What does the Employment Rights Bill contain?

Employment and immigration01.12.202510 mins read

Key takeaways

Major reforms to day-one employee rights

Sick pay and paternity leave entitlements start immediately. Day-one unfair dismissal proposals abandoned.

New rules target insecure work contracts

Zero-hours and ‘fire and rehire’ face tighter controls.

Employers must prepare for wide-ranging changes

New enforcement bodies and sector rules are incoming.

The Employment Rights Bill, which is currently progressing through Parliament, will enact many of the government’s manifesto commitments to improve the employment rights of workers and employees. This tracker considers the main details of the Employment Rights Bill, which once passed into law will provide for the biggest employment rights shake-up in a generation.

The Bill is now nearing the end of its parliamentary journey, but the government has faced challenges persuading the House of Lords to vote for certain aspects of the Bill – including day-one unfair dismissal rights – so the Bill remains in a period of parliamentary ‘ping-pong’ until the two Houses of Parliament can reach agreement.

In a shock move, on 27 November 2025, the government announced that agreement had been reached with key stakeholders on the unfair dismissal elements of the Bill and that it was u-turning on the introduction of a day-one right to claim unfair dismissal. It is now proposed that employees will need 6 months’ service to claim unfair dismissal (unless for automatically unfair or discriminatory grounds). The government also intends to lift the unfair dismissal compensation cap.

Key votes on the Bill will now take place on 8 December 2025 (in the House of Commons) and on 10 December (in the House of Lords). Allowing for these key votes, it now seems likely that the Employment Bill will probably receive Royal Assent in mid to late December 2025.

We have updated this tracker with the current planned implementation dates, but it is not yet clear whether the delays to the Bill receiving royal assent will impact on the government’s planned implementation roadmap for the Employment Rights Bill.

Unfair dismissal protection after 6 months

In what would have been the most radical change to unfair dismissal law in over 50 years, the Employment Rights Bill originally proposed that the right not to be unfairly dismissed would become a day-one right. However, the government was unable to persuade the House of Lords to vote in favour of this change and the Bill was caught up in a period of parliamentary ‘ping-pong’.

In a shock move, on 27 November 2025, the government announced that agreement had been reached with key stakeholders on the unfair dismissal elements of the Bill and that it was u-turning on the introduction of a day-one right to claim unfair dismissal. It is now proposed that employees will need 6 months’ service to claim unfair dismissal (unless for automatically unfair or discriminatory grounds). The government also intends to lift the unfair dismissal compensation cap, although it is currently less clear precisely what this means (we will update this tracker when more detail emerges).

The government had originally confirmed that the unfair dismissal aspects of the Employment Rights Bill (i.e. day-one unfair dismissal) would not be brought into force before 2027. However, due to the switch to a 6-month qualifying service requirement, it is currently uncertain whether this original timetable stands.

Day-one right to paternity and unpaid, parental leave

The Employment Rights Bill creates day-one rights to paternity leave and unpaid parental leave. Employees currently require 26 weeks’ service to qualify for those rights. There is no link to pay within the paternity leave proposals, so there will be a day one entitlement to paternity leave but not to paternity pay (mirroring the maternity pay situation). The government has committed to implement these new rights in April 2026.

Bereavement leave

The Employment Rights Bill creates a new day-one right to unpaid bereavement leave, which is modelled on adapting the existing parental bereavement leave regime, covering the death of a wider category of relatives. Where more than one relative has died, the secondary legislation must entitle the bereaved employee to bereavement leave in respect of each death.

Regulations will flesh out the finer details this wider form of bereavement leave. The government is currently consulting on the contents of that secondary legislation. Key points arising from the consultation document include:

  • The scope of the familial relationships which will fall within the general bereavement leave provisions (for example, whether this should cover immediate family members only, apply to a wider category of extended family relationships, or be based on the importance that person played in the employee’s life);

  • Whether employees should be able to take one, two or more weeks of unpaid bereavement leave, or whether the length of the available leave should vary depending on the circumstances (for example, depending on the closeness of the familial relationship);

  • Whether employees should be required to take bereavement leave continuously in a single block or allowed to take it discontinuously (for example, broken into units of either one week or one day); and

  • Whether employees should be required to use up their bereavement leave within 56 days, one year or 56 weeks of the bereavement (the latter allowing for the celebration of the anniversary of the death).

The government plans to implement this extended bereavement leave at some point in 2027.

Pregnancy loss/miscarriage leave

The Employment Rights Bill introduces a new form of bereavement leave for pregnancy loss. This will allow cover pregnancy losses before 24 weeks of pregnancy. Although it is sometimes referred to as ‘miscarriage leave’ this is somewhat of a misnomer because its scope is wider.

  • Regulations will flesh out the finer details of pregnancy loss leave. The government is currently consulting on the contents of that secondary legislation. Key points arising from the consultation document include:

  • Which forms of pregnancy loss should qualify – as well as miscarriage should this also include other forms of pregnancy loss such as abortions, ectopic pregnancy, vanishing twin syndrome and IVF embryo transfer loss;

  • Whether pregnancy loss leave should only be available to the person that suffers the pregnancy loss or perhaps extended to their spouse/civil partner, the other parent, the intended co-parent or any intended parents in a surrogacy arrangement;

  • Whether employees should be able to take one, two or more weeks of unpaid leave following a pregnancy loss;

  • Whether employees should be required to take pregnancy loss leave continuously in a single block or discontinuously (for example, broken into units of either one week or one day); and

  • Whether employees should be required to use up their leave within 56 days, one year or 56 weeks of the pregnancy loss.

The government plans to implement bereavement leave for pregnancy loss at some point in 2027.

Extension of limitation periods

The Employment Rights Bill will extend the time limit to bring most employment claims to six months (from three months). The government plans to implement this change in October 2026. Wrongful dismissal claims will continue to have a three-month time limit.

Statutory sick pay reforms

The Employment Rights Bill will remove the requirement to earn at least the lower earnings limit (currently £125 per week) to be entitled to statutory sick pay (SSP). This will mainly help those working only a small number of hours each week, apprentices and young workers who are entitled to lower levels of national minimum wage and lower-paid casual workers.

The Bill will also remove the current 3-day waiting period for entitlement to SSP, meaning that SSP will be payable from day one of absence, as it was temporarily during the Covid-19 pandemic.

The government has confirmed its decision to introduce a taper to the current SSP rate (currently £118.75 per week) for those earning below the lower earnings limit, so that they are entitled to whichever is the lower of 80% of their average weekly earnings or the current SSP flat rate.

The SSP reforms are due to be implemented in April 2026. As the cost of SSP is no longer recoverable from the government, employers that do not currently offer staff sick pay from the first day of absence will face additional financial burdens.

Flexible working by default from day one

The Employment Rights Bill adapts and builds on the April 2024 reforms to flexible working. An employer will only be permitted to refuse a flexible working request if:

  1. It considers that specified business ground(s) apply; and

  2. If it is “reasonable” for the employer to refuse the request on that ground(s).

The business grounds an employer can rely on replicate those currently in use.

Regulations will specify the steps an employer must take in order to comply with the requirement to consult an employee before rejecting a flexible working request.

Where the employee’s flexible working request is refused, the employer will be required to notify the employee of the ground(s) for the refusal and explain why it considers it “reasonable” to refuse the request. In practical terms, this means that the employer must go beyond simply referring to one of the permitted reasons for refusal, it must actually explain why it believes that reason applies. It is anticipated that regulations will specify that the employer must provide a written notice of its reasons for refusal.

The employment tribunal will also have a new power to consider a claim that the employer has “failed to act” in accordance with the above requirements. This appears to allow an employee to claim that it was not “reasonable” for the employer to reject their flexible working request on the cited business ground(s). Essentially, this appears to give the employment tribunal the power to check the employer’s rationale and ask: was it “reasonable” for the employer to refuse the request on the cited business ground? How much evidence tribunals will expect from employers before accepting their business rationale, and how they will decide the question of reasonableness, is not yet clear.

These flexible working reforms will come into force at some point in 2027. The government has indicated its intention to consult on these rights in 2026.

Collective redundancy reform

The Employment Rights Bill contains provisions designed to tighten up and reform the law relating to collective redundancy situations. Initially, the Bill contained provisions which would calculate collective consultation thresholds across all an employer’s sites. However, amendments to the Employment Rights Bill have since softened this, so that the trigger for the collective consultation duty will be either:

  • 20 or more job losses at a single establishment/site within 90 days; or

  • a minimum threshold of job losses (to be specified in regulations – will be more than 20 – could be a fixed number or percentage of the workforce) across more than one establishment/site within 90 days.

This amendment will no doubt come as a great relief for employers operating across multiple sites/locations, who feared they would need to be in a state of continual multi-site collective consultation. A further amendment confirms that, where multi-site collective consultation is required, whilst this must be carried out with all appropriate representatives, it need not be carried out with them all together or with a view to reaching the same agreement with all of them. This reform will be implemented in 2027.

The government has also published the outcome of its Autumn 2024 consultation on strengthening remedies against abuse of rules on collective redundancy and fire and rehire. The response confirms that the government has decided to:

  • Double the maximum penalty for non-compliance with collective consultation obligations from 90 to 180 days’ gross pay per affected worker; and

  • Not to proceed with the introduction of interim relief for employees who bring claims for the protective award for failure to collectively consult and/or who bring unfair dismissal claims related to breach of the new restrictions on fire and rehire/fire and replace.

The government has since said that the doubling of the collective redundancy protective award will occur in April 2026.

The government intends to gather further views on strengthening the collective redundancy framework later in 2025.

The Employment Rights Bill also amends the redundancy notification obligations in certain cases involving redundancies of ships’ crews.

New restrictions on "exploitative" zero-hours contracts

The Employment Rights Bill stops short of “barring” zero-hours contracts, but employers will not be allowed to require zero-hours workers to comply with “one sided” flexibility requirements. The government wants to ensure that all jobs provide a baseline level of security and predictability.

To achieve this, there will be a new right for zero, low or irregular hours workers to a “guaranteed hours offer” which reflects the number of hours they have regularly worked over an, as yet unspecified, reference period (expected to be 12 weeks), provided their work history satisfies certain conditions in respect of number, regularity or otherwise of the working hours.

This is a “right to receive” a guaranteed hours offer (essentially a positive obligation on employers to proactively make guaranteed hours offers). The House of Lords initially sought to amend the Employment Rights Bill to replace this with a “right to request” a guaranteed hours offer instead (essentially giving eligible workers the choice whether to request a guaranteed hours offer). However, the House of Commons disagreed with this amendment. On 28 October 2025, the government were defeated in a key vote and the House of Lords insist that workers should be able to opt-out of receiving guaranteed hours offers. The government must now decide whether to concede or force a new vote on this.

Workers will also have special legal protection against detriment/dismissal and in connection with the terms of the guaranteed hours offer.

These changes are due to be implemented at some point in 2027.

The Employment Rights Bill also:

  • introduces new information requirements:

    • employers must ensure workers who have the potential to qualify for a guaranteed hours offer are given information about their guaranteed hours rights during an initial two-week information period; and

    • where the employer’s duty to make a guaranteed hours offer to the worker does not apply, or an offer already made is treated as having been withdrawn, the employer must give a notice to the worker stating this.

  • allows a worker to bring a claim if they suffer a detriment in relation to the employer’s duty to provide the worker with a guaranteed hours offer.

Additionally, there are provisions designed to give workers reasonable notice of shifts and to proportionately compensate them when shifts or working times are cancelled/curtailed by an employer without reasonable notice.

Regulations will flesh out much of the detail of these proposals, including:

  • the detail of the specific conditions that will need to be satisfied in order to qualify for a guaranteed hours offer

  • the length of the relevant reference period

  • how, when and in what form the guaranteed hours offer must be made

  • what info the guaranteed hours offer must include

  • the amount of notice of shift variations that will be considered reasonable

  • the form and manner in which the employer must give notice of shift changes

  • what is meant by ‘short’ notice of shift changes

  • the amount and timing of the compensatory payment payable for changes to shifts at short-notice

The Employment Rights Bill also extends these new rights to agency workers as follows:

  • the employment agency will have duties to:

    • make a guaranteed hours offer to an eligible agency worker;

    • pay the agency worker any payments for short-notice shift changes, curtailments or cancellations (although they are free to agree recoupment provisions with the end-user/hirer and there will be an express power to recover for any contracts signed before two months after the Bill receives Royal Assent); and

  • the employment agency and end-user/hirer will jointly have the duty to:

    • provide the agency worker with reasonable notice of shifts, including shift changes, curtailments and cancellations.

Additional new provisions seek to further protect agency workers by ensuring their pay can’t be eroded through a guaranteed hours offer and deeming them to be a worker of the end-user when they accept a guaranteed hours offer.

Further restrictions on 'fire and rehire'/'fire and replace'

A new statutory Code of Practice on fire and rehire/dismissal and re-engagement came into force on 18 July 2024 (our summary here), but this will be enhanced by further restrictions in the Employment Rights Bill. The original proposal has since been amended to change this part of the Bill significantly.

Original proposal (since abandoned)

Under its original drafting, the Bill provided for a new automatically unfair reason for dismissal where the employer:

  1. Sought to vary the contract and the employee did not agree to the variation; and

  2. Was seeking to employ another person, or re-engage the employee under a varied contract of employment, to carry out “substantially the same duties as the employee carried out before being dismissed”. This includes both fire and rehire, and fire and replace scenarios.

The employer could only avoid an automatically unfair dismissal if it is able to satisfy the employment tribunal of two narrowly drafted conditions:

  1. Condition 1: that the reason for the proposed variation was to eliminate, prevent or significantly reduce, or significantly mitigate the effect of, any financial difficulties which at the time of the dismissal were affecting, or were likely in the immediate future to affect, the employer’s ability to carry on the business as a going concern or otherwise to carry on the activities constituting the business; and

  2. Condition 2: that in all the circumstances the employer could not reasonably have avoided the need to make the variation.

If both those conditions are satisfied, the tribunal would go on to consider whether the fairness of the dismissal(s) in the usual way.

New proposal (proceeding)

The fire and rehire/replace provisions of the Employment Right Bill have subsequently been heavily amended to tighten up their applicability.

The revised Employment Rights Bill creates what we are calling the ‘new triple lock’ – two new automatic unfair dismissals (subject to a severe financial distress defence) and one new ordinary unfair dismissal with special fairness considerations.

Firstly, the revised Employment Rights Bill creates a new automatically unfair reason for dismissal where, save for cases involving severe financial difficulties, the only or principal reason for the dismissal is:

  • The employer sought to make a ‘restricted variation’ (or more than one variation including a restricted variation) to the employee’s contract of employment which the employee did not agree to; and

  • The employer dismissed so it could employ another person, or re-engage the employee, under a varied contract of employment to carry out substantially the same duties.

For these purposes a ‘restricted variation’ will include:

  • negative changes to pay (but not expenses and benefits in kind)

  • pensions/pension schemes

  • hours of work

  • changes to the number of hours worked

  • specified variations to the timing/duration of shifts

  • a reduction in the amount of time off an employee can take

  • the inclusion of a contract term permitting those restricted variations without the employee’s consent

  • other matters to be specified in regulations

The employer can only avoid an automatic unfair dismissal if it can prove:

  • it was in serious financial difficulties; and

  • It could not reasonably have avoided the need to make restricted variation.

The reason for making the ‘restricted variation’ must be to eliminate, prevent or significantly reduce/mitigate the effect of financial difficulties affecting (or in the immediate future likely to affect) the employer’s ability to carry on the business as a going concern. We expect this to be interpreted narrowly – this is not about improving profitability, but rather about business survival.

  • Secondly, the revised Employment Rights Bill also creates a new automatically unfair reason for dismissal where, save for cases involving severe financial difficulties (applying the same test outlined above), the only or principal reason for the dismissal is:

    • to replace the employee with someone who is not an employee of the employer (e.g. worker, agency worker or a self-employed contractor);

    • the new person (alone or with others) is hired to carry out activities that are the same, or substantially the same, as that undertaken by the dismissed employee (alone or with others) prior to their dismissal; and

    • not wholly or mainly attributable to the fact that the requirements of the employer’s business for those activities to be carried out have ceased or diminished (or are expected to).

For this type of automatically unfair dismissal claim, it does not matter if the employee replaces themselves on a non-employed basis – for example if the employment contract is terminated so that they can be offered a worker or self-employed contract instead.

  • Thirdly, the revised Employment Rights Bill also creates a new ordinary unfair dismissal claim where the only or principal reason for the dismissal is:

    • The employer sought to make a non-restricted variation (or more than one variation none of which were restricted) to the employee’s contract of employment which the employee did not agree to; and

    • The employer dismissed so it could employ another person, or re-engage the employee, under a varied contract of employment to carry out substantially the same duties.

Special fairness considerations will apply to this sort of ordinary unfair dismissal claim, with tribunals required to consider:

  • the reason for the variation

  • any consultation carried out by the employer with the employee about varying the contract of employment

  • any consultation with a recognised TU

  • any consultation with another employee representative body (e.g. I&C body)

  • anything offered to the employee in return for agreeing to the variation

  • any other matters (specified in regulations)

There are also broader exceptions for some local authorities.

These new provisions will be implemented in October 2026.

Finally the government has decided:

  • to double the maximum penalty (protective award) for non-compliance with collective consultation obligations from 90 to 180 days’ gross pay per affected worker; and

  • not to proceed with the introduction of interim relief for employees who bring claims for the protective award.

This change will come into force in April 2026.

Protection from harassment

The Employment Rights Bill enhances the duty to prevent sexual harassment (which came into force on 26 October 2024) by requiring an employer to take ‘all’ reasonable steps to prevent harassment (currently it is “reasonable steps”). It includes new power to specify, by regulations, what ‘all reasonable steps’ will entail (currently what are considered “reasonable steps” relies on non-statutory technical guidance issued by the EHRC). This will come into force in October 2026.

There are provisions designed to re-introduce protection against third party harassment, but the employer will only be liable if they have failed to take all reasonable steps to prevent this. This will extend to all forms of harassment, not just sexual harassment. These will also come into force in October 2026.

Further, reporting sexual harassment will amount to a protected disclosure for the purposes of whistleblower protection. This will apply from April 2026.

Confidentiality provisions (NDAs) void if prohibit disclosure of harassment/discrimination

The revised Employment Rights Bill includes provisions which render any confidentiality/non-disclosure provision (often called NDAs) in an agreement between an employer and a worker (whether in an employment/worker contract or not) void and unenforceable, if the provision(s) purport to prevent a worker (whether they are a victim or witness) from making an allegation or disclosing information relating to work-related harassment and discrimination. Regulations will except some agreements and can specify who is covered by these provisions (for example, to include self-employed consultants and those in work experience/training).

Equality action plans

The Employment Rights Bill contains provisions which allow for regulations requiring public sector and large (250+ staff) employers to publish equality action plans no more than once a year. An equality action plan must show the steps that the employer is taking in relation to their employees with regard to:

  • gender equality, including addressing the gender pay gap;

  • supporting employees going through the menopause; and

  • menstrual problems/disorders.

Regulations may also set out certain requirements in respect of equality action plans, such as their contents, frequency of publication and any requirements for senior approvals.

These changes are expected to become mandatory from 2027.

Whistleblowing

The Employment Rights Bill provides that reporting sexual harassment will amount to a protected disclosure for the purposes of whistleblower protection. It will still be necessary to show that the worker believed their disclosure to be in the public interest though. This is expected to apply from April 2026.

The House of Lords initially sought to amend the Employment Rights Bill to include new provisions regarding whistleblowing, but these were rejected by the House of Commons and the House of Lords, in line with parliamentary conventions, conceded the point, so those amendments will not proceed.

Major reforms of trade union legislation/recognition

In a significant set of changes, which are expected to create a golden age for trade unions, the Employment Rights Bill:

  • Repeals many of the industrial relations reforms introduced by the last government (e.g. strike ballot thresholds, the sector-based minimum service level rules for strikes)

  • Places a new requirement on employers to remind workers alongside their written statement of employment terms (s1 statement) that they have the legal right to join a trade union, even where the employer does not recognise union(s), and they must regularly remind workers of this right. Regulations will flesh out much of the finer detail and the government is currently consulting on their proposed contents. Key issues explored in this consultation include:

    • Should the statement give workers a brief overview of the functions of a trade union, a summary of the statutory rights associated with union membership, a list of all trade unions that the employer recognises (if any) and/or signpost to a GOV.UK page with list of trade unions?

    • Should the statement adopt standardised wording (the government’s preference) or should employers be allowed to draft their own statement?

    • Should the statement be delivered directly by email/letter or indirectly e.g. by notice board/Intranet? The government’s preference is that the statement should be delivered to new workers alongside their written statement of employment terms/contract and to existing workers through either method.

    • The frequency with which the statement must be reissued after the beginning of employment – should this be every 6 months, annually or at a sector specific frequency. The government’s preference is for annual reminders.

  • Gives trade unions new rights to access workplaces in a regulated and responsible manner to meet, represent, recruit, and organise members in workplaces. Regulations will flesh out much of the finer detail and the government is currently consulting on these access rights. Key issues explored in this consultation include:

    • The information that should be included in the trade union’s request for access.

    • The information that should be included in the employer’s response.

    • The form and manner of the access request and employer’s response notices.

    • Notifications to the Central Arbitration Committee (CAC) and CAC determinations.

    • Circumstances where access must not be granted/where it is reasonable for access not to be granted.

  • Reforms various aspects of existing trade union law to:

    • remove restrictions on TU activity

    • make ballots simpler and more flexible (including electronic ballots)

    • prevent the replacement of strikers with agency workers

    • lower the threshold of support required for TU recognition and simplify the statutory recognition process

  • Makes provision for enhanced facilities time for trade union reps to perform their duties

  • Creates new protections for TU equality reps, and against TU-related intimidation, dismissal and blacklisting

On 6 August 2024, the government announced plans to repeal the current minimum service level legislation. In the interim, until this repeal legislation is passed, the government strongly encourages employers to seek alternative mechanisms for dispute resolution, including voluntary agreements, rather than imposing minimum service levels.

In the outcome of its Autumn 2024 consultation on creating a modern framework for industrial relations, the government confirmed its intention to:

  • make changes to ballot thresholds. However, the House of Lords, has insisted that the voting turnout must be 50% for industrial action ballots and it is not clear if they will continue to do so.

  • extend industrial action ballot mandates to 12 months;

  • simplifying the information unions are required to provide in industrial action notices and require trade unions to give employers 10 days’ notice of industrial action;

  • allow trade unions greater physical access to workplaces (which are not dwellings) and digital access to workers, for any purpose including supporting workers with an employment-related matter;

  • restrict unfair practices during the trade union recognition / derecognition process – there will be binding access arrangements during the process, new staff hired during the process will not ‘count’, nor can an employer start its own ‘sweetheart’ union to avoid recognition; and

    • remove the 10-year ballot requirement on political funds, but require trade unions to notify staff once every 10 years that they can opt-out. However, the House of Lords has, insisted that workers should be required to ‘opt in’ to make political fund contributions, and it is not clear whether it will continue to do so.

The consultation response also confirms the government’s intention, once the Bill has received Royal Assent, to further consult on modernising trade union law.

Implementation of the trade union reforms will be phased, with key highlights including:

  • Various measures relating to trade unions and industrial action will take effect at Royal Assent or soon afterwards including the repeal of the Strikes (Minimum Service Levels) Act 2023, repeal of the great majority of the Trade Union Act 2016, removal of the 10-year ballot requirement for trade union political funds, simplification of industrial action notices and industrial action ballot notices and protection against dismissal for taking industrial action

  • In April 2026, the trade union recognition process will be simplified, and electronic balloting will be introduced

  • In October 2026, further trade union related reforms will come into force (e.g. duty to inform workers of their right to join a trade union, access rights for trade unions, increased dismissal protection)

Creation of a single enforcement body: Fair Work Agency

The Employment Rights Bill provides for the creation of new single enforcement body – the Fair Work Agency – which will have strong powers to:

  • Inspect workplaces

  • Undertake targeted and proactive enforcement work

  • Bring civil proceedings

  • Act against worker exploitation

The Fair Work Agency will be responsible for enforcing worker rights such as holiday pay, national minimum wage, statutory sick pay, the employment tribunal penalty scheme, labour exploitation and modern slavery.

This Fair Work Agency will be “a stronger, recognisable single organisation that people know where to go for help – with better support for employers who want to comply with the law and tough action on the minority who deliberately flout it”.

The revised Employment Rights Bill gives the new Fair Work Agency various legal powers where employers are in breach, including powers to:

  • issue notices of underpayment (including for national minimum wage, statutory sick pay and holiday pay) going back up to 6 years but uprated to current rates;

  • issue penalty notices of 200% of the underpayment (minimum £100, maximum £20,000 per underpaid worker);

  • bring employment tribunal proceedings/provide legal assistance to workers, and recover costs from the losing side; and

  • recover its enforcement costs from the defaulting employer (regulations will specify how these enforcement costs will be assessed).

The Fair Work Agency will be established in April 2026, so employers should use this time wisely to ensure they are fully compliant with laws around holiday pay, national minimum wage, sick pay etc.

Creation of Office for Equality and Opportunity

The Employment Rights Bill creates a new Office for Equality and Opportunity to oversee equality policy and legislation in the UK, replacing the Equality Hub. Its immediate priorities will be:

  • Strengthening the legal duty for employers to create and maintain working conditions free from harassment (through the Worker Protection Act)

  • Enshrining in law the full right to equal pay for ethnic minority people and disabled people

  • Delivering a full trans-inclusive ban on conversion practices

  • Championing the rights of disabled people

  • Focusing on socio-economic disparities.

Protection of new mothers and those on family friendly leave

The Employment Rights Bill will strengthen the existing protections during pregnancy, during and for a ‘protected period’ following periods of family-friendly leave. The protected period must be for at least six months after returning to work.

These rights will be fleshed out in regulations, the contents of which the government is currently consulting on. Key issues explored in this consultation include:

  • In what circumstances should dismissals be allowed?

  • When the period of protection starts and ends? For example, should the protected period be 6 months post return-to-work or 18 months post birth/adoption?

  • Which parents/forms of family-friendly leave should be covered?

  • How to increase awareness of these new rights?

This extended protection is expected to be implemented in 2027.

Public sector outsourcing: two-tier workforce

The Employment Rights Bill contains provisions which are designed to protect workers working for the public sector under outsourcing arrangements, to ensure those workers are not treated less favourably than any staff who transfer in from the public sector and that there is no ‘two-tier’ workforce. These will be implemented in October 2026.

Tipping Policy: consultation

The Employment Rights Bill contains changes to the new regime for the fair and transparent distribution of tips, gratuities and service changes (which came into force on 1 October 2024). For example, employers will be required to consult with any recognised trade union(s) or with workers directly where there is no union, regarding the first version of any Tipping Policy and publish summary details of the views expressed in that consultation to the affected workers. They must also review any Tipping Policy once every three years. These provisions will be implemented in October 2026.

Umbrella companies

The government’s response to the Summer 2023 consultation on tackling non-compliance in the umbrella company market, confirms the government’s intention to:

  • bring umbrella companies within the definition of an employment business for the purposes of the Employment Agencies Act 1973 and the agency conduct regulations; and

  • introduce a scheme akin to IR35/off-payroll working to move liability to operate/pay PAYE within the contractual chain away from the umbrella company to either the agency or end-user/hirer

The government plans to implement these changes in 2027.

Sector-specific changes: adult social care and education

The Employment Rights Bill contains provisions designed to:

  • Establish a Fair Pay Agreement in the adult social care sector

  • Reinstate the School Support Staff Negotiating Body, to establish national terms and conditions, career progression routes, and fair pay rates

Timeline for implementation and preparing for the changes

It seems likely that the Employment Rights Bill’s parliamentary passage will complete soon and that the Bill will receive Royal Assent at some point in December. Thereafter, much of the finer detail in the proposals above will need to be fleshed out via secondary legislation/regulations, all of which will be subject to consultation. We have indicated known implementation dates in the sections above.

Although not all of the changes will impact all employers, we recommend that employers use this lead-up time wisely to tighten up their existing procedures ready for the new rules being implemented.

Please contact your usual Hill Dickinson lawyer or the author for further support.

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