Employment Rights Act 2025 – Where Are We Now and What Employers Should Expect Next 

The Employment Rights Act 2025 (“ERA 2025”), which received Royal Assent on 18 December 2025, introduced major changes to employment law provisions.

For a detailed overview of the reforms introduced when the Act first came into force, see our earlier blog on the Employment Rights Act 2025 and what employers need to know.

As these Employment Rights Act 2025 changes begin to take effect, employers are now navigating a phased implementation timetable. Some provisions are already in force, whilst others, including significant reforms affecting dismissal rights, redundancy and workplace protections, will be introduced over the next 12 to 18 months.

This article provides an update on where things currently stand (as at the end of May 2026), including which key changes are already in force, which reforms are still to be implemented, and recent and ongoing government consultations.

Why this matters for employers

The Employment Rights Act 2025 introduces some of the most significant employment law changes in recent years. For employers, this creates a moving compliance landscape, requiring updates to policies and practices now, whilst also preparing for more fundamental changes that will affect how you manage recruitment, dismissal and workforce restructuring.

In practice, this means balancing immediate compliance obligations, such as day-one employment rights and statutory sick pay changes in the UK, with longer-term planning for increased tribunal risk and reduced contractual flexibility.

Employment Rights Act 2025 – key changes already in force

The changes already in force will affect several core areas of employment law. In particular, employers should be aware of updates relating to trade unions, family leave rights and statutory protections.

Immediately upon the ERA 2025 receiving Royal Assent, the Strikes (Minimum Service Levels) Act 2023 was repealed.

As of 18 February 2026:

• Further trade union reforms were introduced, which included the repeal of the majority of the Trade Union Act 2016, removal of the 10-year ballot requirement for trade union political funds and the simplification of industrial action notices and industrial action ballot notices;
• A new category of automatic unfair dismissal was introduced, this being dismissal for taking part in industrial action; and
• Employees that are newly eligible for ‘Day 1’ Paternity Leave and Unpaid Parental Leave are able to give notice that they intend to take leave.

As of 6 April 2026:

• The maximum period collective redundancy protective award was doubled to 180 days;
• Paternity leave and ordinary or unpaid parental leave became a day-1 right, meaning that eligible employees can give notice of leave on the day their employment begins;
• The restrictions on taking paternity leave after shared parental leave was removed;
• “Sexual harassment” was introduced as a new category of qualifying disclosure, meaning that workers that ‘blow the whistle’ on sexual harassment are protected from being subjected to detriment and unfair dismissal because of said disclosure;
• Where either the mother or primary adopter dies within the first year of the child’s life, the bereaved father or partner of the deceased mother is permitted to take up to 52 weeks of paternity leave;
• Statutory Sick Pay became payable from day-1 of the sickness absence and the Lower Earnings Limit requirement was removed;
• Employers must keep records of annual leave and holiday pay for a minimum of 6 years;
• Employers can voluntarily publish action plans relating to menopause and on gender pay gaps. For employers with more than 250 workers, this will become a mandatory requirement in 2027 (although the exact date is yet to be determined); and
• The process for trade union recognition within the workplace was simplified.

In practice, these changes increase administrative requirements and introduce new risks, particularly where policies and internal processes have not yet been updated to reflect day-one rights and expanded record-keeping obligations.

Upcoming employment law changes employers need to prepare for (2026 to 2027)

Looking ahead, a number of more wide-ranging reforms are expected to come into force between late 2026 and 2027. These changes are likely to have a more fundamental impact on how employers manage their workforce.

Dismissal and tribunal risk

• No earlier than October 2026, the time limits for making a claim to an employment tribunal will increase from 3 months to 6 months for all claims.
• On 1 January 2027, the qualifying period for bringing an unfair dismissal claim will be reduced from 2 years to 6 months.
• The compensatory cap for unfair dismissal awards is due to be removed.

These unfair dismissal changes in 2027 are likely to increase both the volume and value of employment tribunal claims, particularly for newer employees. In practice, employers will need to assess dismissal risk much earlier in the employment relationship.

Workplace protections and harassment

• From October 2026, employers will be liable for all types of harassment from third parties, unless they can demonstrate that they have taken all reasonable steps to prevent it from happening.
• Employers will also be required to take “all reasonable steps” to prevent sexual harassment.
• Protections against dismissal for pregnant workers and those returning from employment leave will be strengthened.
• In 2027, clauses that prevent workers from alleging or disclosing work-related harassment or discrimination will become invalid.

This will require employers to take a more proactive approach to preventing harassment, including reviewing training, policies and reporting mechanisms.

Trade unions and industrial action

• From August 2026, electronic or workplace ballot voting for industrial action, union elections and other statutory ballots will be introduced.
• In October 2026, further changes to trade union rules will be implemented, including a new duty for employers to inform workers of their right to join a trade union, a new right to time off for union equality representatives to carry out their duties and an updated Code of Practice for trade union recognition.
• From October 2026, workers taking part in industrial action will be protected against being subjected to a detriment.

These changes are likely to increase trade union activity and require employers to take a more structured and compliant approach to engagement with unions and industrial relations processes.

Contractual change and workforce management

• On 1 January 2027, fire and re-hire protections will be strengthened by making it automatically unfair, in most cases, to fire and re-hire an employee on less favourable terms.
• The right to guaranteed hours for zero and low hours workers will be introduced in 2027.
• Changes to collective redundancy requirements will be introduced in 2027. This includes the requirement for an employer will need to consider the total number of redundancies across their whole organisation, not just the individual workplace affected.

Employers may find that contractual flexibility is reduced, particularly when responding to changing business needs.

Flexible working and family-related rights

• Unfair statutory bereavement leave will be introduced in 2027.
• In 2027, it will become a legal requirement for employers who reject flexible working requests because of a genuine business reason to state the reason(s) from the eight acceptable reasons and to also explain why they consider the rejection to be reasonable;

Employers should expect greater scrutiny of decision-making in these areas and ensure that processes are clearly documented and consistently applied

Government consultations on employment law reforms

Alongside these legislative changes, a number of government consultations are ongoing, which will further shape how the reforms are implemented in practice, including:

• Non-disclosure agreements (NDAs) in harassment cases
• Trade union right of access (draft code of practice)
• Flexible working processes
• Zero-hour contracts/guaranteed hours provisions
• Collective redundancy thresholds (organisation wide triggers)

We are also awaiting the outcome of recently closed consultations, including those relating to fire and rehire, protection from detriment for industrial action and trade union recognition and e-balloting rules.

What should employers do now?

For employers, the key challenge is managing compliance today while preparing for a moving target, as the final shape of several core obligations is still being determined.

In light of the above implemented and upcoming Employment Rights Act 2025 changes, employers should take proactive steps now to manage risk and ensure compliance.

As a matter of priority, employers should consider the following:

• Update policies to reflect the changes to statutory sick pay, the new one-day family leave rights, and industrial relation reforms, as outdated policies may increase the risk of non-compliance or employee claims
• Audit the use of zero-hour and low-hour contracts and contract variation practices, to reflect the changes to fire and rehire practices, and identify where existing arrangements may become non-compliant; and
• Review and update contract of employment and contract for services to reflect the changes being introduced in respect of probationary periods, statutory sick pay and family leave, ensuring documentation remains fit for purpose
• Ensure that HR teams and managers are aware of upcoming employment law changes and understand how these may affect day-to-day decision-making, particularly in relation to dismissal, redundancy and flexible working requests.

Taking these steps now can help reduce the risk of disputes, minimise disruption and ensure your organisation is better prepared as further reforms come into force.

As these changes continue to unfold, seeking early advice where needed can help you respond confidently. If you would like support in preparing for these changes, taking advice at an early stage can also help you avoid more complex issues arising later.

This content is provided for general informational purposes only and does not constitute legal advice. It is not intended to address the circumstances of any individual or entity, nor should it be relied upon as a substitute for specific advice from a qualified solicitor. The information reflects the legal position as at the date specified and may be subject to change. If you require advice on a specific matter, please contact us directly.