We study the problem of decentralized secondary frequency regulation in power networks where ancillary services are provided via on-off load-side participation. We initially consider on-off loads that switch when prescribed frequency thresholds are exceeded, together with a large class of passive continuous dynamics for generation and demand. The considered on-off loads are able to assist existing secondary frequency control mechanisms and return to their nominal operation when the power system is restored to its normal operation, a highly desirable feature which minimizes users disruption. We show that system stability is not compromised despite the switching nature of the loads. However, such control policies are prone to chattering, which limits the practicality of these schemes. As a remedy to this problem, we propose a hysteretic on-off policy where loads switch on and off at different frequency thresholds and show that stability guarantees are retained when the same decentralized passivity conditions for continuous generation and demand hold. Several relevant examples are discussed to demonstrate the applicability of the proposed results. Furthermore, we verify our analytic results with numerical investigations on the Northeast Power Coordinating Council (NPCC) 140-bus system.