Employment Rights Act tracker

The Government has announced that the Bill will shorten the current two-year qualifying period of employment for unfair dismissal claims to six months. The Government previously proposed to remove the two-year qualifying period subject to a limited exception but announced this concession of shortening the qualifying period in the face of pressure from business and the House of Lords.

The aim behind this change is to strengthen employment rights, and extend employee protections against unfair dismissal.

The Bill provides that collective redundancy obligations will be triggered where: (i) 20 or more redundancies are proposed at one establishment (which is the case under the existing law); or (ii) a threshold number of employees are proposed to be made redundant across the employer’s business. The threshold number is to be set out in regulations but may be a specified number (e.g. 100) or a specified percentage (e.g. 10%) of employees of the business. The Bill does not remove the ‘at one establishment’ test. 

The aim with this change is to strengthen collective redundancy rights and protections by ensuring the right to consultation is determined by the number of people impacted across the business, as well as proposed redundancies taking place at one establishment. 

The Bill provides that employers will not be required to consult all appropriate representatives together, nor to consult with a view to reaching the same agreement with all representatives.

This addresses a concern that by removing the ‘at one establishment’ test (or indeed introducing the new threshold trigger), employers would be required to consult with disparate groups of employee representatives about unrelated redundancy situations.

Following the Government’s response to its consultation on strengthening remedies against abuse of rules on collective redundancy and fire and rehire, the Bill will double the maximum protective award available for failing to comply with collective consultation requirements from 90 to 180 days’ actual pay. The Bill does not make interim relief available to those who bring protective award claims for a breach of collective consultation obligations.

Following the Government’s response to its consultation on strengthening remedies against abuse of rules on collective redundancy and fire and rehire, the Bill will introduce a new category of automatic unfair dismissal where the reason for their dismissal is either that (i) the employer sought to vary the employee’s employment contract to make a ‘restricted variation’ and the employee did not agree to that variation, or (ii) the employer sought to make more than one variation and the employee did not agree to several variations that included the restricted variation. A limited exception will apply where an employer can show that the reason for the variation was to address financial difficulties and that it could not reasonably have avoided the need to make the variation.  A ‘restricted variation’ will include a reduction in pay, variations of any term or condition relating to pensions, changes to hours, shift changes, changes to time off, and other changes to be specified in regulations. It also covers the inclusion in an employment contract of a contractual term enabling any restricted variation without the employee’s consent. 

This change aims to deliver on the Government’s commitment to “end unscrupulous fire and rehire tactics”.

Following the Government’s response to its consultation on strengthening remedies against abuse of rules on collective redundancy and fire and rehire, the Bill will increase the maximum protective award for failing to comply with collective consultation obligations in the context of dismissal and re-engagement processes from 90 to 180 days’ actual pay. The Bill does not make interim relief available to those who bring protective award claims for a breach of collective consultation obligations.

The aim behind this change is to ensure that employers will not be able to deliberately ignore their collective consultation obligations, and it should never be financially beneficial for them to do so. Employment tribunals will continue to have discretion to determine an award that they consider to be just and equitable in all the circumstances having regard to the seriousness of the employer’s default and any mitigating factors. 

The Bill will introduce a new duty on employers to offer guaranteed hours to eligible workers reflecting the hours they regularly work over a reference period, which will be specified in regulations but is expected to be 12 weeks. A worker will be able to reject an offer of guaranteed hours and stay on a zero hours or low hours contract. An offer will need to be made at the end of every reference period while the worker remains eligible.

Those eligible for this right will include workers on zero hours and 'low hours' contracts (with low hours contracts to be defined in regulations following consultation, although expected to be more than two hours).

The Bill allows for this right to be disapplied under the terms of a collective agreement (known as “contracting out”).  

This change reflects the Government’s commitment to ending one-sided flexibility and exploitative zero hours contracts, although does not go as far as banning zero hours contracts. 

The Bill will introduce a right for eligible workers to be given reasonable notice of a shift, including the start and end time, date and number of hours to be worked, that the employer requests or requires them to work. 

The aim is to make it easier for workers to organise transport and childcare, and to meet other family commitments and caring responsibilities. It is expected that the change will encourage employers to plan ahead more, so that workers do not bear so much of the financial risk. 

The Bill will require employers to compensate workers if their shift is cancelled, moved or curtailed at 'short notice' (with short notice to be defined in regulations following consultation). Certain types of shift will be excluded from this right, the details of which will also be set out in regulations.

The aim behind this change is to encourage employers to plan ahead more, so that workers do not bear so much of the financial risk.   

Following the Government’s response to its consultation on the application of zero hours contracts measures to agency workers, the Bill was amended to extend the zero hours contracts measures to agency workers. It will be the responsibility of the end hirer to make any guaranteed hours offer. Liability for other aspects of the application of zero hours contract measures to agency workers will vary between the agency and/or the end hirer as discussed in this Law-Now.

The Bill introduces a duty requirement for employers to take reasonable steps to ensure that workers are given specified information about their rights to guaranteed hours during an 'initial information period'. The information to be provided will be set out in regulations, and the information must be provided to any worker who it is reasonable to consider could potentially be a qualifying worker in any reference period.

The Bill will introduce a new category of automatic unfair dismissal relating to guaranteed hours. This will render it automatically unfair to dismiss an employee if the reason (or principal reason) for the dismissal is one of a number of specified reasons including that (i) the employee accepted or rejected a guaranteed hours offer, (ii) the employer believes that the employee is entitled to a guaranteed hours offer, and (iii) the employee (acting in good faith) brought proceedings under the zero hours provisions or made an allegation of a breach of those provisions. There will be no qualifying period of employment to bring this type of automatic unfair dismissal claim. 

Workers will have protection against any detriment by their employer on a number of specific grounds including that (i) they accepted or rejected (or proposed to accept or reject) a guaranteed hours offer, and (ii) brought proceedings against their employer in relation to failures relating to the right to guaranteed hours, or alleged the existence of any circumstances which would constitute a ground for bringing any such proceedings.

The Bill will introduce a right to a statement of trade union rights to be given at the same time as the statement of employment particulars required by section 1 of the Employment Rights Act 1996 and “at other prescribed times”. Regulations will determine what information must be included in the statement, the form it must take and the frequency and manner of the communication.

Failure to provide a statement will result in an uplift of between two to four weeks’ pay where another successful substantive claim (such as unfair dismissal and/or discrimination) is brought.

The change is part of the Government’s objective to empower workers by ensuring they are fully informed of their rights.

The Bill will introduce a new right of trade unions to access workplaces. The right will apply to any ‘qualifying trade union’ which is a trade union that has a certificate of independence. The Bill makes clear that access means physical entry into a workplace and communication with workers. The access purposes will be to meet, support, represent, recruit or organise workers and to facilitate collective bargaining. Organising industrial action is expressly excluded. 

The Bill provides that the right will be contingent on a qualifying trade union and employer entering into an “access agreement” which sets out the terms on which a union will have access and may be varied by the parties in writing at any time. 

The Bill provides for recourse to the Central Arbitration Committee (CAC) in circumstances where either an employer fails to respond to a trade union’s access request or where an employer and trade union fail to agree access terms. The CAC will be able to determine whether or not officials of the union are to have access, taking account of the “access principles” which include ensuring that an employer should take reasonable steps to facilitate access and physical entry to a workplace should not be refused solely on the basis that communication with workers by means not involving physical entry is permitted. 

The aim behind this new right is to broaden the scope for collective bargaining and for trade unions to exercise their functions of negotiation and dispute resolution. It would also give unrecognised trade unions a better opportunity to gain recognition. 

The Bill will simplify the existing statutory trade union recognition process by:

(a) replacing the existing support threshold for the CAC to accept an application for recognition with a threshold of anywhere between 2% and 10%;

(b) removing the requirement for a trade union to demonstrate on application to the CAC that there is likely to be majority support for trade union recognition; and

(c) removing the 40% support threshold from recognition ballots so that only a majority of those voting will be required.

The aim behind this simplification is to give workers a meaningful right to organise through trade unions.

The Bill will ensure that following the submission of a recognition application to the CAC, new recruits are not considered by the CAC for the purposes of the recognition process or entitled to vote in a recognition ballot. The aim here is to prevent mass recruitment into a bargaining unit in order to dilute union membership and block recognition.

The Bill will require employers to provide trade union officials and learning representatives, where permitted to take time off to carry out trade union duties and training, with reasonable access to facilities (for example, meeting rooms and internet access), having regard to any relevant provisions of an Acas Code of Practice, for those purposes. We can therefore expect to see a new Acas Code of Practice relating to facilities and/or updates to its existing Code of Practice on time off for trade union duties and activities in due course.

The Bill will also provide that where an employee complains about not having been permitted to take time off for trade union duties, it will be for the employer to show that the amount of time off requested was unreasonable. 

The Bill will require employers to permit union equality representatives to take paid time off during working hours for various purposes including carrying out activities for the purpose of promoting the value of equality in the workplace and arranging learning or training on matters relating to equality in the workplace. Where a union equality representative is permitted to take time off for any of these specified purposes, the employer must provide them with reasonable access to facilities (for example, meeting rooms and internet access) where requested by the employee, having regard to any relevant provisions of an Acas Code of Practice. 

The Bill will broaden the scope of the blacklisting legislation to protect a wider range of people and to prohibit third parties from compiling blacklists not just employers and employment agencies. The Bill also enables the Secretary of State to make regulations prohibiting the use of lists which contain details of trade union members or those who have taken part in trade union activities for the purposes of discrimination in relation to recruitment or in relation to the treatment of workers. The Government also intends to use secondary legislation to extend the prohibition on blacklists prepared for the purposes of discrimination to lists not prepared for those purposes (e.g. lists complied using AI) but subsequently used in that way. 

The aim is to update and broaden the scope of the blacklisting legislation to provider greater protection against blacklisting due to trade union membership or activity.

The Bill will remove the requirement for at least 50% of those who were entitled to vote in the ballot before industrial action to have done so (the “turnout threshold”).  

The Bill will also remove the requirement in important public services for at least 40% of those who were entitled to vote in the ballot to have voted in favour of industrial (the “support threshold”) to a majority of those actually voting. 

The Bill also simplifies the existing information requirements in relation to industrial action ballots and industrial action notices, by removing the requirement for trade unions to provide employers with specified information including in relation to ballots, the number of employees in each of the categories of worker being balloted and the number of workers concerned at each workplace and in relation to notices of industrial action the number of affected workers in each category that is expected to take part in the action.

The stated aim behind this change is to reduce the scope for spurious legal challenges based on minor technicalities against industrial action that has the democratic support of the workplace.

The Bill shortens the period of notice a trade union is required to give an employer of industrial action from 14 days to 10 days.

The Bill also extends the mandate for industrial action  following a successful ballot for industrial action from six months (with the opportunity to extend this to nine months by agreement) to twelve months (without the possibility of extension).

The Bill provides that a worker has the right not to be subjected to any detriment by their employer where the sole or main purpose is to prevent  or deter the worker from taking protected industrial action or penalising the worker for doing so.

The Bill removes the 12-week limit on bringing an unfair dismissal claim where the reason, or principal reason, for the dismissal is that the employee took part in official industrial action. This means employees will be protected against unfair dismissal when taking protected strike action regardless of the length of the strike action.

The Bill will repeal the minimum service levels legislation introduced under the previous Government which mandated minimum staffing levels in key sectors such as health, fire rescue, education and transport during strike action.

The Bill will introduce a day one right to paternity and parental leave by removing the existing qualifying service requirements which are 26 weeks and one year respectively.

The Bill will also remove the restriction on taking paternity leave after a period of shared parental leave.

The Bill will extend the existing right for parents to take bereavement leave after the loss of a child so that it applies to the loss of a wider group of people who will have a day one right to take at least one week’s leave. Regulations will specify the relationships with a person who has died that qualify for bereavement leave and ensure that where an employee is eligible for leave as the result of the death of more than one person, they are entitled to leave in respect of each person. An amendment to the Bill ahead of the Lords Report Stage extended the right to those who suffer pregnancy loss before 24 weeks of pregnancy. 

The Bill will provide protection against related detriment and dismissal for those taking bereavement leave.

Pregnant women and new mothers have enhanced protection against redundancy dismissals with the right to be offered any suitable alternative roles available ahead of other at risk employees. The Bill will give the Secretary of State the power to make regulations about protection against dismissal (for any reason, not just redundancy) for women during or after a protected period of pregnancy. The Bill also allows for the extension of those enhanced dismissal protections after a period of leave to other types of statutory family leave such as adoption leave and shared parental leave.

The Government has committed to consulting on the detail of these changes before finalising the approach. 

The Bill will strengthen the duty to prevent sexual harassment at work by requiring employers to take “all reasonable steps” to prevent sexual harassment. This mirrors the “all reasonable steps” defence against an employer’s vicarious liability for an employee’s discriminatory act which the Government considers has the advantage of being well-established and familiar to employers and employment tribunals.

The Bill provides that regulations may be made specifying steps that an employer must take and matters to which they must have regard in order to meet the enhanced preventative duty. The regulations may prescribe steps that are to be regarded as reasonable for the purpose of determining whether an employer has complied with the duty, such as carrying out assessments of a specified description and steps relating to the handling of complaints.

The aim is to ensure that specific steps are taken by employers where empirical evidence demonstrates that they are needed in order to prevent sexual harassment at work. 

The Bill will reintroduce employer liability for third party harassment in relation to all relevant protected characteristics. A worker will be able to bring a claim against their employer if a third party (such as a customer or supplier) harasses them in the course of their employment and the employer has failed to take all reasonable steps to prevent the third party from doing so. 

The aim is to ensure that those who are subjected to workplace harassment by third parties have recourse to legal redress if their employer has not taken all reasonable steps to protect them from it.   

Sexual harassment will become a new category of protected disclosure under the statutory whistleblowing regime. An employee who makes a protected disclosure relating to sexual harassment will be protected from detriment and dismissal where the reason (or principal reason) for it is their protected disclosure.

The aim is to encourage workers to speak up about sexual harassment using whistleblower reporting channels, and to make clear to employers that workers who make protected disclosures about sexual harassment must be treated fairly. 

The Bill will render confidentiality clauses void where they prevent a worker from making an allegation or disclosing information relating to (a) workplace harassment or discrimination, or (b) their employer’s response to workplace harassment or discrimination or the making of an allegation or disclosure about workplace harassment or discrimination. The prohibition would apply to discrimination and harassment by a worker’s employer and by their colleagues and be broad enough to cover settlement agreements and contracts of employment. Confidentiality clauses in an ‘excepted agreement’ – the details of which will be specified in regulations – would be excluded.  

Employers with 250 or more employees will be required under future regulations to develop and publish an equality action plan on steps they are taking to (i) address the gender pay gap and (ii) support employees going through the menopause. The regulations may make provision about how frequently the plan should be updated and the form and manner in which the plan must be published.

The Government’s Next Steps to Make Work Pay policy paper, published in October 2024, indicated that consultation on a draft Equality (Race and Disability) Bill would begin “in due course” with a draft bill being published during the then current parliamentary session which ended in July 2025. The draft Bill is still awaited.

In March 2025, the Government launched a consultation on mandatory ethnicity and disability pay gap reporting seeking views on the related measures it proposes to include in the Equality (Race and Disability) Bill. The proposals are similar to the gender pay gap reporting regime, requiring large employers (those with 250 or more employees) to report the difference in mean and median hourly pay and bonus and quartiles information for employees in the respective groups. The consultation closed on 10 June 2025. For further information, see our Law-Now Government launches consultation on mandatory ethnicity and disability pay gap reporting for employers. 

In April 2025, the Government issued a Call for Evidence – Equality Law, seeking evidence and views on equality policy areas including the prevalence of pay discrimination on the basis of race and disability, making the right to equal pay effective for ethnic minority and disabled people, and strengthening protections against combined discrimination. The call for evidence was open for 12 weeks and closed on 30 June. For further information, see our Law-Now.

The Bill will strengthen the right to request flexible working by providing that a request may only be refused where one or more of the statutory grounds for refusal (e.g. the burden of additional costs and planned structural changes) apply and it is reasonable for the employer to refuse the request on that ground or grounds. 

The Bill will also require an employer, before rejecting a request, to follow a consultation process to be specified in regulations and explain to the employee why their decision is reasonable.

The aim behind these changes is to support access to flexible working, ensuring that employers accept reasonable and feasible requests. 

The Bill will remove the current three-day waiting period for SSP which will mean that an employee is eligible to be paid from the first day of sickness absence.

The aim behind the changes in relation to SSP is to support all employees to take the time off they need to recover by providing better financial security, while also limiting the costs to businesses and reducing the spread of infection diseases.

The Bill will remove the lower earnings limit (currently £125 per week) as a condition of eligibility for SSP. A new rate of SSP set at 80% of average weekly earnings or the flat rate (currently £118.75) whichever is lower will be introduced.

The rate was set at 80% following the Government’s response to its consultation on strengthening statutory sick pay which sought views on what the percentage rate should be for those earning up to the flat rate of SSP.

The Bill provides for the regulation of umbrella companies by expanding the legal definition of “employment business” within the existing legal and regulatory framework for employment businesses and employment agencies to include umbrella companies. This follows the Government’s response to the previous Government’s consultation on  tackling non-compliance in the umbrella company market, and aims to ensure that workers engaged by umbrella companies enjoy the same rights and protections as those engaged by employment businesses.

Employers will be required to keep records of compliance with holiday entitlement and holiday pay for six years. Employers will have flexibility as to the way in which those records are kept and maintained.

The Bill will increase the time limit for bringing most employment related claims from three months to six months.

The aim behind this change is to reduce pressure on the employment tribunal system, by allowing parties more time to try to resolve their differences before resorting to formal litigation.

Under the Bill, the Fair Work Agency (FWA) will bring together existing state enforcement functions and take on enforcement of a wider range of employment rights.

The Bill gives the FWA powers to investigate and take action against businesses that do not comply with employment law. These will include powers to inspect workplaces and require employers to produce relevant documents and evidence to demonstrate compliance, issue notices of underpayment to employers who have underpaid their workers, and to bring proceedings in the employment tribunal on a worker’s behalf.

The aim is to improve the current system of state enforcement which the Government considers to be fragmented and inefficient, and to provide for strong enforcement powers in respect of a wider range of employment rights (including holiday pay and statutory sick pay) so that action can be taken in relation to breaches and to level the playing field for compliant businesses.

The Bill will reinstate and strengthen the Code of Practice on Workforce Matters in Public Sector Service Contracts (known as the ‘two-tier Code’) through Regulations and a statutory code of practice (yet to be published). The two-tier Code will apply to procurements where transferred public sector and private sector employees will be working together to deliver an outsourced public sector services contract. It empowers an appropriate authority (which includes a Minister of the Crown and the Scottish Ministers) to specify a contractual provision to be included in public sector services contracts to ensure that private sector workers are treated no less favourably than public sector workers (and vice versa) in that situation. The contracting authority will then be required to take all reasonable steps to ensure (i) that that provision is included in the contract, and (ii) where it is included, that it is complied with.

The aim is to prevent the emergence of a two-tier workforce where private sector employees working on an outsourced public sector services contract have worse terms and conditions than those working on it from the public sector by reinstating the two-tier Code which applied between 2005 and 2010 when it was withdrawn.