The Employment Law Act 2025 is introducing some fundamental changes to the law governing employment, and employers need to prepare now.
Some highlights are set out below, but there are numerous provisions which will come into force over the coming two years regarding flexible working, family rights, trade unions and other rights.
Employers need to take note and adjust their policies and procedures in order to reduce the risk of Employment Tribunal claims.
6th April 2026
Statutory Sick Pay (SSP) is now payable from the first day of sickness. It was previously only payable from the fourth day of absence. There is no requirement for the employee to provide a Fit Note to be entitled to SSP.
Paternity and unpaid parental leave rights will now be available to employees from the first day of employment. There is no longer a qualifying period.
Bereaved fathers where the mother has died can take up to 52 weeks paternity leave.
July 2026
Whilst nothing is being introduced during this month, from 1st January 2027, employees will have the right not be unfairly dismissed after being employed for six months. This period is retrospective, so employees employed from July 2026 will benefit from this right from January 2027. Currently, the right to claim unfair dismissal does not arise until an employee has been employed for a full two years, so this is a substantial change.
October 2026
Various provisions will be introduced which require employers to take all reasonable steps to prevent the sexual harassment of their employees, whether by their own staff or third parties and regulations will be put in place to identify what amounts to “reasonable steps”. Employers need to consider this and update their harassment and sexual harassment policies, procedures and behaviour to protect themselves from claims, and uplifts in compensation if reasonable steps had not been taken.
January 2027
As outlined above, the reduction of the unfair dismissal qualifying period to 6 months will apply retrospectively from 1st January 2027.
In addition, the statutory cap on the amount of an unfair dismissal compensatory award will be removed. At the moment, there is a cap on the compensatory award an Employment Tribunal can make of 52 weeks gross pay or £118,233 (this is likely to increase in April 2026) whichever is the lower amount. This cap will disappear completely, and at the moment we do not know what level of compensatory awards Employment Tribunals may award in the absence of a cap.
An article by Mikesh Nandha
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