Employment Rights Act 2025: What You Need to Know

The Employment Rights Act 2025 is one of the most significant updates to UK workplace law in decades. It introduces sweeping changes designed to give workers stronger protections, more flexibility, and fairer treatment.

The changes don’t come into effect immediately, anticipated throughout 2026 and 2027 following consultations, impact assessments and yet to be finalised regulations, but here’s a simple breakdown of what’s coming and what it means for employees and employers.

1. Stronger Protection Against Unfair Dismissal

Previously, employees had to work for two years before they could claim unfair dismissal. Under the new law, that qualifying period drops to six months. This means employees will have protection much sooner. Plus, the cap on compensation for unfair dismissal we go with tribunals being able to award unlimited compensation, making it riskier for employers to dismiss staff without good reason.

2. More Time to Make a Claim

If employees need to take their employer to an employment tribunal, they will have six months to file most claims instead of three. This extra time gives workers breathing space to seek advice and prepare their case.

3. Fire and Rehire Crackdown

“Fire and rehire” is when employers dismiss staff and offer them new contracts on worse terms. The Act will make this practice much harder. If an employee refuses certain changes, like cuts to pay or hours, their dismissal could be automatically unfair.

4. Sick Pay and Family Leave from Day One

Big improvements here:

• Statutory Sick Pay to start from an employee’s first day off sick, and the earnings threshold to be scrapped.
• Paternity leave, unpaid parental leave, and bereavement leave available from day one of employment. 

5. Flexible Working Provisions untouched

Employees already have a day one right to request flexible working, but any refusal will need to be reasonable.  Employers will need to explain any ground for refusal in writing and why it is reasonable. 

6. Ending Exploitative Zero-Hours Contracts

The Act tackles insecure work by giving people on zero-hours contracts the right to predictable hours and broadens the scope to include agency workers. The rules are detailed and complex and further key details, to bet set out in regulations, will be required to help employers navigate these changes. 

7. Tackling Harassment and Protecting Whistleblowers

Tightening up on the 2024 changes, employers will be required to take “all” reasonable steps to prevent sexual harassment at work, including harassment by customers or clients.  This covers all types of harassment.  Whistleblowing protections will cover harassment complaints, and Non-Disclosure Agreements will not be able to be used to silence victims of discrimination or harassment.

8. Trade Union Rights Strengthened

Changes will repel recent restrictions on strikes and makes it easier for unions to gain recognition. Workers will see improved access to union support and fairer rules around industrial action.

9. New Enforcement Bodies

Two new agencies, the Fair Work Agency and the Office for Equality and Opportunity, will oversee compliance, provide guidance, and help resolve disputes. This should make enforcement more consistent and accessible.

10. Bereavement leave for pregnancy loss

The original bill introduced a new right to at least one week of unpaid bereavement leave.  This will now go further to include employees and their partners who experience pregnancy loss before 24 weeks. 

If you’re an employer, what should you do now?

Employers should review contracts, update policies, train managers, strengthen anti-harassment measures, plan for predictable hours, and prepare equality action plans to comply with the sweeping Employment Rights Act 2025 reforms.

Contact our Employment team today by emailing [email protected] or calling 01392 477983.