense of the very adaptability that makes the UK labour market competitive and dynamic.

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At MPI, we’ll continue to advocate for a balanced approach, one that protects worker rights without stifling opportunity, innovation, and efficiency. We encourage all stakeholders, clients, contractors, and fellow recruiters to stay informed, engage with their MPs, and have their say in shaping a fair and functional future for flexible work.