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The Employment Rights Act 2025 is one of the most significant overhaul of UK employment law in a generation. Originally introduced as the Employment Rights Bill, it received Royal Assent in 2025. Reforms are now rolling out in phases from April 2026 through to 2027, giving employers a narrow window to review contracts, update policies and train managers before each obligation comes into force.

This blog covers everything UK employers need to know, including: 

• What the Act includes.
• The key employment rights act changes.
• When key changes take effect.
• The practical steps UK businesses should take right now.

Employment Rights Act 2025: What it means for employers

The Act covers a broad range of employment areas, from statutory sick pay and parental leave through to collective redundancy, whistleblowing, sexual harassment and zero-hours contracts. To give businesses time to adapt, the government has opted for a staggered rollout rather than implementing everything in one go. 

Here’s the employment rights act summary at a glance:

Date	Employment law changes
In effect from 6th April 2026	Statutory Sick Pay (SSP) from day one.
	Day-one paternity and parental leave rights.
	Doubled collective redundancy penalties.
	Fair Work Agency launch.
	Whistleblowing protection for sexual harassment complaints.
October 2026	Stronger duty to prevent sexual harassment.
	Tribunal time limit extended to six months.
January 2027	Unfair dismissal qualifying period drops to six months.
	Compensation cap removed.
	Fire-and-rehire ban.
2027	Zero-hours contract reforms.
	Flexible working changes.
	NDA restrictions.
	Equality action plans.

For a full breakdown of every date and reform, see our Employment Rights Act 2025 implementation timeline.

Preparing your policies and contracts for employment law changes

With many of the Employment Rights Act changes already in effect and more on the horizon, UK businesses need to start preparing their policies and contracts for the changes. 

But before you can do this, you need a clear picture of where your employment documentation stands today. A few things business owners and HR professionals can do to prepare include:

• Audit existing contracts and policies. Go through your template contracts, offer letters and staff handbook. Check whether they reflect current statutory rights, particularly around leave entitlements. Many of the April 2026 changes will have taken effect automatically, but your written documentation should match what employees are now entitled to.
• Update your employee handbook. You’ll need to revise sections covering paternity leave, parental leave, sick pay and grievance procedures as a minimum. If you have a zero-hours section, flag it as under review pending 2027 regulations.
• Plan manager training. A compliant policy on paper counts for little if managers don’t know how to apply it. For unfair dismissal, flexible working and harassment, managers are the frontline. Build a training schedule now rather than scrambling once a deadline passes.

91±¬ÁÏ’s HR software lets you store, update and distribute policy documents centrally, so your whole team is working from the same version at all times.

Parental leave and paternity leave: day-one rights from April 2026

One of the changes that has already taken effect in 2026 is the shift to day-one rights for unpaid parental leave and paternity leave.

Before April 2026, employees needed 26 weeks of continuous service to qualify for unpaid parental leave and at least 26 weeks’ service by the 15th week before a baby’s due date to qualify for statutory paternity leave. Both of those service requirements have been removed.

What this means in practice:

• An employee who starts a new role and becomes a parent shortly afterwards can take unpaid parental leave from the outset.
• Paternity leave can now be taken before or after shared parental leave, removing the previous restriction that required it to come first.
• The Act also includes provisions for bereaved partners, extending leave rights in circumstances of pregnancy loss.

Actions to take now:

1. Remove service thresholds from your parental and paternity leave policies.
2. Update HR system settings so day-one entitlement is reflected in your leave management process.
3. Brief managers on how to handle requests from newer employees, particularly where bereavement is involved.

Whistleblowing protections and sexual harassment

Since 6th April 2026, a complaint of sexual harassment at work is a qualifying protected disclosure under whistleblowing legislation. From October 2026, the existing duty to take “reasonable steps” to prevent sexual harassment increases to a duty to take “all reasonable steps.”

Third-party harassment protection (harassment by clients, contractors or customers) also comes into force in October 2026.

Why this matters for employers:

If an employee raises a sexual harassment complaint and is then dismissed or treated unfairly, they’ll have a whistleblowing claim in addition to any discrimination claim. Whistleblowing claims carry the right to interim relief, meaning a tribunal can order reinstatement or continuation of employment while a case is ongoing. That fundamentally changes the cost of getting it wrong.

Actions to take now:

1. Update your whistleblowing policy to explicitly include sexual harassment disclosures as qualifying protected disclosures.
2. Review your anti-harassment policy and plan what “all reasonable steps” looks like in your specific workplace.
3. Train managers on what constitutes a qualifying disclosure and how to respond without creating detriment or dismissal risk.
4. Document the steps you’ve already taken to prevent harassment; you’ll need to evidence this if a claim arises.

Collective redundancy obligations and the protective award

The Employment Rights Act doubles the maximum protective award for collective redundancy failures. The previous cap was 90 days’ gross pay. Under the Act, that has risen to 180 days.

Actions to take now:

1. Map roles and departments where redundancy risk exists. Understand at what headcount the collective consultation obligations kick in for your business.
2. Build a consultation timetable that meets the 45-day minimum for 100+ redundancies or 30 days for 20–99.
3. Establish a clear employee representative election process in advance, so you’re not starting from scratch under pressure.
4. Model your worst-case financial exposure. At 180 days’ pay, even a small group of affected employees represents significant liability.

Non-disclosure agreements and harassment clauses

NDA restrictions don’t take effect until 2027, but UK businesses should start reviewing settlement agreements now. Many are drafted with broad confidentiality clauses that may no longer hold.

Under the Act, NDAs cannot prevent employees from disclosing allegations of discrimination or harassment. Confidentiality provisions remain permissible, but only within defined limits. An NDA that attempts to stop an employee discussing a harassment complaint will not be enforceable.

Actions to take now:

1. Review your standard settlement agreement template and remove or redraft clauses that attempt to prevent harassment or discrimination disclosures.
2. Insert properly scoped confidentiality provisions that comply with what the Act will permit.
3. Take legal advice if you have historical agreements with overbroad NDA clauses that could be challenged.

Shift rights, zero-hours contracts and guaranteed hours

The zero-hours contract reforms are among the most operationally complex changes in the Act. They don’t bite until 2027, but any business that relies on flexible or variable-hours workers should be planning now.

The key changes coming in 2027:

• Guaranteed-hours offers: Workers who regularly work a consistent number of hours will be entitled to a contract reflecting those hours.
• Reasonable notice for shift changes: Employers must give reasonable notice before changing or cancelling a shift.
• Compensation for cancelled shifts: Workers will have a right to payment when shifts are cancelled without adequate notice.

Actions to take now:

1. Review how you use zero-hours contracts. Are there workers whose patterns are consistently regular? They may qualify for guaranteed-hours offers under the new rules.
2. Set reasonable notice standards now as policy, ahead of the legal requirement; it reduces risk and improves employee relations.
3. Update zero-hours contract templates to include shift change and cancellation provisions.
4. Establish a process for calculating and paying any required compensation.

Keeping payroll accurate when hours fluctuate is already complex. 91±¬ÁÏ’s payroll compliance software handles scenario-specific pay calculations automatically, including variable hours and shift-based scenarios, so the administrative burden stays manageable as these rules come into force.

Tribunal time limits extend to six months (October 2026)

From October 2026, the time limit for bringing most employment tribunal claims extends from three months to six months.

For UK businesses, the practical implication is clear: the evidence preservation window doubles. HR documentation, investigation records, emails and meeting notes need to be retained for longer and with greater care.

Actions to take now:

1. Review your document retention policy to account for the extended time limit.
2. Train HR to preserve evidence immediately after any disciplinary, dismissal or grievance outcome, not only once a claim appears imminent.
3. Ensure investigation records are thorough and date-stamped from the outset.

Fair Work Agency and enforcement (April 2026)

The Fair Work Agency launched in April 2026, consolidating enforcement of workers’ rights including the National Minimum Wage, holiday pay and statutory sick pay.

The FWA signals a shift toward proactive enforcement activity rather than waiting for individual complaints. Employers should expect more inspection activity and a greater likelihood of formal action for persistent compliance gaps.

Actions to take now:

1. Monitor FWA published guidance as it is released.
2. Conduct a payroll compliance review before enforcement begins in earnest.
3. Ensure workers can access clear information about their rights; the Act specifically includes provisions to improve access to employment rights information.

Unfair dismissal: qualifying period drops to six months (January 2027)

The qualifying period for unfair dismissal drops from two years to six months from January 2027. The current compensation cap (the lower of one year’s pay or £118,223) is also removed, making awards uncapped.

This combination substantially increases dismissal risk in the first year of employment. A poorly handled dismissal of a six-month employee could result in a very significant award.

Actions to take now:

1. Make probationary periods standard for all new starters, with clear performance review points at one, three and five months.
2. Review and tighten your disciplinary and dismissal procedures, particularly for employees approaching the six-month mark.
3. Train managers on performance management and misconduct handling, this is the single most important mitigation step ahead of January 2027.

Practical checklist and implementation roadmap

Use this as a working compliance plan:

Now:

• Check contracts and policies comply with the updates that came into effect in April 2026.
• Update parental and paternity leave policies to remove service thresholds.
• Revise whistleblowing policy to include sexual harassment as a qualifying disclosure.
• Confirm SSP procedures are updated to remove the three waiting days.
•  Schedule manager training on harassment handling and whistleblowing.

April–October 2026:

•  Monitor Fair Work Agency guidance and update compliance processes accordingly.
•  Extend document retention policy to six months ahead of tribunal time limit change.
•  Finalise “all reasonable steps” anti-harassment plan before October.

2026–2027 planning:

•  Review zero-hours contract use and model guaranteed-hours exposure.
•  Revise settlement agreement templates for NDA compliance.
•  Introduce probationary period review process ahead of the six-month unfair dismissal threshold in January 2027.
•  Assign a senior owner for the overall compliance programme and budget for statutory pay increases.

Stay on top of employment law changes with 91±¬ÁÏ

The Employment Rights Act creates a sustained compliance workload across multiple deadlines. But 91±¬ÁÏ is here to support UK businesses through these changes. 

Our integrated AI-powered platform brings HR, payroll and compliance into one place. The HR features centralise employment documentation, automate key HR workflows and make sure your policies are accessible to managers and employees when they need them. The payroll compliance tools handle legislative changes automatically, from SSP day-one obligations through to statutory pay calculations, so your payroll stays accurate as the rules shift. On top of this, our HR advisory team is on hand to support you through the specific changes that affect your business. 

Want to find out more about how 91±¬ÁÏ can support your business?