Shocking to believe but we are already past the halfway mark of 2025. Just like the months, changes to the employment law landscape have also been coming at employers thick and fast.
Labour introduced the Employment Rights Bill (ERB) last year and it is expected to be passed sometime in Autumn this year. Whether employers like it or not (with many employers being in the latter camp), these changes are going to be a huge shake up in the employment sphere.
Fortunately for employers with their fingers off the pulse, Labour has published a roadmap of its implementation of the ERB. We set out below what changes employers should get ready for now (both inside and outside the ERB), changes they should start thinking about and changes that they should continue to monitor but don’t need any immediate action.
It is worth noting that the timeframes are indicative only and subject to change. It is also worth remembering that the devil is in the detail, and the accompanying regulations will spell out how many of these proposed reforms will work in practice.
Changes that need actioning now
- Update employment contracts and policy to include Neonatal Care Leave (NCL): The new right to NCL took effect from 6 April 2025 and provides employees with the right to paid leave if they or their partner have a baby that needs neonatal care. While the regulations outline the specific requirements; broadly, an employee can take up to a maximum of 12 weeks’ NCL from the first day of their employment and is entitled to either £187.18 a week or 90% of their average weekly earnings (gross), whichever is lower.
- Ensure your workplaces are in line following the UK Supreme Court judgment in For Women Scotland v The Scottish Ministers: The Court ruled that in the Equality Act 2010, ‘sex’ means biological sex and where somebody identifies as trans, they do not change sex for the purposes of the Act, even if they have a Gender Recognition Certificate. This has significant implications, among other things, for bathrooms and changing facilities. The ERHC has published an interim update on the practical implications of the UK Supreme Court judgment has on employers here.
- Engage with your payroll providers to ensure they are ready for the changes to leave entitlements when they take effect in April 2026: The ERB will remove the lower earnings limit and waiting period for employees receiving Statutory Sick Pay – and introduces day one rights for Paternity Leave and Unpaid Parental Leave.
- Get familiar with the new trade union rules and industrial action rules if applicable: Many of the measures involving trade unions and industrial action will take effect shortly following Royal Assent of the ERB. This includes repealing most of the Trade Union Act 2016 and the Strikes (Minimum Services Levels) Act 2023 (such as simplifying industrial action notices and industrial action ballot notices) and introducing protections against dismissal for taking industrial action.
Changes that employers should start to consider
- How you can ensure your sexual harassment policies and training are up to date: From October 2026, employers will be required to take ‘all reasonable steps’ to prevent sexual harassment of their employees and will have a new obligation to not permit the harassment of their employees by third parties. Undertaking a thorough risk assessment, as well as developing a prevention of sexual harassment policy takes time and effort. Employers will also need a runway to implement the policy and provide training for employees (and managers) on the new rules. This is not an obligation an employer should put off until the last minute.
- Be ready for the extension to time limits for tribunal claims: The timeframe to implement the extension to time limits for tribunal claims is now scheduled for October 2026. Most significantly, discrimination and unfair dismissal claims will now have a six-month time limit rather than three months. We expect that this will result in an increased number of claims, especially for larger employers. It is worth taking the time now to embed good internal systems and processes (such as documenting decision-making and processes) and highlighting problem areas within the business to reduce the impact of increased claims will have on the business.
- Understand the Fair Work Agency’s role and powers to enforce employment rights: The Fair Work Agency which is planned to be established in April 2026 will bring together existing state enforcement functions, and eventually, will take on enforcement of a wide range of employment rights. This includes having powers to investigate and take action against businesses for possible breaches of employment law rights.
Changes that employers should monitor but don’t need immediate action
Unsurprisingly, some of the largest changes to the employment law landscape have been scheduled to come into effect at the end of 2026 and 2027 giving employers some (perhaps much needed) temporary relief and allowing the Government further time to consult with the relevant stakeholders.
These changes include:
- The implementation of day one unfair dismissal rights: Introduction of day one unfair dismissal rights as well as the new statutory probationary period and ‘lighter touch’ dismissal process will not be introduced until 2027. As significant development is that the House of Lords voted to remove the initial period entirely, instead, amending the ERB to simply reduce the qualifying period for unfair dismissal from two years to six months. The House of Commons will vote on the new bill which we suspect will probably reject the Lords’ amendment, using the Labour super majority to restore the original position.
- Collective consultation and ‘fire and re-hire’ reform: Changes to the law on ‘fire and rehire’ are coming in 2026, and the threshold for collective consultation will take effect sometime in 2027. “Fire and re-hire” will be an automatic unfair dismissal, except where a business is in serious financial trouble affecting its continuation and the employer cannot reasonably avoid the need to make the change. The ERB removes the wording “at one establishment” when calculating thresholds and adds a new threshold test which will be defined in regulations.
- Zero hour contracts reform: Ending the exploitative use of zero hours contracts and applying the new zero hour contract measures to agency workers will also be coming in 2027.
- Expanding family friendly worker rights: These include bereavement leave, expanded rights for pregnant workers and flexible working. These are scheduled for 2027.
Overwhelmed? Don’t worry, here at the Brecher Employment Law team we can advise you about how the above changes may impact your business and what steps you can take now to make sure you are ready for these changes.
This update is for general purpose and guidance only and does not constitute legal advice. Specific legal advice should be taken before acting on any of the topics covered. No part of this update may be used, reproduced, stored or transmitted in any form, or by any means without the prior permission of Brecher LLP.
