As we surpass 100 days since the UK election, the new Employment Rights Bill introduced several significant changes aimed at enhancing worker protections, providing fairer conditions, and supporting business compliance.
Although most of the changes are not expected to come into effect until sometime in 2026 and consultation will still need to take place to understand exact regulations, employers should be aware of roughly what’s on the horizon to better plan and prepare. Here’s a look at some of the most impactful provisions.
The Bill introduces new day-one rights, a controversial change allowing employees to claim unfair dismissal from the very start of their employment. This will be paired with a statutory probationary period, initially proposed as nine months, during which employers can end employment without undergoing a complete dismissal process for performance related concerns. It is likely that employers will still need to undergo a full process for matters such as conduct or redundancy. In addition, employees will gain immediate rights to paternity leave, unpaid parental leave, and a new statutory paid bereavement leave. Detailed regulations will follow.
Changes to Statutory Sick Pay aim to make it more accessible to all. The Bill removes the three-day waiting period for SSP eligibility, allowing employees to receive payments starting from their first day of absence. They also plan on removing the current minimum earnings threshold of £123 per week, making SSP available to more low-income workers. Consultations will take place to decide on a new SSP rate (likely to be a percentage of earnings) for those earning below the current threshold.
Employees’ rights to request flexible working will be strengthened, although the right remains a request rather than a guarantee. Employers retain the ability to deny these requests if the reason for refusal is one of the eight specified statutory grounds and it’s communicated to the employee that it is reasonable to refuse on that basis. This change aims to strike the balance between supporting work-life balance and allowing businesses to manage their operational needs.
Responding to calls for an end to “exploitative” zero-hours contracts, the Bill introduces the right to a guaranteed-hours contract for employees who regularly work over a 12-week reference period. This ensures that workers on recurring schedules can secure stable hours. For those who prefer the flexibility of zero-hours contracts, that option will remain. The Bill also mandates reasonable notice of shift changes and compensation for shifts cancelled or cut on short notice, enhancing predictability for low-hours workers.
The Bill introduces measures to restrict “fire and rehire” practices, where employers dismiss employees and then re-engage them on new, often less favourable, terms. Under the proposal, fire and rehire would be considered an automatic unfair dismissal, except in specific cases where financial hardship leaves an employer no other option.
New protections will safeguard pregnant employees and parents returning from family leave against dismissal for six months post-return. Specific regulations will outline the limited circumstances in which dismissals of these employees may occur.
The Bill enhances harassment protections under the Equality Act 2010 by introducing specific protections against third-party harassment and strengthening the employers’ duty to prevent sexual harassment which is coming into place on 26 October 2024. Employers will now be required to take “all reasonable steps” to prevent harassment, shifting the expectation to a higher standard than stated before. Additionally, sexual harassment will join the list of protected disclosures.
The Bill eliminates the need for redundancies to occur “at a single establishment” when determining whether collective consultation and protective awards are required. Currently, this requirement is only triggered if a certain number of redundancies occur at a single site.
Large employers will be required to develop and publish action plans addressing gender pay gaps and supporting employees through menopause. This provision goes beyond the current guidelines, which are only recommendations.
The Bill proposes the establishment of a Fair Pay Agreement within the adult social care sector, ensuring fair wages in this critical field. It also reinstates the School Support Staff Negotiating Body. Additionally, the government plans to eliminate age-based National Minimum Wage (NMW) bands, instead focusing on living cost considerations when setting annual NMW rates, with the aim to provide fairer pay structures for younger workers.
To enhance the enforcement of employment rights, the Bill establishes the Fair Work Agency. This new body will consolidate existing enforcement functions such as HMRC’s NMW enforcement unit, the Labour Abuse Authority, and the Employment Agency Standards Inspectorate. It will provide a comprehensive framework for enforcing these new standards while supporting employers in compliance.
The government also published a document that outlines ‘Next Steps’ and future reforms. These include:
We will continue to provide updates as this topic evolves. In the meantime, if you would like to speak to a member of our professional HR team regarding how to best prepare your organisation for changing employment laws, get in touch with us today.
