Employment
Becci Collins
July 2025
What happens next?
It is anticipated that six months after the Bill receives Royal Assent and the first amendments are implemented, the second wave of changes will take place. These changes will have a substantial impact on how employers manage the day-to-day operations of their businesses.
Collective Redundancy
Currently, when an employer proposes to make 20 or more employees at one establishment redundant within 90 days, it must comply with the requirements of collective consultation. A failure to do so could result in a protective award of up to 90 days’ pay.
From April 2026, the protective award is expected to double to 180 days’ pay, per employee. The increased costs on employers for failing to comply with legislative requirements are hoped to reinforce that compliance is not optional. Redundancy, especially collective redundancy, remains a complex area of employment law. Proactively seeking legal advice proactively is essential to ensure legal compliance and protect the business.
‘Day one’ paternity leave and unpaid parental leave
The current law requires employees to have one complete year of service to be eligible for parental leave and 26 weeks (assessed 15 weeks before the expected birth week). The Bill proposes removing the qualifying period so that the entitlement to leave becomes a right from the first day of employment. As more and more individuals become entitled to leave from the first day of employment, businesses will need to review how they operate on a day-to-day basis to ensure that these periods of leave do not adversely affect their staff by increasing their workload to unmanageable levels.
Whistleblowing protections – Sexual harassment
In October 2024, employers were required to take steps to prevent sexual harassment.
The Bill will introduce a protection for those who make disclosures of sexual harassment. By making disclosures about sexual harassment that has occurred, is occurring or is likely to occur a ‘protected disclosure’, the Bill protects those who make such disclosures from detriments, up to and including dismissal, under whistleblowing protections. Any dismissal in retaliation for making a protected disclosure shall remain automatically unfair.
Fair worker agency
The minimum standards to which employees are entitled are currently governed by their respective authorities. For example, HMRC monitors if employers are paying the national minimum wage.
From April 2026, we expect to see the introduction of an independent enforcement body, the Fair Worker Agency (‘the Agency’). The powers of the Agency will extend beyond merely enforcing the minimum standards to which employees are entitled. It shall also have the power to bring proceedings in the Employment Tribunal for employees who are unwilling to, or unable to, themselves. Throughout litigation, the Agency will provide legal assistance, support or representation to litigants in person. Where the Agency brings or assists in a successful claim, it shall be able to recover its costs from the employer.
The introduction of the Agency aims to improve business compliance with employment legislation. Employers’ practices will be under more scrutiny than ever, as individuals become increasingly educated about their rights and entitlements. Businesses should conduct regular HR audits to ensure they remain compliant with the ever-evolving employment laws.
Statutory sick pay
Currently, employees are only eligible for Statutory Sick Pay (SSP) if they meet the following eligibility criteria:
- earn an average of at least £125 per week; and
- are ill for more than three days in a row (including non-working days).
The proposed changes will result in more employees being eligible. For the first time, all workers will be entitled to SSP, as the lower earning threshold has been removed, along with the three-day waiting period. Individuals will be entitled to SSP from their first day of illness, provided they are ill for two or more consecutive days. Therefore, the costs to employers will increase – prudent employers will be vigilant about workload and workplace practices that contribute to illness, in order to prevent individuals from becoming sick. They will also need to review their long-term absence policies and take proactive steps to facilitate a return to work.
Trade union measures
To modernise the balloting of union members and streamline processes, the bill will introduce ‘e-balloting’ and make the preferred use of electronic mail. The hope is that by improving efficiency, trade unions shall be able to provide improved and quicker support for their members.
If you would like more advice on the changes brought by this Bill and your obligations as an employer, please contact our Employment team
