Legal update: The Employment Rights Bill has finally passed – here’s what you need to know
It’s official. After 14 months of debate, the Employment Rights Bill has passed through the House of Lords and becomes law tomorrow, 18 December, as the Employment Rights Act.
First, a quick recap
If you’re new to the Employment Rights Bill or if you feel like you’ve lost track of it during months and months of various updates and changes, not to worry.
Put simply, the Employment Rights Bill is the biggest update to employment law in Britain in 30 years (it doesn’t apply in N Ireland). When it started, the Bill was 158 pages long. By the end, it had grown to more than 330 pages, with over 30 reforms being proposed.
The Bill had to go through a long, stormy journey to be approved. The House of Commons and House of Lords have been passing the Bill back and forth to reach a version they agree on, which finally happened as of yesterday.
But even though the Act becomes law now, the changes don’t all “switch on” at once. The government is running at least 26 separate consultations to work through the detail on what exactly employers will need to do to comply with the Act. These details will be set out in secondary legislation (regulations) after the consultations are complete.
They’re also still committed to the implementation timeline they published earlier this year, which means changes start coming into force from April 2026 and continue into 2027.
Three things to focus on in the new year
We’ve given a quick overview of all the upcoming changes in a handy timeline.
You can go straight to that if you’d like, but we know some people can find the full list a bit overwhelming – and, as we’ve said, many of the measures are subject to clarification once consultations have been completed.
So, instead, we thought it would be more helpful to start with an overview of three areas likely to affect your costs and day-to-day operations.
- The sick pay shift (from April 2026)
What’s changing
The “waiting days” for Statutory Sick Pay (SSP) are being scrapped. Right now, you don’t usually pay SSP for the first three days of sickness. From April 2026, SSP will be payable from day one of sickness absence.
The requirement to earn at least the “Lower Earnings Limit” is also going. That means even your lowest-paid employees will qualify for SSP.
What this means for you
You’ll need to budget for higher sickness absence costs from 2026 and make sure your absence management processes – like completion of self-certificates and return-to-work interviews – are clear, consistent and followed.
- The new six month rule for unfair dismissal (from January 2027 – plan now)
What’s changing
The current two-year qualifying period for ordinary unfair dismissal claims is being cut to six months. The government has also said they plan to bring this into force on 1 January 2027 with immediate effect, so the right will apply to anyone who’s completed six months of employment by 1 January 2027 – i.e., people who were hired as far back as 1 July 2026.
What this means for you
This is a big shift for every employer, especially if you’re in sectors like construction or care, where turnover is high and you recruit regularly. Your recruitment decisions, induction and probation periods will carry even more weight. It’s really important that you have clear processes, training, and documentation in place to protect your business from any claims.
- A tougher stance on harassment (from October 2026)
What’s changing
Employers will be liable for harassment by third parties such as customers or suppliers, unless they can show they have taken “all reasonable steps” to prevent it happening. This new obligation applies to all types of harassment, not just sexual harassment (for example, harassment related to age, race, disability etc).
What this means for you
This is not just about having a policy sitting on a shelf – it’s a live legal responsibility.
If you have people coming into contact with third parties, whether it be through working on a client site, working in the community or where third parties such as suppliers or customers come into your workplace, you’ll need to be able to show you’ve identified and managed the risks around this.
The implementation timeline
Based on what we know now, here’s the key timeline the government has committed to:
April 2026
- Statutory Sick Pay – removal of waiting days and the Lower Earnings Limit requirement
- Fair Work Agency established
- Collective redundancy protective award – doubling the maximum period of the protective award
- ‘Day 1’ Paternity Leave and Unpaid Parental Leave
- Increased whistleblowing protections
- Simplifying trade union recognition process
- Electronic and workplace balloting
- Voluntary gender pay gap and menopause action plans
October 2026
- Requiring employers to take “all reasonable steps” to prevent sexual harassment of their employees
- Introducing an obligation on employers to prevent the harassment of their workers by third parties
- Fire and rehire reforms
- Extending tribunal time limits (from 3 months to 6 months)
- Introducing regulations to establish the Fair Pay Agreement Adult Social Care Negotiating Body
- Tightening tipping laws
- Duty to inform workers of their right to join a trade union
- New trade unions’ right of access
- New rights and protections for trade union reps
- Extending protections against detriments for taking industrial action
2027
- Right to claim unfair dismissal after 6 months’ service – coming into force on 1 January 2027
- Zero-hours contract reforms, including the right to a guaranteed hours contract, right to reasonable notice of shifts and the right to reasonable notice of the cancellation, curtailment or movement of shifts (and compensation where this is breached)
- Gender pay gap and menopause action plans (introduced on a voluntary basis in April 2026)
- Enhanced rights for pregnant workers
- Introducing a power to make regulations to specify steps which would be considered “reasonable” steps to prevent sexual harassment
- Provisions relating to blacklisting
- Industrial relations framework
- Regulation of umbrella companies
- Collective redundancy – changes to the collective consultation threshold
- Flexible working changes
- Bereavement leave provisions
How we’ll support you
The passage of this bill will mark the beginning of a two-year period of change that will completely overhaul employment rights in Britain. We’ll be keeping you informed every step of the way, so look out for future updates.
From the New Year, we’ll be rolling out:
- A complete guide to the changes: In January, we’ll send you a comprehensive, plain English guide to the Employment Rights Act and what it means for you.
- Three exclusive client webinars:
- The Overview: a high-level run-through of the key changes and timelines.
- The April 2026 changes: a deeper dive into sick pay, family leave and the new enforcement approach.
- Managing sickness absence: practical steps to manage costs, reduce absence and stay compliant.
You don’t need to be an employment law expert – that’s our job. We’ll keep you updated, explain what each stage means in practice, and help you get your policies, contracts and processes in shape well before the deadlines.
If you have any further questions about these changes, please contact us on 0345 844 4848. As a reminder, our advice line is available 24/7, 365 days a year*, but for non-advice queries, we’ll be out of office from 23 December until 2 January 2026.
*Applicable for all clients who’ve purchased Citation’s HR & Employment Law and/or Health & Safety core service, including H&S and HR Workplace Expert. Please note that our H&S and HR Virtual Assistance clients don’t have access to 24/7 advice.
