The UK government is preparing to introduce a landmark series of reforms under the Employment Rights Bill, aimed at strengthening worker protections and creating a fairer, more modern employment landscape. The changes, which it has confirmed will be phased in over time, are expected to impact millions of workers and will place new and significant responsibilities on employers. As the legislative environment evolves, it is essential for organisations of all sizes to respond with strategic foresight, clear communication, and updated compliance procedures. The measures signal a cultural shift in the world of work.

Key Legal Changes All Employers Should Prepare For:

1. Flexible Working became the New Default in April 2025

• Flexible working has become the assumed standard wherever practical, encouraging employers to support diverse working patterns.
• All employees have the legal right to request flexible working - meaning they can request changes to where and/or the number of hours they work, when they start or finish work and the days they work. They can now make a request for flexible working from day one of employment, twice a year.
• Employers must now respond to flexible working requests (including any appeal) within two months and can only refuse a request if it is reasonable and must provide clear, specific reasons for any refusal. Employers are also now required to consult with employees before refusing any request.

2. Immediate Employment Rights from Day One

• Employees will receive protection from unfair dismissal starting from their first day in a new role, replacing the current qualifying period of 2 years. The Employment Rights Bill, due to take effect in 2027, proposes to replace the 2-year qualifying period with a new concept called the ‘initial period of employment’, probably a nine-month window during which employers can dismiss staff using a simpler process. The House of Lords in July 2025 voted to remove the ‘initial period’ entirely and reduce the 2-year requirement to a six-month qualifying period. The Bill will now return to the House of Commons, and it is likely the ‘initial period of employment’ will be re-instated. Consultation began this summer and continues into early 2026.
• Key entitlements such as unpaid parental leave, paternity leave for fathers employed for more than six months, and from 2027, bereavement leave, will be available from ‘Day One’, helping to build a more inclusive and compassionate workplace culture.
• Enhanced whistleblower protections are also expected in April 2026.

3. Expanded Statutory Sick Pay (SSP) Coverage from April 2026

• SSP will be expanded to be paid from the first day of absence, removing the existing waiting period. Currently, SSP is paid from the fourth qualifying day of sickness absence.
• The Bill proposes the removal of the lower earnings limit which will extend eligibility to SSP to over 1.3 million low-paid workers, boosting income security for those most at risk of financial hardship when unwell. It proposes that SSP be paid at a rate of 80% of the employee's normal weekly earnings, up to a capped amount.

4. Creation of the Fair Work Agency (FWA) in April 2026

• The FWA will be a new body which will oversee the enforcement of employment rights and be empowered to investigate, prosecute, and impose financial penalties on businesses that violate employment law. This body would serve as a vehicle for workers seeking redress for violations of their employment rights and offer compliance support for businesses, making it easier to understand and implement fair working practices. It is intended to cover several functions including employment agencies and regulations, National Minimum Wage rights, Statutory Sick Pay and Statutory Holiday Pay. It is proposed the FWA will be able to bring Employment Tribunal proceedings on the behalf of workers who are unable or unwilling to do so.

5. Restricting “Fire and Rehire” Practices from October 2026

• Clause 22 of the Bill will make the practice of dismissing staff to rehire them on less favourable terms automatically unfair; except if it is done under strictly defined financial hardship conditions and the employer can demonstrate that the changes were unavoidable. The Bill will not eradicate the practice of “fire and rehire” but should significantly limit the circumstances in which it can be legally undertaken.

6. Enhanced Protection Against Third-Party Harassment from October 2026

• Currently there is no specific employer liability for harassment of their staff by third parties, i.e. by customers or clients. The Bill will place greater responsibility in the hands of employers to take action to prevent such behaviour and holding them accountable for not doing so. While new rules in relation to sexual harassment were introduced in October 2024, the Bill proposes to make employers liable for harassment perpetrated by third parties where the third party harasses their employee in the course of their employment; and the employer has failed to take “all reasonable steps” to prevent it from happening. Employers should consider undertaking a risk assessment like that required in respect of the duty to prevent sexual harassment.

7. Reform of Zero-Hours Contracts in 2027

• The Bill will require employers to offer ‘qualifying workers’ guaranteed hours reflecting the hours they regularly work over reference period, to be set in regulations and expected to be 12 weeks. Workers will be able to reject an offer of guaranteed hours and remain on a zero hours’ contract if they wish.
• Employer will be required to provide workers with reasonable notice of shifts and require employers to make payments to workers should they cancel, move or curtail a shift at short notice.
• With regard to agency workers, the agency and the hirer will be responsible for providing an agency worker with reasonable notice of shifts. The regulations may also apply differently for directly engaged and agency workers.

How These Changes Will Impact Employees

The upcoming reforms are designed to deliver tangible benefits to workers across the UK. Employees should expect:

• Stronger job security: By removing probationary exclusions and outlawing some exploitative dismissal methods, workers should gain greater confidence and stability.
• Improved work–life balance: Improved flexible working rights, and accessible family leave should support wellbeing and further accommodate individual personal commitments.
• Better financial resilience: Extended access to SSP and predictable working hours will ensure a more stable income for many, especially those currently in low-paid roles.
• Fairer treatment for vulnerable workers: Enhanced protections and a proactive enforcement agency should reduce inequality and raise workplace standards across a number of sectors.

Steps Employers Should Take to Prepare

Employers should be compliant with statutory rights, especially those backed by civil and criminal penalties. The legal changes outlined above will affect all UK businesses, irrespective of size or industry. Non-compliance may carry significant financial, legal and reputational risks, so businesses are strongly advised to prepare now, rather than pay a price later.

Recommended action points to Employers:

• Conduct a comprehensive review of employment contracts and your internal policies.
• Train managers and your HR personnel to handle flexible working requests, dismissal procedures, and on your anti-harassment responsibilities.
• Audit payroll systems and statutory benefits administration in line with SSP and wage reforms.
• Strengthen your grievance, disciplinary and compliance protocols to reduce any employment tribunal exposure.

Rest assured - support is available. Our dedicated Employment Law specialist, Anthony Willis, is on hand to help businesses navigate these changes with confidence. Whether you're seeking expert advice, template policies, or customised HR support, Anthony can guide you through every requirement and ensure your organisation remains protected and compliant.

Don’t wait for the October deadline. Reach out today to begin preparing your business for success under the new legislative framework. Proactive planning won’t just shield you from penalties, it will help foster a stronger, fairer, and more engaged workforce.