The Employment Rights Act: how will it affect my business?

The Employment Rights Act was a key promise in Labour’s general election manifesto and is the centrepiece of the Government’s ‘Plan to Make Work Pay’. Ministers say it will “help bring our employment rights legislation into the 21st century, extending modern protections to millions more workers”.   

The legislation places significant new obligations on employers through 28 major reforms covering areas including sick pay, parental leave, unfair dismissal and trade union membership.  

While trade unions have praised the regulations, employers’ groups have argued that they will cause high levels of red tape and costs for businesses. This led to negotiations between those groups and the Government, as well as months of parliamentary back and forth.  

The Act became law on 18th December 2025 but the changes will be introduced over a two-year period to give businesses time to prepare. Many of the changes are subject to consultation.  

The Government published a roadmap for implementation in July 2025 and there are factsheets on many of the changes here.  

Here’s a summary of the current timetable. 

February 2026 

The following changes will be introduced: 

• Repeal of the Strikes (Minimum Service Levels) Act 2023. These rules mandate ‘minimum service levels’ during industrial action. 
• Repeal of the majority of the Trade Union Act 2016 which places restrictions on industrial action and trade union activities such as a minimum 50% turnout for strike ballots. Some provisions will be repealed via commencement order at a later date. 
• Removing the 10-year ballot requirement for trade union political funds.  
• Simplifying industrial action notices and industrial action ballot notices.  
• Protections against dismissal for taking industrial action.  

April 2026 

The following changes will be introduced: 

• Day one rights for employees to paternity leave and unpaid parental leave, and the restriction on taking paternity leave after shared parental leave removed. 
• The lower earnings limit and waiting period for Statutory Sick Pay (SSP) removed. This means SSP will be paid from the first day of illness, instead of the fourth day, and employees will not need to earn a minimum amount to be eligible. 
• The Fair Work Agency established. It will bring together existing enforcement bodies and take on the enforcement of other employment rights such as holiday pay and SPP.  
• Whistleblowing protections expanded to include sexual harassment.
• The maximum period of the collective redundancy protective award doubled from 90 days' pay to 180 days' pay. 
• Simplifications for how a trade union can gain recognition in a workplace and allowing trade union members to vote electronically. 

October 2026 

The following changes are due to be introduced following further consultation:  

• Changes on ‘fire and rehire’ to prevent employers from dismissing someone then rehiring them on worse terms and conditions. 
• Employers are required to inform workers of their right to join a trade union. 
• Employment tribunal time limits increased from six to three months.  
• Employers required to take “all reasonable steps” to prevent sexual harassment of their workers. 
• Employers are obliged to not permit the harassment of employees by third parties. 
• Tipping laws tightened with employers required to consult with employees when creating a tipping policy and review the policy every three years.  
• New rights and protections for trade union representatives. 
• Strengthening trade unions' right of access. 
• Measures to ensure “fair and equitable employment conditions” between public sector staff who have been transferred under TUPE and private sector employees working on the same outsourced public sector service contracts. 
• Extending protections against detriments for taking industrial action.   

December 2026 

The mandatory seafarers’ charter is expected to be introduced. It introduces minimum employment standards, such as fair pay, working conditions, and employment rights, for seafarers working on vessels regularly operating in UK waters. 

2027 

The following changes are due to be introduced following further consultation:  

• Employees provided with the right to unfair dismissal after six months in a job. It is currently two years. The Government originally wanted this to be a day one right but it was switched to six months after talks with industry groups and trade unions. 
• Workers on zero hours contracts given the right to guaranteed hours if they want them.  
• Changes to flexible working including employees getting a day one right to request flexible working (currently after 26 weeks), allowing two requests per year (currently one), requiring employers to consult with the employee before rejecting a request, shortening employers’ decision period to two months (currently three) and requiring that employers explain to employees why their decision is reasonable if they reject a request. 
• A new statutory right for employees to bereavement leave. 
• Enhanced job dismissal protections for pregnant women and new mothers. 
• Extension of rules to protect a wider range of people from blacklisting due to trade union membership or activity. 
• Collective redundancy changes: Employers need to consider the total number of redundancies across their whole organisation, not just individual workplaces, and increased collective redundancy protection for workers on ships regularly operating from British ports but registered outside Great Britain. 
• Employees given the right to be paid if a shift is cancelled, moved to another date, or cut short.  
• Introduction of a new industrial relations framework. 
• Definition of agencies extended to include 'umbrella companies'.  
• Regulations to specify what steps are regarded as “reasonable”, to determine whether an employer has taken all reasonable steps to prevent sexual harassment.  

Get expert support and advice on employment law 

TaxAssist Accountants can put you in touch with employment law support service Employmentor. 

It is a practical and cost-effective service that equips your business with all the tools needed to manage day-to-day employment law issues, while complying with your legal requirements. 

Contact us on 01825-572-101 or complete our online enquiry form and we will call you back. 

First published 29 Jan 2026

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Dan Martin

Dan is a freelance journalist and event host who writes content for TaxAssist Accountants. With 20 years of experience, he has interviewed hundreds of entrepreneurs from famous names like Sir Richard Branson and Deborah Meaden to the founders behind the newest start-ups. Dan was previously Head of Content at small business membership organisation Enterprise Nation.

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