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The Employment Rights Act 2025 received Royal Assent on 18 December 2025, but its biggest impact is being felt across 2026 and 2027. This is why many employers, HR teams and people managers are now searching for the Employment Rights Act 2026.
The Act changes several areas of UK employment law, including statutory sick pay, paternity leave, unpaid parental leave, unfair dismissal, zero hours contracts, trade unions, sexual harassment, holiday pay, collective redundancy, flexible working and workplace enforcement.
This guide explains the key employment law changes, when they apply, and what employers should review now.
The Employment Rights Act 2025 sits at the centre of the Government’s wider Make Work Pay agenda. It began as the Employment Rights Bill before becoming law.
Its purpose is to strengthen employment rights, improve job security, modernise enforcement and update the industrial relations framework.
For employers, the changes affect:
These reforms are not limited to large employers. Small businesses, charities, public sector organisations, private sector employers and organisations using agency workers or umbrella companies will all need to review their approach.
The changes are being introduced in stages, so employers need a clear roadmap.
| Date | Main changes |
|---|---|
| 18 December 2025 | Employment Rights Act 2025 became law; minimum service levels rules for strikes removed |
| 18 February 2026 | Dismissal for taking part in protected industrial action became automatically unfair |
| 6 April 2026 | SSP from day one, Lower Earnings Limit removed, day-one paternity leave, day-one unpaid parental leave, higher protective award and voluntary gender pay gap action plans |
| 7 April 2026 | Fair Work Agency established |
| August 2026 | Electronic and workplace balloting for statutory trade union ballots, where agreed |
| October 2026 | Harassment duties, trade union measures, tipping rules, public sector outsourcing changes and adult social care negotiating body |
| No earlier than October 2026 | Employment tribunal time limits extended for most employment tribunal claims |
| 1 January 2027 | Six-month unfair dismissal qualifying period, compensatory award cap removed and fire and rehire protections |
| Later 2027 | Guaranteed hours, reasonable notice, short-notice payments, flexible working changes, NDA restrictions, bereavement leave, pregnancy protections and mandatory equality action plans |
Some details still depend on further regulations and Government guidance. HR teams should continue checking Acas and GOV.UK updates as each phase approaches.
Several major changes are already in force. These should now be reflected in HR policies, payroll systems, manager guidance and employment contracts.
From 6 April 2026, statutory sick pay (SSP) is paid from the first day of sickness absence. The three-day waiting period has been removed.
The Lower Earnings Limit has also been removed, meaning more workers are now eligible for statutory sick pay SSP.
Employers should review:
This is one of the most practical employment law changes for HR, payroll and line managers.
From 6 April 2026, paternity leave and ordinary unpaid parental leave became day-one rights.
This means employees no longer need long service before becoming eligible for these leave rights. The notice period for paternity leave has also been temporarily reduced.
Employers should update:
The right to take paternity leave is now available from day one, but statutory paternity pay still has its own eligibility rules.
Eligible fathers and partners can take up to 52 weeks of unpaid bereaved partner’s paternity leave if the mother or primary adopter dies within the first year of the child’s life.
This is a sensitive right, so managers should know when to refer employees to HR and how to support employees with compassion and care.
From 6 April 2026, the maximum protective award for failure to consult properly in a collective redundancy process increased from 90 days’ pay to 180 days’ pay.
This collective redundancy protective award creates a higher financial risk for employers who fail to consult correctly.
Employers should review:
The maximum protective award can become costly quickly where many employees are affected.
From 6 April 2026, employers must keep records of annual leave and holiday pay for at least six years.
This is important because the Fair Work Agency has enforcement responsibilities in areas such as holiday pay.
Employers should make sure HR systems, payroll records and absence data are accurate, complete and easy to access.
From 6 April 2026, sexual harassment became a qualifying protected disclosure under whistleblowing law.
This means workers who report sexual harassment can receive protection from detriment and unfair dismissal.
Employers should review:
Employees must feel able to report sexual harassment without fear of retaliation.
From 6 April 2026, employers can voluntarily publish action plans on gender pay gap issues and support for employees experiencing menopause.
From 2027, equality action plans will become mandatory for employers with 250 or more workers.
These action plans should explain practical steps to improve gender equality, support employees experiencing menopause and reduce pay gap issues over time.
The Fair Work Agency was established on 7 April 2026.
It brings together enforcement activity and will cover areas such as:
The Fair Work Agency is designed to strengthen enforcement of employment rights and help businesses understand their obligations.
Employers should expect more focus on records, pay, contracts, holiday pay and worker protections.
Trade union laws are changing across several phases
The Strikes (Minimum Service Levels) Act 2023 has been repealed. This means minimum service levels rules for strikes have been removed.
From 18 February 2026, dismissal for taking part in protected industrial action became automatically unfair. This removed the previous 12-week limit for claiming unfair dismissal in this context.
Employers should be careful when dealing with trade union members who are involved in protected industrial action.
From 18 February 2026, several trade union rules changed. These included simplified industrial action notices, changes to ballot notices and changes to political fund rules.
From August 2026, trade union members will be able to vote electronically or in person in statutory trade union ballots, where the employer and trade union agree.
Employers should monitor changes to trade union measures, ballot rules and trade union recognition processes.
Trade union recognition processes were simplified from 6 April 2026.
From October 2026, further trade union measures will include:
The Central Arbitration Committee will continue to play a role in trade union recognition disputes.
HR teams should prepare managers to engage constructively with trade union officials, trade union representatives and trade union equality representatives.
October 2026 brings another major phase of UK employment law reform.
From October 2026, employers will face stronger duties to prevent sexual harassment and other forms of workplace harassment.
The changes include:
This means employers cannot rely on policies alone.
Practical steps include:
The 2027 rules will give further detail on reasonable steps to prevent sexual harassment.
Employment tribunal time limits are expected to increase to six months for most employment tribunal claims no earlier than October 2026.
Breach of contract claims are expected to remain at three months.
This will give employees more time to bring claims, so employers should improve:
Better record-keeping will become even more important.
Tipping law will change in October 2026.
Employers will need to:
This is especially relevant for hospitality, leisure, retail and customer-facing employers.
New measures on public sector outsourcing are expected in October 2026.
These are intended to avoid two-tier workforces where ex-public sector employees and private sector employees working on outsourced contracts have substantially different terms.
Employers involved in outsourcing should review procurement, contracts and workforce planning.
A new Adult Social Care Negotiating Body is expected in October 2026.
This is part of the wider move towards stronger collective bargaining and fair pay arrangements in adult social care.
Employers in this sector should monitor further details and prepare for possible changes to pay, consultation and workforce planning.
Unfair dismissal rights will change from 1 January 2027.
From 1 January 2027, employees will be able to claim unfair dismissal after six months of employment.
Currently, most employees need two years of service before they can claim ordinary unfair dismissal.
This change applies to dismissals taking effect on or after 1 January 2027. It means employees hired in 2026 may gain unfair dismissal protections once they reach six months’ service.
Employers should review:
Probation reviews should be structured, timely and properly documented.
From 1 January 2027, the limit on the compensatory award for unfair dismissal will be removed.
This could increase financial exposure where employees can prove significant loss.
Employers should focus on fair processes, clear reasons, proper evidence and reasonable decision-making.
From 1 January 2027, dismissing an employee and rehiring them on worse terms will be automatically unfair in most cases.
This is often called fire and rehire.
The reforms target unfair practices where employers use dismissal to impose worse employment contracts. There may be limited exceptions where the employer can show serious financial difficulties and no reasonable alternative.
Employers should review any plans involving changes to:
Further guidance and updated codes are expected.
Further collective redundancy reforms are expected in 2027.
Employers will need to consider redundancies across the whole organisation, rather than only individual workplaces, when assessing whether collective consultation obligations apply.
This will make workforce planning and consultation more important, especially for employers with multiple sites.
Zero hours contracts are not being banned, but they are being significantly reformed.
In 2027, workers on zero hours and low hours contracts will gain stronger protections.
Workers on zero hours and low hours contracts will have the right to guaranteed working hours if they want them.
This is expected to apply where workers have worked regular hours over a reference period.
Employers will need to monitor working patterns and offer a guaranteed hours contract where required.
Employers will need to provide reasonable notice of shifts and changes to shifts.
This will affect sectors such as:
Managers responsible for scheduling should be trained before the new duties take effect.
Workers will have the right to be paid if a shift is cancelled, moved to another date or cut short at short notice.
Employers should review:
Reasonable notice, short-notice payments and guaranteed hours will make rota planning more formal and more important.
The reforms are expected to affect agency workers and umbrella companies.
Umbrella companies will come under closer regulation when they are brought within the legal definition of employment business.
Employers using agency workers, employment agencies or umbrella companies should review:
This is especially important where labour supply chains are complex.
Flexible working is already a day-one right to request. Further changes are expected in 2027.
If an employer refuses a flexible working request for a genuine business reason, they will need to:
This means employers need better decision-making and documentation.
Employers should review:
Flexible working requests should be handled consistently and fairly.
In 2027, changes to non-disclosure agreements will void clauses that prevent workers from alleging or disclosing work-related harassment or discrimination.
NDAs are not being banned entirely. However, they must not be used to silence workers who want to report sexual harassment, discrimination or wrongdoing.
Employers should review:
Non-disclosure agreements should be clear, lawful and used carefully.
Several family-related protections are expected in 2027.
The Employment Rights Act 2025 will strengthen dismissal protections for pregnant workers and those returning from maternity leave.
Employers should review redundancy, restructuring and performance processes to make sure pregnant workers, employees on maternity leave and returning parents are treated lawfully and fairly.
A new right to statutory bereavement leave will be introduced in 2027.
Further details are expected, but employers should start reviewing compassionate leave policies, manager guidance and support for employees experiencing bereavement.
Gender pay gap reporting already applies to larger employers.
From 2027, mandatory equality action plans will apply to employers with 250 or more workers. These will cover gender pay gap action plans and support for employees experiencing menopause.
Employers should prepare by reviewing:
Disability pay gap reporting and ethnicity pay gap reporting are also expected under separate equality reforms, although further details and timings are still developing.
The Employment Rights Act 2025 affects almost every part of employment practice. Employers should take a phased approach.
Map the key dates across:
Assign an owner for each change and set policy review deadlines.
Review:
Line managers will be central to compliance.
Training should cover:
Managers need to know when to act and when to involve HR.
Better documentation will reduce risk.
Review how you record:
Accurate records can help if employment tribunal claims arise.
Employers using zero hours workers, low hours workers, agency workers or umbrella companies should review:
This should be done before 2027.
Employers should take reasonable steps now and prepare for the duty to take all reasonable steps.
Practical actions include:
Employers should not wait until a complaint or claim is made before taking action.
Employers should inform workers about their employment rights in clear language.
This may include communication on:
Clear communication helps reduce confusion and build trust.l
We support HR professionals, line managers and employers through flexible online training.
Our human resources courses and CIPD courses can help learners build knowledge in employment law, employee relations, people management, HR processes and organisational practice.
Relevant routes include:
For employers, structured HR and people management training can help build confidence across HR teams and line managers as the legal framework changes.
The Employment Rights Act 2025 is one of the most significant updates to UK employment law in recent years. Although many people search for the Employment Rights Act 2026, the official Act became law in December 2025 and is being implemented across 2026 and 2027.
The safest approach is to prepare early. Review your contracts, update HR policies, strengthen manager training, improve record-keeping and communicate clearly with workers.
For HR teams, this is a major compliance challenge, but also an opportunity to improve workplace culture, employee trust and people management practice.
Explore our human resources courses and CIPD courses to support your team through the next phase of UK employment law change.
Is it the Employment Rights Act 2025 or Employment Rights Act 2026?
The official legislation is the Employment Rights Act 2025. However, many people refer to it as the Employment Rights Act 2026 because many of the main changes started in April 2026 or will continue through 2026.
What changed in April 2026?
April 2026 changes include statutory sick pay from day one, removal of the Lower Earnings Limit, day-one paternity leave, day-one unpaid parental leave, bereaved partner’s paternity leave, stronger whistleblowing protection for sexual harassment, a higher collective redundancy protective award, holiday pay record-keeping and voluntary gender pay gap and menopause action plans.
The Fair Work Agency was established on 7 April 2026.
When do unfair dismissal rights change?
Unfair dismissal rights change from 1 January 2027.
Employees will be able to claim ordinary unfair dismissal after six months of employment, rather than the current two-year qualifying period. The cap on compensatory awards will also be removed.
Are zero hours contracts being banned?
No. Zero hours contracts are not being banned.
However, in 2027, zero hours and low hours workers will gain new rights, including the right to guaranteed hours, reasonable notice of shifts and payments for short-notice cancellations or changes.
What are the new harassment duties?
From October 2026, employers will need to take all reasonable steps to prevent sexual harassment. Employers will also be liable for third party harassment unless they have taken all reasonable steps to prevent it.
Further detail on reasonable steps to prevent sexual harassment is expected in 2027.
What is the Fair Work Agency?
The Fair Work Agency is a new enforcement body established in April 2026.
It brings together enforcement activity and will cover areas such as statutory sick pay, holiday pay, National Minimum Wage, agency work rules and, later, umbrella company regulation.
What should employers do now?
Employers should review contracts, staff handbooks, HR systems, payroll, sickness policies, family leave policies, harassment procedures, redundancy processes, flexible working policies, zero hours arrangements, trade union procedures and NDA templates.
They should also train line managers and improve record-keeping.
How can we help with employment law changes?
We offer flexible online HR, CIPD and people management training that can help HR teams and line managers understand employment law changes, improve employee relations practice and prepare for new workplace responsibilities.
Explore our human resources courses or compare our online CIPD courses to find the right training route.
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