The Employment Rights Act 2025 represents the most significant overhaul of UK workplace law in decades. Following Royal Assent in December 2025, the reforms are being introduced in phases throughout 2026 and 2027.

The changes aim to:

• Strengthen job security

• Expand access to sick pay and family leave

• Increase protection against harassment and unfair treatment

• Modernise industrial relations

• Improve enforcement of workers’ rights

Whether you’re an employee, employer, HR professional or union representative, understanding what’s changing and when is essential.

Removal Of Minimum Service Levels For Strikes

Previous rules requiring minimum service levels during industrial action were repealed. This marked the first step in reforming industrial relations law under the new framework.

Stronger Protection for Industrial Action

Dismissal for participating in lawful industrial action becomes automatically unfair, removing the previous 12-week limitation period.

What this means:

• Employees taking part in lawful strikes have stronger protection.

• Employers face greater legal risk if dismissals are linked to industrial action.

Simpler Ballots and Notices

• Notice period for industrial action reduces from 14 days to 10 days.

• A simple majority vote in favour is sufficient to mandate action.

• Industrial action mandates extend from 6 months to 12 months.

• Picket supervisor requirements are removed.

Impact: Trade unions may find it easier to organise lawful action, and employers will need to update internal policies accordingly.

Statutory Sick Pay (SSP) From Day One

SSP will now be payable from the first day of sickness absence instead of the fourth (also known as the wait period).

The lower earnings threshold for eligibility is also removed meaning lower-paid and variable-hours workers will qualify.

Impact: More workers gain financial protection when unwell, and employers may see increased short-term SSP costs.

• Paternity leave becomes a day-one right.

• Ordinary unpaid parental leave becomes a day-one right.

• Restrictions on taking paternity leave after shared parental leave are removed.

• Bereaved partner’s paternity leave (up to 52 weeks in specific cases) is introduced.

Impact: Families gain greater flexibility and earlier access to support.

The maximum protective award for failure to consult in collective redundancy situations doubles from 90 days’ pay to 180 days’ pay.

Impact: Non-compliance with redundancy consultation rules become significantly more costly to employers.

Sexual harassment disclosures are explicitly protected under whistleblowing legislation.

Impact: Employees reporting harassment gain additional legal protection.

A new enforcement body, the Fair Work Agency, will consolidate oversight of workplace rights including SSP, holiday pay and redundancy consultation.

Impact: Greater enforcement consistency and potentially more proactive investigations.

Electronic Balloting

Trade unions may use electronic ballots for industrial action where agreed.

Stronger Harassment Protections

Employers will have a legal duty to take all reasonable steps to prevent harassment, including third-party harassment (e.g., by customers or clients).

Impact: Employees have more protection against harassment in the workplace.  

Tribunal Time Limits Extended

Most employment tribunal claims will have a six-month time limit instead of three months.

Impact: Employees have more time to bring claims. Employers face extended exposure to legal action.

Trade Union & Workplace Information Duties

Employers must inform workers of their right to join a union and provide reasonable facilities to union representatives.

Tipping
Tipping law will change in October 2026. Employers will need to consult with workers or their representatives before creating a tipping policy and update their tipping policy every 3 years.

Impact: Employees within the hospitality (and other professions where tipping is common practice) will be protected by regulations that ensure their tips are passed over 100% without deductions. 

From 1 January 2027:

• The qualifying period for unfair dismissal reduces from two years to six months.

• The cap on compensatory awards for unfair dismissal is removed.

• “Fire and rehire” practices become automatically unfair in most circumstances.

Impact: 

• Employees gain protection much earlier in employment.
• Potential compensation awards may significantly increase.
• Employers must ensure fair procedures from the outset of employment.

Zero-Hours & Shift Work Reform

• Right to request guaranteed hours.

• Right to reasonable notice of shifts.

• Compensation for cancelled shifts.

Flexible Working

Employers must provide clear statutory reasons when refusing flexible working requests.

Gender Pay Gap & Menopause Action Plans

Action plans become mandatory (following initial voluntary reporting).

Stronger Redundancy Threshold Rules

Consultation thresholds may apply organisation-wide rather than per location.

Umbrella Company Regulation

Umbrella companies will be formally regulated within employment law enforcement structures.

Taken together, the Employment Rights Act reforms:

• Expand day-one employment protections

• Increase employer compliance duties

• Extend tribunal claim time limits

• Strengthen enforcement mechanisms

• Shift the balance of workplace power toward greater worker protection

For employees, this means earlier access to rights and greater security.

For employers, it means policies, contracts, handbooks and HR training will need reviewing well before 2027.

When does the Employment Rights Act 2025 come into force?

The Act received Royal Assent in December 2025. Key reforms are phased between February 2026 and January 2027, with further changes during 2027.

Will unfair dismissal become a day-one right?

No. The qualifying period reduces from two years to six months (from January 2027).

Is Statutory Sick Pay changing?

Yes. From April 2026, SSP will be payable from day one of sickness absence, and more workers will qualify.

What happens to fire and rehire?

From January 2027, dismissing and rehiring employees on worse terms will generally be automatically unfair.

Are zero-hours contracts being banned?

Not entirely, but workers will gain rights to guaranteed hours, reasonable notice of shifts, and compensation for cancellations.

If you are unsure how these changes affect you:

• Acas provides free, impartial guidance on employment rights and disputes.

• GOV.UK publishes official updates and statutory guidance.

• You can also speak to your HR department, trade union, or an employment law adviser for personalised support.

If you believe your employer has not met the requirements of the Employment Rights Bill, you can speak to our specialist advisers for support.

Visit www.cabb.org.uk/get-help to make a web referral, or call our Freephone Adviceline on 0800 144 8848.