Exhibitor Press Releases

Much of 2025 was marked by uncertainty for businesses as the employment rights bill slowly progressed through parliament, prompting significant debate and disagreement. Although questions remain, with much still to be resolved through secondary legislation, employers now have far greater clarity on what to expect in the coming year. “It’s time to switch gear and move from speculation to preparation,” says Peter Cheese, chief executive of the CIPD. “Employers and HR professionals need to understand the roadmap for change that the government has set out and when changes will impact how they hire and manage people at work.”

Not all of the Act’s wide-ranging reforms will come into force in 2026. Under the government’s roadmap for implementation, some of the most notable changes, including the six-month qualifying period for unfair dismissal and the right to guaranteed hours for workers, will not be brought in until 2027. 

Despite this, the majority of the reforms, including changes relating to trade union access to businesses, day-one rights to paternity and parental leave, statutory sick pay reform and a ban on fire and rehire, are set to be introduced over the course of 2026, giving businesses much to prepare for.

April 2026

Day-one rights to paternity and parental leave

Workers will be entitled to paternity and parental leave from day one of employment under the Employment Rights Act. Currently, parents only become eligible for paternity leave after 26 weeks of working for their employer and are required to have worked for a year before they are entitled to parental leave. 

Emma O’Connor, partner at workplace law and advisory firm Doyle Clayton, says the change is a positive one for employees, extending rights to parents who are currently unable to take leave. “We should, however, remember that parental leave still remains unpaid and there are still eligibility requirements to qualify for statutory paternity pay,” she adds. 

However, expanding eligibility could bring greater administrative burdens for businesses and require reorganisation of work. “There’s also the challenge of greater discrimination risks and other legal claims if employers don’t get the changes right, or forget other legal rights and obligations during such leave,” O’Connor explains. 

Increased collective redundancy protective award

The maximum protective award for employees is also set to double under changes in the Employment Rights Act. The award will increase from 90 days’ pay to 180 for employers that fail to consult before carrying out a collective redundancy of 20 or more employees within a 90-day period.

Matthew Leake, head of employment and labour relations law at Kennedy’s, says the proposal will significantly increase the risk to companies seeking to make organisational change, particularly on a large scale. “The punitive nature of protective awards, where compensation is not based on loss suffered, will concern a number of employers,” he adds. 

“It will be interesting to see if the greater maximum threshold will be applied more sparingly by employment tribunals and applied only in the most serious, deliberate cases of breach rather than treating it as a starting point.”

Fair Work Agency will be established 

The Fair Work Agency (FWA), which will have powers to enforce workers rights, is expected to be effective from April 2026. The agency will bring together the existing Employment Agency Standards Inspectorate, Gangmasters and Labour Abuse Authority and HMRC’s National Minimum Wage Enforcement Team, and possess new powers to enforce employees’ rights to holiday pay. 

The FWA will be able to take employers to tribunal on a worker’s behalf if they choose not to take action themselves, with any financial award still being made to the worker if the complaint is well founded. 

HMRC has been increasingly proactive when checking businesses are compliant with the national minimum wage, according to Jennifer Smith, partner and head of commercial employment and HR at Forbes Solicitors, and this is expected to continue under the FWA. “This can prove a technically complex area of compliance and may lead to unintentional breaches,” she says. “Up-to-date, accurate record keeping will prove crucial for employers.” 

Padma Tadi-Booth, employment partner at Hill Dickinson, points out that the FWA’s effectiveness will depend on resourcing. “If funding is limited, there is a risk it becomes largely reactive to complaints rather than the proactive regulator it is intended to be,” she explains.

Statutory sick pay reform

The Employment Rights Act will remove the lower earnings limit of £125 per week for employees to become eligible for statutory sick pay (SSP) from April 2026. The rate of SSP will be set at £118.65 or 80 per cent of their weekly salary, whichever is lower. Currently, the rate is at a flat rate regardless of weekly earnings. Additionally, the three-day waiting period will be removed, meaning workers will be paid from day one of illness. 

O’Connor says the changes could support more productive workforces and prevent presenteeism, with those who are unwell more able to take time off and receive some pay rather than struggling through. However, she addes: “We have to remember that SSP is only paid at the statutory rate, or lower depending on the employee’s actual income.” 

This means it may not be sufficient to allow lower-paid workers to take time off for sickness. 

O’Connor advises HR to review sickness absence and management and improve their monitoring of sickness absence ahead of the reforms coming into force. “Are employers using return-to-work interviews and ensuring that self certificates and doctor’s notes are being supplied? If not, then this will need to change,” she says.

Increased whistleblowing protections and ban on NDAs

Sexual harassment is set to become a ‘qualifying disclosure’ under whistleblowing law, meaning workers who report it will be protected from detriment and unfair dismissal.

Employers should update whistleblowing policies to explicitly cover sexual harassment, ensuring that grievance and whistleblowing procedures are “clearly differentiated and aligned”, says Avril England, employment partner at Gateley Legal. 

The prohibition of non-disclosure agreements that aim to restrict an employee from speaking up about harassment or discrimination is also likely to take effect in April 2026. “Employers will also need to review settlement agreement templates, ensuring they don’t unlawfully restrict such disclosures,” adds England.

Rate adjustments and increase to the minimum wage

The national minimum wage for 18 to 20 year olds will increase by 8.5 per cent to £10.85 an hour, while the rate for 16 to 17 year olds and those on apprenticeships will increase by 6 per cent to £8 an hour. Meanwhile, the national living wage for those aged over 21 will increase by 4.1 per cent in April 2026 to £12.71.

The rates of maternity, paternity, adoption, shared parental, parental bereavement and neonatal care pay will also all increase, as well as the SSP rate. 

Extended rights for trade unions 

The Employment Rights Act includes a plethora of reforms to simplify the process for unions to obtain a lawful mandate to carry out industrial action, many of which will take effect from April 2026. These include simplifying the information trade unions need to give employers in ballot notices and ballot voting papers, removing turnout thresholds for voting in a ballot, reducing the notice required for industrial action from 14 to 10 days, increasing the period of effectiveness of a mandate to support industrial action to 12 months and the introduction of electronic balloting systems. 

October 2026

Ban on fire and rehire 

The Employment Rights Act will make it automatically unfair to dismiss an employee for refusing to agree to a ‘restricted variation’ of their employment contract, or to enable the employer to hire another person under a varied contract of employment where one of these is a restricted variation – except in very limited circumstances. 

A restricted variation to a contract could mean a reduction in pay, working hours or annual leave or a change in shift pattern. 

The reforms are likely to be effective in driving more careful planning by employers and discouraging misuse of fire and rehire practices, says Tadi-Booth. “Depending on the type of change, the only defence would be if the business is in financial distress and the employer had no reasonable alternative to making the change,” she explains. 

However, uncertainty remains around how high the bar for financial distress will be set and how narrowly that defence will be interpreted in practice. “Now is the time to review existing contractual arrangements and plan any necessary changes while the current regime remains in place,” Tadi-Booth says. “Early, well-managed consultation and agreed changes will give employers far greater control than waiting until the new framework is in force.”

Increased duty for employers to prevent sexual harassment

From October 2026, employers will have a duty to take ‘all reasonable steps’ to prevent sexual harassment of their employees – an increase in their obligations from the ‘reasonable steps’ requirement of the Worker Protection Act 2023, which came into force last year. 

The Employment Rights Act will also make businesses responsible for protecting workers against harassment by third parties, a measure that was originally removed from the Worker Protection Act during the parliamentary process.

The addition of the word ‘all’ could have “far-reaching implications” for employers, according to Smith. From October 2026, employers will need to demonstrate that they did everything within their power to prevent sexual harassment from occurring. 

Smith says future regulations may be put in place to clearly specify what constitutes ‘all reasonable steps’, which may not be outlined until 2027. “Employers may want to prepare by reviewing the risks of both sexual harassment and third-party harassment and how they are proactively working to prevent such incidents,” she advises. 

More trade union changes

From October 2026, a new requirement will come into force requiring employers to give workers a written statement informing them that they have the right to join a trade union. Workers will also have increased entitlements to use office facilities to support union work and take paid time off for union duties. Unions will be able to request access to workplaces to meet, support, represent, recruit or organise workers and to facilitate collective bargaining. 

Leake says these reforms will likely lead to increases in pay and other terms and conditions of employment subject to collective bargaining, as well as litigation around these new rights. “Employers in traditionally unionised sectors such as transport, manufacturing and public services may find the new landscape easier to adapt to than those in sectors that have previously seen less trade union presence and be less experienced in managing a union relationship,” he adds.

Leake advises employers to take early advice about their new obligations, adapt contracts, policies and procedures accordingly, and learn from peers who have managed trade union recognition successfully.

Tightening tipping law

The Employment Rights Act will require employers to consult with workers or their representative before creating a tipping policy and update it every three years. Businesses will also have to provide all staff with an anonymised summary of the feedback received during the consultation process. 

The Employment (Allocation of Tips) Act, which came into force in October 2025, created a duty for employers to distribute tips in a ‘fair and transparent manner’ and pass on all tips and service charges to workers without deductions.

Tribunal time limits extended to six months 

The Employment Rights Act is also set to extend the time employees have to bring a tribunal claim after their complaint arises to six months from the current limit of three months from October 2026.