Are you ready for the Employment Rights Act?

October 23, 2025

What do we know?

The Employment Rights Bill introduces the biggest changes to UK employment law in a generation; employers need to be aware of the impending changes and start preparing now.

It is, in theory, nearing the end of its journey through Parliament and should soon receive Royal Assent. However, much of the really important detail is yet to be confirmed, including when the different provisions will come into effect. There will also be various consultation exercises (to which you can contribute) before Codes of Practice are drawn up & finalised.

For now, here are a few of the things we either know for sure or are pretty confident about, and some thoughts about what you can do now to get ready for the changes.

Day one unfair dismissal

This is one of the provisions that has most worried employers. It is almost certain to remain, in spite of various proposed amendments by the Lords. Current thinking is that it is unlikely to come into effect before Autumn 2027, so there is time to prepare!

We do know that there is going to be an ‘initial period of employment’ (IPE) during which an employee may be dismissed using a ‘light touch process’. We don’t know exactly how long this IPE will be; the expectation is it will be nine months, although it may be as short as six. The light touch process is also yet to be defined, but it’s likely to involve a meeting where the employer must provide reasons for the dismissal.

Important points to note:

An employee will still be able to bring a claim for unfair dismissal during the IPE
Six to nine months can pass very quickly – plenty of employers run out of time on the current two years…!
You will need a well-structured process to monitor new employees.
Start preparing for this now – it’s good practice anyway.
Review your induction processes and probationary reviews.
We would suggest a six month probationary period for all new employees
Build in at least one formal review before the end of probation – at three months can work well
If there are any concerns, document them along with the improvements you require and detail any support or extra training you will provide.
Schedule reviews – possibly monthly
If you have any doubts about someone’s suitability, do not sign off their probation – extend it by three months and document as above
Be very aware of any potential for discrimination (already no qualifying period for bringing a claim) and be ready to make reasonable adjustments if someone has a disability, which can include mental health issues and neurodivergent conditions.
Be brave! If someone is not right for your business then you need to act.
It’s never risk-free, but you have to consider what it costs you, in time, salary, lost productivity and negative impact on morale, to keep an unsuitable employee.

SSP

Changes are expected to come into force in April 2026, but this is to be confirmed.

Employees will become eligible for SSP from the first day of sickness absence, rather than having the current three ‘waiting days’

The lower earnings limit is also to be removed – those earning below the limit will receive a percentage of the standard SSP rate rather than the full amount

What does this mean for employers?

Inevitably it will increase the costs to employers as more employees become eligible for SSP and for shorter periods of absence

Employee contracts and handbooks may need revising to reflect the changes (if you’re a retainer client with Eight Legal we will, of course, have you covered!)

Family Friendly Rights

Paternity Leave is expected to become a day one right from April 2026
There will still be a qualifying period for eligibility for statutory paternity pay
It is also likely that it will become a day one right for employees to take unpaid parental leave (currently a 26 week qualifying period).
Other rules around parental leave are expected to be unchanged
The introduction of statutory bereavement leave and the changes to the flexible working requests regime are likely to be delayed until 2027, but we’ll keep you updated

Ban on fire and rehire

This has been subject to numerous amendments by the Lords and the provisions are likely to be somewhat softened.

Instead of a near-total ban on fire & rehire (unless the business was facing ‘imminent financial collapse’), the current draft still has strong restrictions but also some areas where a dismissal for refusing to accept a change of terms is potentially fair.

It will remain automatically unfair to dismiss an employee for refusing to accept a change of terms on:

Pay
Number of working hours
Reduction in holiday entitlement
Changes to hours or timing of shifts
Changes to pensions

This means it would be impossible to force through a change in working hours, for example, and it’s not clear to what extent employers will be able to rely on general variation clauses in contracts.

Where shift patterns may change, it’s sensible to include a contractual clause stating that the rota is subject to change to meet the needs of the business

Examples of where it may potentially be fair to dismiss an employee for failing to accept revised T&Cs include changes to:

Place of work (eg on site v WFH)
Job title or duties
Notice periods

Other changes:

The protective award for failure to properly consult on collective redundancies is to be increased from 90 to 180 days’ pay – likely April 2026
Repeal of the previous Governments TU and industrial action reforms will automatically come into force two months after the Bill receives royal assent
The duty to take ‘all reasonable steps’ to prevent sexual harassment, meaning an employee could have a direct claim against an employer for failure to do so, is expected to come into force from October 2026.
The increase in the time limit for employees to bring tribunal claims is set to increase from three to six months. This was expected to come into force from October 2026, but, against the background of long tribunal delays, may be pushed back.
The right for zero hours workers to request guaranteed hours looks likely to be pushed back beyond the end of this Parliamentary term.

In summary:

The bill is in its final stages and will pass
The devil is in the detail, and much of this is yet to come
The real obligations on employers will be set following consultations and Codes of Practice being drafted
Some of these changes have very practical implications for employers – there is time now to plan and prepare.
Consider whether you need to update management processes and your policies

Please note – the information in this article is for guidance only and is not a substitute for specific legal advice.

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