Changes to the Employment Rights Act 2025
Employment Rights Act 2025
The Employment Rights Act 2025 will introduce a number of important changes at the start of April 2026. Further reforms will be phased in gradually.
Barrister, Roger Davies the Managing Director of P4B Law Limited looks at some of the forthcoming changes and offers practical advice.
April 2026
Paternity leave and parental leave will be available from day one, instead of after a qualifying period.
Statutory Sick Pay (SSP) reforms from 6th April 2026 will mean that SSP is payable from day one of absence, rather than after the current three waiting days. There will no longer be a minimum earnings level to qualify for SSP. Employers are recommended to introduce robust absence management policies and procedures to effectively manage absence levels.
A government body, the Fair Work Agency, will be set up to enforce key employment rights including holiday pay and sickness pay. The Agency has the power to bring claims on behalf of employees and to take enforcement action in respect of tribunal awards.
Trade Union recognition rules will change. Notably, the membership threshold for unions to secure statutory trade union recognition will be significantly reduced.
The protective award in collective redundancy claims will double.
Sexual harassment disclosures will count as whistleblowing.
October 2026
Trade Unions’ access to workplace rights will increase, meaning that unions will have the right to access workplaces physically, and to communicate with workers in person and digitally. This will cover representation and organising for new members.
‘All reasonable steps’ must be taken to prevent sexual harassment, not just the current ‘reasonable steps’. Employers need as a minimum to undertake risk assessments and provide training to all staff, particularly managers.
Liability for third party harassment will be introduced.
Employment Tribunal time limits will increase. Meaning that in most instances employees will have 6 months to bring a claim, rather than the current three months.
There will be enhanced protections for trade union activity
Tipping laws will be made more precise with policies needing to be reviewed every three years.
There will be a duty for employers to inform workers of their right to join a trade union, probably as a statement in the contract of employment.
January 2027
Strict limits will be introduced on the ability to ‘fire and rehire’ employees. This will severely curtail an employer’s right to unilaterally vary employment contracts. Employers are strongly advised to review their employment contracts in preparation. A right to vary clause is essential and in-built flexibility for future changes should also be considered.
Employees will be able to bring an unfair dismissal at 6 months’ service (instead of the current 24 months). Employers are recommended to introduce robust probationary review policies.
There will be a removal of the cap on unfair dismissal compensation. Currently, compensation is either 52 weeks’ gross salary or a statutory cap (currently set at £123,543), whichever is lower.
Later in 2027
More redundancy situations will require collective consultation.
Workers who regularly work greater hours than those set out in their contracts will be entitled to guaranteed hours and shift scheduling. Compensation will be payable where shifts are changed or cancelled at short notice.
There will be flexible working request changes. Flexible working is likely to become the default by requiring employers to reasonably explain refusals for day-one requests, expanding employee consultation, and increasing the frequency of flexible working requests allowed.
Mandatory gender pay gap and menopause action plans for larger employers will be introduced.
Enhanced protection for those who return to work after maternity leave will be created.
All employees will get least one week off unpaid for the death of a relative or dependant, available from their first day of work.
It is not hard to see why these have been described as the biggest changes in employment law for a generation. Employers need to update their policies and procedures to ensure that they meet the minimum legal criteria and review employment contracts to ensure that they are fit for purpose with regards to the forthcoming changes. Stricter absence management policies and probationary review policies will be required to meet and manage the new changes.
