Employment Reforms in 2026: The biggest shake-up for employers in decades

The UK is on the cusp of a seismic shift in employment procedures. With the Employment Rights Act 2025 now enacted, employers across the country are facing the most comprehensive overhaul of workplace rights and responsibilities in a generation. These reforms are not just incremental updates, they represent a fundamental transformation of the employment landscape, with far-reaching implications for every organisation, large or small.

What is included in the Employment Rights Act 2025

The new legislation introduces a sweeping package of changes designed to strengthen worker protections, modernise employment practices, and rebalance the relationship between employers and employees. The first wave of reforms comes into force in February and April 2026, with further changes rolling out into 2027. For business leaders and HR professionals, the message is clear: preparation is essential.

Trade Union Laws: A New Era of Employee Relations

From 18 February 2026, the government is implementing major reforms to the UK’s trade union and industrial action framework. The removal of the 40% support threshold in key public services, combined with simplified ballot requirements, will make it significantly easier for unions to organise lawful industrial action. Ballots will now carry a 12-month mandate, giving unions more time to act, while employers will receive shorter, less detailed notices of impending action.

Crucially, workers will enjoy stronger legal protections, including freedom from detriment for participating in industrial action and the removal of the old 12-week limit on protection. These changes mark a substantial strengthening of union leverage and underscore the need for robust employee relations and proactive industrial action planning.

Day One Employment Rights

From 6 April 2026, the Employment Rights Act 2025 introduces a suite of new “day one” rights, making essential protections available to all employees from their very first day. Key changes include:

  • Statutory Sick Pay (SSP): Now payable from the first day of sickness, with the previous three “waiting days” abolished.
  • Paternity and Parental Leave: Unpaid paternity and parental leave become immediate entitlements, regardless of length of service.
  • Bereavement Leave: A new right to unpaid bereavement leave from day one, including for pregnancy loss before 24 weeks.

These reforms remove qualifying barriers and ensure that early-stage employment support is more inclusive and consistent across the workforce.

The Fair Work Agency

In April 2026 the Fair Work Agency (FWA) will launch, a new single enforcement body that consolidates several key regulatory functions. The FWA will bring more coordinated and robust enforcement, increase scrutiny of workplace practices and raise the stakes for compliance. Employers should expect more frequent and thorough investigations, making it vital to ensure that HR policies and procedures are up to date.

Further Reforms

  • Trade Union Recognition: The process will be streamlined, with electronic and workplace balloting making recognition easier for unions.
  • Protective Awards: The maximum award for failures in collective consultation will double, increasing financial risk for non-compliance.
  • Whistleblowing: Disclosures about sexual harassment made in the public interest will be protected, offering greater security for those who speak out.
  • National Minimum Wage (NMW): The NMW will rise again, boosting pay for millions but also increasing pressure on employers to review pay structures.
  • Family Leave Payments: Statutory Family Leave pay and lower earning limits will increase, supporting working parents.
  • Real Living Wage: From May 2026, the Real Living Wage will rise, reflecting the true cost of living and prompting employers to consider the risks of not keeping pace.

Looking ahead to October 2026, further changes will include a ban on fire-and-rehire practices, new rules on sexual harassment prevention, additional trade union reforms, and mandatory consultation on fair tip allocation in hospitality.

How our HR specialists can help

With reforms of this scale, HR compliance has never been more critical or complex. Mistakes could be costly, especially with the FWA’s enhanced enforcement powers.

Our HR specialists offer a flexible range of support options, providing as much or as little assistance as your business needs. Whether you’re looking for a comprehensive HR Health Check, ongoing guidance, or targeted advice on specific issues, we tailor our services to fit your requirements. We can review your policies, processes, and compliance, delivering clear recommendations and practical support to help safeguard your business through this period of change.

Get in touch today.

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