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Employment Law Changes & Predictions: Latest Updates
July 15, 2024
The Employment Rights Bill (ERB) is in its final stages of review, and is currently in a state of “parliamentary ping pong”, until the final wording is agreed between the House of Commons and House of Lords. Following this, the ERB will receive royal assent and become law – marking a pivotal transformation for employment law. However, it is worth noting that many of the reforms will not take effect until 2026 at the earliest, which is later than originally expected.
We break down the latest changes and revisions below.
| Change | Latest Update | Key Enforcement Dates |
| Unfair Dismissal Rights | Employees will have the right not to be unfairly dismissed after a 6-month qualifying period. This is a reduction from the current 2-year threshold but a significant change from the previous “Day one unfair dismissal rights” that was planned for 2027. This change is now expected to be brought in more quickly than the previous planned change.
In addition to the 6-month service requirement, the “compensation cap” of a year’s salary in unfair dismissal claims is also now expected to be removed and replaced with an upper threshold of approximately £120,000, significantly increasing the maximum value of many unfair dismissal claims. |
Expected to take effect in 2026. |
| Changing Zero-Hour Contracts/Right to Minimum Working Hours | Workers on zero hours/low hours contracts will have the right to be offered guaranteed hours after the first 12 weeks, if they have worked more than the minimum hours set out in their contract during that time (subject to certain exceptions). Also applies to agency workers, with the hirer having responsibility for offering regular hour contracts. | Expected to take effect in 2027. |
| Employment Tribunal Claims | The ERB extends the time limit for bringing Employment Tribunal claims (including discrimination and unfair dismissal) from 3 months to 6 months. | Expected to take effect in October 2026. |
| Duty to Prevent Sexual Harassment | The ERB strengthens the duty to prevent sexual harassment (brought into force on 26 October 2024), with the expansion of employer liability for harassment (of any kind) by third parties, such as clients or customers, unless they take “all reasonable steps” to prevent it. Protections for employees reporting sexual harassment have also been strengthened, with it now being a protected disclosure for whistleblowing purposes. | New whistleblowing protections expected to take effect in April 2026; and
Heightened duty to prevent third party harassment expected to take effect in October 2026. |
| Ending Fire and Re-Hire | It will be automatically unfair to dismiss an employee for refusing to agree changes to their terms of employment (other than in cases of severe financial difficulty on the part of the employer). The ERB narrows the circumstances in which “fire and rehire” can be used. | Expected to take effect in October 2026. |
| Extending protection from dismissal for pregnant employees and new parents | It will be unlawful to dismiss employees who are pregnant, on maternity, adoption or shared parental leave, or within 6 months of returning to work – except in specific circumstances (to be set out in future regulations). | Expected to take effect in 2027. |
| Collective Redundancy Consultations | The ERB tightens the collective consultation requirements in two respects: by introducing an additional threshold test, based on the number of redundancies across the business as a whole; and by increasing the maximum penalty (the “protective award”) for breaching the collective redundancy consultation requirements from 90 days’ pay to 180 days’ pay per employee. | Increase to protective award expected to take effect in April 2026; and
New collective redundancy threshold expected to take effect in 2027. |
| Creation of Fair Work Agency | New body to strengthen the enforcement of employment rights. The FWA will have the power to bring Employment Tribunal claims on behalf of workers, and will have enforcement powers over minimum wage, agency rules, and holiday pay, including the ability to conduct workplace inspections. | Expected to launch in April 2026. |
| Protection of public sector workers in outsourcing TUPEs | Protections to be brought in to prevent a “two-tier workforce”, when public sector employees TUPE transfer to private firms, by ensuring that both new and existing employees are treated “no less favourably” than each other. | Expected to take effect in October 2026. |
| Stronger rights to flexible working | Right to request flexible working to be strengthened, as employers will only be able to refuse a request if it is reasonable to do so. An employer’s ability to refuse a request based on the 8 specified business grounds will remain. | Expected to take effect in 2027. |
| Rights for shift workers | Right for shift workers (including zero hours/minimum hours workers, and those without a set working pattern) to be given reasonable notice of shifts and compensation if shifts are changed or cancelled at short notice. | Consultation paper expected to be published by the end of 2025 – change not expected to take effect until 2027. |
| Pay | Statutory sick pay (SSP) to become payable from day 1 of sickness and payable for the first 3 qualifying days of sickness. Entitlement to SSP will be increased to the lower of 80% of salary or the standard SSP rate, giving more sick pay entitlement to lower paid workers. |
Expected to take effect in April 2026.
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| Requirement to Keep Records of Holiday Pay | New obligation for employers to keep records of their compliance with holiday entitlement and pay rules for 6 years. Failure to comply will be a criminal offence. | Expected to take effect in April 2026. |
| Statutory right to equal pay for ethnic minority employees and those with disabilities | Set out in draft Equality (Race and Disability) Bill – which extends existing equal pay laws to cover ethnicity and disability. | Draft bill expected by early 2026. |
| Disability/Ethnicity Pay Gap Reporting | Set out in draft Equality (Race and Disability) Bill – which introduces a new mandatory pay gap reporting model for ethnicity and disability. | Draft bill expected by early 2026. |
| Trade Union Rights | Rules on statutory union recognition will be loosened.
Employers will be required to inform workers of their right to join a union in their contract of employment/statement of terms on day 1 of their employment. Trade union officials will have more rights to access workplaces for recruitment and collective bargaining purposes. |
Simplifying recognition process expected to take effect in April 2026.
Duty to inform employees and right of access expected to take effect in October 2026. |
| Right to Bereavement Leave | Current right to statutory parental bereavement leave to be extended to the loss of certain other close family members or dependants – expected to be a day 1 right and to give entitlement to 1 week’s (unpaid) leave for loss of a family member (details of which family members are covered to be set out in regulations). | Consultation has been launched by the Government, which closes on 15 January 2026.
Likely to take effect in 2027. |
| Right to Bereavement Leave for Pregnancy Loss | The new right to bereavement leave will also include pregnancy loss that occurs before 24 weeks of pregnancy, which will entitle mothers and their partners to at least 1 week’s unpaid leave. | Likely to take effect in 2027. |
| Right to Paternity Leave from Day 1 | Removal of the current requirement for 26 weeks’ service before an employee is eligible for statutory paternity leave. | Expected to take effect in April 2026. |
| Parental Leave from Day 1 | Parental leave (unpaid) to be a statutory right from day 1 of employment. Government to also conduct a wider review of the parental leave system (separate from the ERB) and consider introducing paid carers’ leave. | Expected to take effect in April 2026.
Wider review launched on July 1 2025, and is expected to run for 18 months – likely to take effect in early 2027. |
| Changes to Equality action plans | Employers to include an explanation in their equality action plans on how they are supporting employees with menopause, menstrual problems, or menstrual disorders. | Measures expected to be introduced on a voluntary basis in April 2026, before coming into force in 2027. |
Our employment lawyers can offer advice and direction for any employers who are concerned about what they should be doing next. Contact us on 029 2082 9100 or via our Contact Us form for a free initial chat to see how we can help you.
To speak to one of our experts today, please contact us on 02920 829 100 or by using our Contact Us form for a free initial chat to see how we can help.
