Key provisions of the employment rights bill

Written by Drew Wilson from TLT LLP

The Employment Rights Bill (ERB) intends to transform the landscape of employment law.

Many changes will not be implemented until 2026 or 2027, but whether you’re in leadership, HR, or trying to stay ahead of the curve, here’s a straightforward guide to some of the key changes that the government is tabling.

Day-one rights

The ERB would give employees ‘day one’ rights to the following:

• Statutory sick pay
• Parental and paternity leave
• Protection from unfair dismissal

Currently, employees must satisfy qualifying periods of service to receive these. The changes would grant employees instant access to these rights from day one of their employment.

The changes to parental leave, paternity leave and statutory sick pay are due to come into force in April 2026.

One of the ERB’s headline features is protection from unfair dismissal. The government is proposing to introduce a statutory probationary period – it has been suggested that this period will be nine months.

During the statutory probationary period, a ‘lighter touch’ dismissal process could be used.

Estimated date of implementation: 2027, although consultation about this is due to take place shortly.

Zero-hours contracts

The ERB is cracking down on the unpredictability of zero-hours contracts.

A great deal of the detail is still to be ironed out and the provisions appear especially complicated, but the general proposal is that employers would have an ongoing duty to offer zero and ‘low hours’ workers (including agency workers) a guaranteed hours contract reflecting the hours they regularly worked during a reference period – which has been suggested to be 12 weeks.

A worker will have the option to accept or reject the offer.

It is also proposed that zero and ‘low hours’ workers (including agency workers) would be entitled to reasonable advanced notice of shifts, including cancellations or changes to shifts.

If a ‘qualifying shift’ is cancelled, moved or curtailed at ‘short notice’, a worker would need to be compensated. Many of these terminologies are still to be ironed out through consultation.

Estimated date of implementation: 2027, but the government will be consulting on them later this year.

Fire-and-rehire

Fire and rehire is a phrase commonly used for the process whereby an employer dismisses staff and offers to rehire them on less favourable terms as a way to change terms and conditions of employment.

Broadly speaking, the ERB intends to restrict this so that dismissing an employee for refusing to agree to a contractual variation will be automatically unfair in relation to ‘restricted variations’ (which would include reductions to pay or holiday entitlement, as well as changes to pension schemes and working hours).

There will be an exception where a variation is required to address ‘financial difficulties’ (as defined under the ERB) but this exception is expected to be quite limited.

Estimated date of implementation: October 2026 with the government consulting on this later in the year.

Redundancy consultation

For employers planning collective redundancies, the penalties for non-compliance are scheduled to significantly increase. In particular:

• Collective redundancy consultations are currently required where an employer proposes to make 20 or more employees redundant at one establishment. However, the proposal that employers will need to aggregate redundancy numbers across all of their sites, not just on a per-establishment basis, will mean that many more employers may be caught by the obligation to collectively consult about redundancy proposals.
• The maximum protective award (for failure to comply with collective consultation obligations) will be doubled, from 90 to 180 days’ gross pay per affected employee.

Estimated date of implementation: The change to the protective award is due to come into force in April 2026 and it is anticipated that the remaining reforms would not come into force until 2027.

Flexible working: the new normal in a post-COVID world

The right to request flexible working would remain a ‘day one’ right except where it is not ‘reasonably feasible’.

• The ERB adds a new test of ‘reasonableness’ to any refusal of a flexible working request.
• When an employer notifies an employee that their request has been refused, they must state the grounds for refusal and explain why they consider it is reasonable to refuse the request.

Estimated date of implementation: 2027 although the government will be consulting on it towards the end of this year / early next year.

Trade unions: a new industrial relations landscape

The ERB is looking to implement a wide range of reforms to the industrial relations landscape. Examples include:

• making the statutory recognition process easier for unions;
• introducing the use of electronic balloting in hopes of increasing participation in statutory ballots;
• simplifying information required in ballot notices and papers;
• giving greater rights of access to trade union officials; and
• requiring employers to inform employees of their right to join a union.

Estimated date of implementation: Some reforms will take effect 2 months after the ERB gains Royal Assent (therefore potentially this year), and others will be implemented in 2026 and 2027 as the government is intending to consult on many of its reforms relating to industrial relations later this year.

Protecting pregnant workers and new parents

Although we await further detail, it is proposed that pregnant employees and new mothers will get stronger protections against redundancy and dismissal.

The government has said that its intention is to make it unlawful to dismiss those who have been pregnant within 6 months of their return to work, except in ‘specific circumstances’ – which is yet to be defined.

Estimated date of implementation: The government will be consulting on this later this year, and it is anticipated that the reform would come into force in 2027.

Other noteworthy changes

A few further reforms in the ERB worth keeping in mind are:

• Bereavement Leave: New statutory entitlement for employees from day one of their employment.
• Tips and Gratuities: 100 per cent must go to workers and they must be allocated in a fair and transparent way.
• Protections for whistleblowers: A report of sexual harassment will become a protected disclosure for whistleblowing purposes.

So, what should employers do now?

Here’s your quick action list:

• Assess your contracts and evaluate HR policies
• Provide training to managers once the new rules are effective
• Where relevant, engage with applicable unions and employee representatives
• Keep up-to-date with developments as the ERB continues to develop

The ERB is undoubtedly going to be a game-changer for employers and workers. The extent of the impact will turn heavily on the detail that will develop through various consultations that are scheduled this year and next year, so the fullest impact of the reforms will remain unclear until further regulations have been published.

Employers should therefore stay alert to the upcoming consultations, share your views about the pending changes, and keep an eye on any of the ERB’s further developments.