The Employment Rights Act – a summary for Employees and Employers

Shepherd Stubbs | Updated November 2026

The Employment Rights Act 2025 received Royal Assent on 18 December 2025 and is the biggest change to UK employment law in a generation. Its measures are being phased in from 2026 into 2027, and several of the most significant changes arrive in the next few months. Whether you are hiring or looking for your next role, here is what you need to know.

The key dates

Already in force (April 2026)

• Paternity leave and unpaid parental leave became day-one rights, with no qualifying period
• Statutory Sick Pay is now payable from the first day of sickness, and the lower earnings limit has been removed
• The Fair Work Agency launched on 7 April 2026 to strengthen enforcement of employment rights
• Whistleblowing protection now covers disclosures about sexual harassment
• The protective award for failing to consult properly on collective redundancies doubled

1 October 2026

• The time limit for bringing most employment tribunal claims extends from three months to six months

30 October 2026

• Employers must take all reasonable steps to prevent sexual harassment of their staff
• Employers become liable for harassment of staff by third parties, such as clients and customers
• Stronger trade union rights, including rights of access to workplaces and new protections for union representatives

End of 2026

• Reform of tipping law, which has been pushed back from October

1 January 2027

• The qualifying period for ordinary unfair dismissal falls from two years to six months
• The cap on compensation for unfair dismissal is removed
• New restrictions on fire and rehire come into force

During 2027 (dates to be confirmed)

• Further measures are expected, including new rights for workers on zero-hours and low-hours contracts, changes to flexible working, bereavement leave and stronger protections for pregnant workers and new mothers

What it means for employees

• More protection, sooner. From 1 January 2027, you will be able to bring an unfair dismissal claim after six months in a role rather than two years, and the compensation limit on those claims is lifted
• More time to act. If something goes wrong at work, you will have six months rather than three to bring a tribunal claim, for events from 1 October 2026
• Better family and sickness rights. Day-one paternity and parental leave, and sick pay from the first day of illness, are already in place
• Stronger protection from harassment. Employers must be proactive about preventing sexual harassment, including by clients and customers
• Greater certainty over hours. Workers on zero-hours and low-hours contracts are expected to gain a right to reasonable notice of shifts and guaranteed hours in 2027

A key point to remember is that six months of protection does not mean a job for life. Employers can still dismiss fairly for reasons such as conduct, capability or redundancy, provided they follow a fair process.

What it means for employers

• Probation periods matter more. With a six-month qualifying period, the traditional probation window and the point at which unfair dismissal rights begin now line up. Reviews, objectives and documented feedback in the first six months will be essential
• Dismissal decisions carry more risk. Removing the compensation cap means the financial exposure from a poorly handled dismissal is no longer limited
• Harassment prevention must be demonstrable. Written policies are not enough. You should be able to show training, risk assessments, clear reporting routes and action taken, including where the conduct comes from clients or customers
• Fire and rehire is being restricted. If you rely on dismissing and re-engaging staff to change contract terms, plan any changes now and review your contract templates
• Longer limitation periods. Expect claims to surface later, so keep good records of decisions, meetings and warnings
• Policies and contracts need updating. Review sick pay, family leave, harassment, probation and disciplinary documents, and prepare for the zero-hours and flexible working changes due in 2027

A practical checklist for employers

• Review contracts, handbooks and policies against the changes above
• Tighten your probation process, with regular documented reviews before month six
• Update harassment prevention training and your complaints procedure before 30 October
• Plan any changes to contract terms ahead of the January 2027 fire and rehire rules
• Check how you use zero-hours and agency arrangements, and plan for the 2027 reforms
• Keep thorough records of performance and conduct

What it means for hiring and recruitment

The reforms will change how both sides approach the early months of a role. Employers will want to be even more confident that they are hiring the right person and candidates will have a stronger basis for judging the security of a position. Clear job descriptions, realistic expectations and a structured onboarding process help both parties and reduce the chance of an early parting of ways.

At Shepherd Stubbs, we help employers find people who are the right fit from day one and we help candidates find roles with employers who take their responsibilities seriously. If you would like to talk about how these changes affect your hiring plans or your next career move, please get in touch with our team.

Look out for our follow-up blogs to this article including: Is It Bad For Business and the Pros and Cons for Businesses and Workers.

This article is a general summary for information only and is not legal advice. Implementation dates and details may change, so please take advice from a qualified employment law adviser or check GOV.UK before acting on any of the points above.