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The Employment Rights Act 2025 the ‘Act’, introduces significant changes that businesses need to be aware of. The Act received Royal Assent on 18 December 2025 and makes amendments to existing legislation. Some changes which have not yet come into effect remain subject to Government consultation.
What has already changed
Minimum service level rules
On 18 December 2025, rules regarding keeping services running when there’s a strike were removed. The removal means that employers in essential services are no longer able to issue work notices which would require specific staff to work during strikes to maintain minimum services levels.
Dismissal protection for industrial action
From 18 February 2026, dismissal for taking part in industrial action became automatically unfair.
The Act removes the protected period (12 weeks) for employees from unfair dismissal for taking part in protected industrial action, meaning that the protection applies irrespective of the length of the industrial action.
Trade union changes
From 18 February 2026:
- the time needed to give notice of industrial action reduced to 10 days, previously it was 14 days.
- picket supervisors no longer required.
- industrial action mandates last for 12 months, instead of 6 months.
- industrial action and ballot notices simplified.
- Unions need a majority vote for industrial action – previously there was a 40% threshold for certain important public services.
- Members who join a trade union on or after 18 February 2026, are automatically opted in to the trade unions political fund (if it has one), unless they expressly opt out by providing an opt-out notice.
Paternity leave and ordinary parental leave
From 6 April 2026:
- Eligible employees will have the right to take unpaid parental and/ or paternity leave from day one of their employment as the requirement for qualifying service is to be removed. Previously an employee must have been continuously employed for at least 26 weeks up to the end of any day in the ‘qualifying week’.
- The restriction on taking paternity leave following shared parental leave has been removed.
- Eligible fathers and partners are able to take up to 52 weeks of unpaid bereaved partner’s paternity leave if the mother or primary adopter dies
Sick pay
From 6 April 2026:
- statutory sick pay (SSP) is paid from the first day of illness, instead of the fourth day
- the lower earnings limit has been removed so employees who earn less than £125 per week will now be eligible for SSP. The amount of SSP will now be which ever is the lower of either 80% of the employees average weekly earnings or the current SSP rate.
Collective redundancy protective award
From 6 April 2026, the maximum protective award for failure to consult in collective redundancy is 180 days’ pay, instead of 90 days’ pay.
Whistleblowing protections for sexual harassment
From 6 April 2026, sexual harassment became a ‘qualifying disclosure under whistleblowing law. This means employees cannot be treated unfairly or be dismissed because they have raised concerns regarding sexual harassment.
Gender pay gap and menopause action plans
From 6 April 2026, employers of all sizes can voluntarily publish action plans around menopause and gender pay gaps. In 2027, this will become mandatory for employers with 250 or more workers.
Trade union recognition
From 6 April 2026, how a trade union can be recognised in a workplace has been simplified.
- Acceptance of TU recognition applications currently have a 10% threshold, which is being replaced with a test of anywhere between 2% and 10%;
- Removal of the obligation for a trade union to demonstrate that there is likely to be majority support for trade union recognition; and
- Removal of the 40% support threshold from recognition ballots. Instead, only a simple majority of those voting will be needed.
Holiday records
From 06 April 2026, there is a new requirement for employers to maintain records demonstrating their compliance with holiday entitlement, including details of leave taken and pay.
Importantly these records must be retained for six years. The Fair Work Agency will have the power to investigate, enforce and impose penalties against non-compliance and will be able to look back retrospectively at annual leave records from December 2025, so it is important to retain appropriate records from that point onwards, if not already doing so. Employers should also ensure any relevant Data Protection or retention policies allow for the records to be kept for this period of time.
Fair Work Agency
The Fair Work Agency was established on 07 April 2026 and will be responsible for bring together existing enforcement bodies and taking on enforcement of other employment rights, such as national minimum wage, holiday pay and statutory sick pay.
What changes are scheduled?
August 2026
From 25 August 2026, trade union ballots may allow electronic and in-person voting and the process of removing the current 50% turnout requirement for industrial action ballots will begin.
October 2026
From 01 October 2026, employment tribunal time limits will change, with the deadline for claimants to bring employment claims increasing from three months to six months.
From 30 October 2026;
Employers will become liable for third-party harassment unless they can demonstrate they took all reasonable steps to prevent it. At the same time, stronger duties will be imposed on employers to prevent sexual harassment in the workplace.
- New trade union rights; including, workplace access, the duty to inform workers of the right to join a trade union, enhanced rights and protections for trade union representatives, extension of protections against detriments for taking industrial action, implementation of reforms to access and unfair practices during the recognition and derecognition process, and all remaining trade union recognition measures, including freezing the bargaining unit when an application is received.
Other measures that will be introduced in October 2026;
- Regulations to establish the Fair Pay Agreement Adult Social Care Negotiating Body in England.
- Procurement – reinstating the two-tier code to ensure outsourced private sector employees are offered no less favourable terms and conditions to employees transferred from the public sector.
December 2026
The introduction of Seafarer Protection Regulations.
Measures that will take effect by the end of 2026
Changes to tipping policies and employer obligations – the Employment (Allocation of Tips) Act 2023 requires employers to have a tipping policy in place for all qualifying tips. The Act now provides that employers must first consult employees or their trade union representatives about the policy on behalf of any affected workers. Employers will also be required to review their tipping policy once every 3 years.
01 January 2027
From 01 January 2027, protection from unfair dismissal will become a right after six months’ service and the limit on the compensatory award for unfair dismissal will be removed.
Also from 01 January 2027, dismissing an employee and then rehiring them on worse terms and conditions will become automatically unfair dismissal in most circumstances.
Further changes expected during 2027
Subject to the Governments consultations, further employment law changes are anticipated throughout 2027.
These include:
- Stronger protections for pregnant employees and those returning from maternity leave.
- A new right to unpaid bereavement leave including pregnancy loss.
- Guaranteed hours rights for zero hours and low hours workers.
- Compensation for cancelled or shortened shifts.
- A requirement for employers to provide reasonable notice of shifts.
- A requirement for employers to provide clear justification for flexible working refusals.
- Non-disclosure agreements (NDAs) that prevent the disclosure of harassment or discrimination will become unenforceable.
- Mandatory gender pay gap action plans and menopause action plans for larger employers.
- Expanded collective redundancy protections.
- Additional trade union reforms.
Need advice on how the Employment Rights Act 2025 affects your business? Our employment law team can help you understand the changes and ensure your policies and procedures remain compliant. Contact Backhouse Jones for specialist employment law advice by phoning 01254 828 300 or emailing enquiries@backhouses.co.uk.
This article was written by Gabrielle Scriven.