New Duties For Employers Under The Employment Rights Act
In December 2025 the Employment Rights Act became law. This Act contains wide-ranging and fundamental employment law reforms originally promised by the Labour government within 100 days of taking office. This legislation, though long in coming with some of the elements being watered down, nevertheless heralds the most significant increase in working rights for a generation.
As these changes widen employers duties and responsibilities, they will present a challenge to many employers, but these changes will come in gradually over the next two years.
Changes relating to Trade Union activity have already become law as the minimum service level rule for strikes has been removed. And from 18 February 2026, dismissal for taking part in industrial action will become ‘automatically unfair’, as well as other changes relating to Trade Union activity.
Many of the significant changes the Act introduces will come into force in April 2026.
- Whistleblowers making a sexual harassment disclosure will be protected from detriment and unfair dismissal as sexual harassment becomes a ‘qualifying disclosure’.
- Paternity Leave and Ordinary Parental Leave will become ‘day one rights’, alongside the removal of the restriction for taking Paternity Leave after Shared Parental Leave.
- Statutory Sick Pay (SSP) will be paid from the first day of illness, and the lower earnings limit that relates to SSP will be removed.
- The maximum ‘protective award’ for failure to consult on collective redundancies will double to 180 days’ pay.
- The Fair Work Agency will be established in April 2026, with the intention of bringing together existing bodies to enforce employment rights such as holiday pay and statutory sick pay.
- Trade Union recognition will be simplified, electronic voting for Trade Union members will be introduced, and the 50% turnout requirement for industrial action ballots will be removed.
Employers will also need to create action plans around menopause at work and gender pay gaps – voluntary at first, but mandatory in 2027.
Key changes that employers should be aware of in advance of October 2026 are that ‘fire and rehire’ will be classed as an automatic unfair dismissal in most cases, whilst the time limit for making a claim to the Employment Tribunal will increase from 3 to 6 months for all claims.
Regarding harassment in the workplace, employers will be liable for harassment from third parties, unless they have taken reasonable steps to prevent it happening. The duties for employers to prevent sexual harassment will be firmed up, with the law calling for them to take “all reasonable steps” to prevent sexual harassment taking place. The precise nature of what constitutes ‘reasonable steps’ will be specified in advance of this change and are likely to follow the 8 steps proposed by the Equalities and Human Rights Commission which are already enshrined in the Worker Protection (Amendment of Equality Act 2010) Act.
The most important changes in January 2027 are the right to bring an unfair dismissal claim after six months in employment rather than having to work for two years before acquiring this right. Those who already have six months’ service will be immediately protected.
There will also be greater protections for pregnant workers and those returning from maternity leave, and a new right to statutory bereavement leave will be introduced.
Workers on zero-hours contracts will have the right to guaranteed working hours if they want them, whilst workers will have the right to compensation for cancelled or rescheduled shifts.
Employers who reject flexible working requests due to the needs of the business will be required to explain why they believe their refusal is reasonable. Meanwhile, collective redundancy rules will apply to an entire organisation, rather than individual workplaces.
These changes will require employers and HR to update their employment law knowledge to stay compliant within UK law.
We welcome greater protection afforded to anyone who has more than six months’ service to bring claims of unfair dismissal, i.e. in line with a typical 6 month probation period. Employers will need to learn that they should use the first six months of their worker’s employment to iron out any problems using supportive Performance Improvement Plans and initiating difficult conversations about conduct. If there are still conduct or performance issues, fair procedures can be used to dismiss employees before their probation period is completed. In the long run this is fairer and better for both the employer and the employee particularly where the worker is in the wrong job.
Currently, unfair dismissal claims for employees with less than two years’ service are shaped to include less favourable treatment due to a protected characteristic such as sex, race or disability because this is the only way to have any legal redress. Consequently our Employment Tribunals are overloaded with many discrimination hearings lasting three or more days. Many of these workers have less than two years service. These would probably have been settled had the employee had jurisdiction to bring an unfair dismissal claim.
As a firm, we have long sought to improve family-friendly rights and to stamp out discrimination, running several yearly campaigns and providing free advice and training, including our Mind the Bump campaign to stamp out Pregnancy and Maternity discrimination. Our #MeToo Matters campaign, which we ran this January, focused on further protection against sexual harassment that this Act introduces.
This year our Disability Matters campaign will concentrate on the huge amount of women who leave employment due to adverse Menopausal Symptoms or who are struggling to convince their employer that they have a duty to consider making reasonable adjustments to support them. We therefore welcome employers having to provide actions plans around menopause at work and the gender pay gap.
The Employment Rights Act provides positive changes that will make a real difference in the workplace. Increased protection from harassment and unfair dismissal benefits both employees, workers and employers and will increase workplace morale and staff retention.
For expert advice on the Employment Rights Act, contact our Employment Law Team on 01273 609911, or email info@ms-solicitors.co.uk.
