Upcoming Changes under the Employment Rights Act 2025
The Employment Rights Act 2025 (‘ERA’) came into force in December 2025. The changes to employment law brought about by the ERA are being introduced gradually, with some already having been implemented between December 2025 and April 2026.
The next set of changes are due to come into force from October 2026. This guide contains a summary of those changes, together with some practical steps that can be taken by employers to prepare.
Employment Tribunal Time Limits (1 October)
The time limit for bringing an employment tribunal claim will increase from three months to six months. This change will take effect later, on 9 November 2026, in respect of breach of contract claims in Scotland.
The new time limits will apply where the relevant act, detriment or dismissal takes place on 1 October 2026 or later. Situations where the relevant act, detriment or dismissal occurs before that date will remain subject to the existing three-month time limit.
Acas Early Conciliation (Acas EC) remains a mandatory requirement, where applicable, before an employment tribunal claim can be submitted. Registering for Acas EC pauses or ‘stops the clock’ on the time limit for presenting a claim.
The time limit increase provides employees with a greater opportunity to gather evidence and to seek legal advice.
For employers, the increase effectively extends the window of risk, as employment disputes and potential claims remain live for considerably longer. Taking into account the maximum duration of 12 weeks for Acas EC (which doubled in December 2025 from six weeks), employers face a prolonged period of uncertainty following dismissals, grievances and workplace disputes. It could be nine months (perhaps longer) from the date of the relevant act before employers receive a tribunal claim.
A potential benefit for both parties is that the extended time limit to submit claims provides more opportunity to resolve matters through negotiation and to avoid costly, time-consuming and disruptive litigation.
It is advisable for employers to do the following:
- Review document retention and record-keeping practices. Ensure that records are retained for longer and can be located quickly in the event of an employment tribunal claim.
- Ensure that workplace processes are followed consistently and that managers receive appropriate training on how to handle disciplinary, performance and grievance matters, as well as knowing when to involve HR or to obtain legal advice. Inadequately managed processes create risks that can be avoided.
- Focus on early dispute resolution and prompt handling of internal grievances. Addressing concerns early, either through properly managed processes or constructive discussions, can be an effective means of avoiding or significantly reducing the risk of litigation.
Harassment
Enhanced Proactive Duty to Prevent Sexual Harassment (30 October)
Employers will be required to take all reasonable steps to prevent sexual harassment of their workers, raising the existing legal threshold which requires employers to take reasonable steps.
The move to all reasonable steps requires proactive risk management, comprehensive planning and documented action. Being reactive will not be sufficient. Employers will be required to demonstrate that they have anticipated risks, planned for them and taken practical steps to prevent sexual harassment before it takes place.
The Equality and Human Rights Commission (EHRC) has issued an eight-step guide to preventing sexual harassment at work which includes a video.
The practical steps contained in the guidance illustrate the types of measures employers can take to prevent and deal with sexual harassment in the workplace. The steps are not intended to be an exhaustive list, but should support employers to take positive action to prevent and deal with sexual harassment at work.
Liability for Third Party Harassment (30 October)
Employers will become liable for harassment of their workers that has been committed by third parties (e.g. customers, clients, contractors or members of the public) unless they have taken all reasonable steps to prevent it from happening. This applies to all types of harassment (not just sexual harassment) and a single incident is sufficient to give rise to a claim.
Taking all reasonable steps means doing what is possible and proportionate with the employer’s available resources. Some steps will not be possible for every employer to take and there’s no one size fits all approach.
The steps that an employer will be required to take will depend on the organisation itself (i.e. its size, the sector, the kind of work that workers do and the risk of third-party harassment generally). Steps may include:
- Regularly assessing risks for third-party harassment and taking steps to avoid or reduce such risks
- Monitoring and recording incidents and documenting any actions that resulted
- Implementing and maintaining a policy covering how to deal with third party harassment
- Training workers on matters including safety of staff and de-escalation
- Reviewing contracts with third parties to ensure they include relevant content
- Informing customers of the consequences of harassing workers (e.g. on posters, in emails and on pre-recorded telephone messages)
In respect of higher risk environments, steps could also include:
- Ensuring there are appropriate numbers of workers in place at any one time (e.g. security staff)
- Providing appropriate safety equipment and ensuring that it is used (e.g. personal alarms, body or security cameras)
Trade Union Rules (30 October)
The following changes will be introduced on 30 October 2026, with one key change pushed back to January 2027:
- Independent trade unions will have a new statutory right to seek physical and digital access to workplaces for the purpose of meeting, supporting, recruiting and organising workers. The right applies in respect of employers with 21 or more workers, whether or not the employer currently recognises a trade union. There are strict time limits for responding to an access request and to subsequently agree terms. Where agreement cannot be reached, disputes are referred to the Central Arbitration Committee (CAC). Breaching statutory access agreements can trigger cumulative and significant financial penalties imposed by CAC.
- New rights and protections for trade union and equality representatives carrying out duties, including a right to reasonable accommodation, facilities and a right to time off.
- An updated Code of Practice on trade union recognition.
- Extending protections for workers against being treated less favourably by their employers for taking part in industrial action.
The following steps will help employers prepare for the changes:
- An assessment of the quality of existing arrangements for engagement and worker representation. If such arrangements are already in place, ensure that staff are aware of and engage with them. If not already in place, this is an opportunity to create them.
- The development of access arrangements – consider what access can be offered (meeting spaces, frequency, digital alternatives) and when access can take place (during breaks or at the end of the working day may avoid significant disruption to business continuity).
- Establish staff dedicated to dealing with access requests, ensure the team is sufficiently trained, prepared and has authority to respond to requests on behalf of the employer within the strict response window and to implement negotiation procedures.
Public Sector Outsourcing (exact date to be confirmed)
When public services are outsourced, workers move from the public to the private sector. This can have the effect of creating a two-tier workforce, where new employees (private sector recruits) receive less favourable pay and conditions than the ex-public sector workers, leading to two tiers in terms of pay and conditions.
The ERA will implement measures to prevent this effect, by reinstating and strengthening the ‘Two-Tier Code’ (previously withdrawn in 2011) which ensures equal terms and conditions for ex-public sector and private sector employees.
The statutory obligations will require public bodies to take all reasonable steps to ensure that the correct provisions are included in outsourcing agreements. Enhanced monitoring processes and compliance reviews are likely to be required to ensure ongoing compliance by suppliers. Once a contract has been awarded, private-sector employers will need to train managers to ensure compliance, including by any subcontractors who may be engaged in providing the service.
New Adult Social Care Negotiating Body (exact date to be confirmed)
A new Adult Social Care Negotiating Body will be established for the adult social care sector, to lead the Government’s Fair Pay Agreement. This will introduce annual negotiations between employer and worker representatives or trade unions, resulting in legally binding agreements covering minimum standards on pay, terms and conditions, training and career progression for employees working in the sector.
It is anticipated that the first round of negotiations will begin in 2027, with the first agreement taking effect in April 2028.
On the Horizon
New Regulations for Seafarers
On 1 December 2026, new regulations will come into force which are applicable to seafarers. The Seafarers’ (Wages and Working Conditions) Regulations introduce improved standards of health and safety, pay, job security and rest breaks.
Tipping
By the end of 2026, changes will be made to tipping law. Currently, workers are entitled to receive tips in full, they must be allocated fairly and transparently, and payments must be paid the month after the customer paid the tip. In many cases, a written tipping policy setting out how tips are dealt with and records of tip allocation going back three years must be made available to employees.
Upcoming changes include the requirement for employers to consult with workers when developing tipping policies and carrying out policy reviews. Further detail will be included in a revised Code of Practice on the Fair and Transparent Distribution of Tips.
Unfair Dismissal
From 1 January 2027, employees will have the right to claim ordinary unfair dismissal after being employed for six months (reduced from two years) and the limit on compensation for unfair dismissal claims will be removed, allowing claims based on actual and projected financial loss.
This means that anyone employed on or before 1 July 2026 acquires protection from 1 January 2027.
The reduced qualifying period means that employers will have a much smaller window of time in which to assess the performance of employees and to effect short-service dismissals before the right against unfair dismissal is acquired. A probationary period of six months no longer provides a safe window for dismissal, taking into account statutory minimum notice requirements.
To avoid the risk of a claim for unfair dismissal, employers need to bring forward decisions about the suitability of new hires. Shorter probationary periods together with active and meaningful reviews during that period are advisable, to enable effective monitoring of progress and to allow informed decisions to be made on whether to retain or dismiss in good time, before the right against unfair dismissal is acquired.
Protection against Fire and Rehire
Increased protections against dismissal and rehire will be implemented on 1 January 2027.
It will become automatically unfair to dismiss an employee where the only or principal reason for dismissal is where the employer tried to make a ‘restricted variation’ to the employee’s contract of employment, the employee did not agree to the variation and the employer dismissed the employee so that it could either employ someone else in their place or re-employ the original employee in the same or similar role but on new terms.
Restricted variations include negative changes to pay or pension benefits, holiday entitlement, changes to hours of work including number of hours worked and shift patterns and any attempt to insert a contract term permitting those such changes to be made without the employee’s consent.
It will be a defence if the employer can prove both that it was in serious financial difficulties (i.e. the survival of the business is under imminent threat) and it could not reasonably have avoided the need to make the restricted variation.
Duty to Inform Workers of Their Right to Join a Trade Union
The Government recently published their response to the public consultation on the upcoming change to Trade Union Rules.
From January 2027 (exact date to be confirmed), employers will be required to provide workers with a written statement setting out the right to join a trade union, regardless of whether the workplace is currently unionised. This statement will be standardised with some specific inclusions, and will be set out in regulations that are yet to be published.
The regulations will contain detailed information covering what the written statement must include, as well as when and how the statement should be issued to new and existing workers.