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ARTICLE ORIGINALLY PUBLISHED January 2026

Employment Rights Act Update

Consultation continues till January 2026 on:

enhanced protection for pregnant women and new mums
We know the right to claim unfair dismissal will reduce from 2 years to 6 months
Protection for new mums from redundancy might extend to 6 months from their return date detail to follow
The detail re SSP changes

The changes also announced are:

The LEL will be deleted LOWER EARNINGS LIMIT
Parental leave will become a day 1 right from April 2026
Zero hours/agency after 12 weeks regular hours they will be able to require equivalent hours and a contract
There is likely to be compensation for cancelled shifts
Employers will be required to keep as record of holidays taken and payment for 6 years
FROM APRIL 2026 the penalty for getting redundancy wrong will increase from 90 days protective award to 180 days ie 6 months
The old fire and rehire will effectively disappear

THE TIPPING RULES ARE GOING TO BE REVIEWED

Employers will have to advise employees of their right to join a trade union—it is suggested from day 1 ie a contractual right. In 2027 the cap on unfair dismissal pay outs will go. And there will be guidance on bereavement leave. On top of pregnancy bereavement leave that already exists

Employment rights bill to become law

Hailed as the ‘biggest upgrade to workers’ rights in a generation’, the reforms promise day-one rights and stronger employee protections.

The bill introduces a number of reforms aimed to tackle insecure work and strengthen protections from day one of employment, including access to statutory sick pay, paternity leave and new safeguards for pregnant women and new mothers.

Other measures include a ban on zero-hours contracts, expanded parental and bereavement leave, stronger protections for whistleblowers and tougher demands on employers to prevent sexual harassment.

The day 1 right to claim unfair dismissal has been changed to 6 months. This is expected to come into force from January 2027 and apply retrospectively to anyone who has completed at least six months in employment by then.

Employment Rights Bill - probation period

Employees with 6 months service at 1st January 2027 will now be able to claim unfair dismissal.

ZERO HOURS WORKERS - WHAT’S CHANGING?

If you employ people on zero-hours or very low guaranteed hours The Employment Rights Bill will make significant changes.

1. RIGHT TO A CONTRACT WITH GUARANTEED HOURS

If a worker regularly works the same hours over time, they’ll gain the right to request a contract that reflects those actual hours.

A reference period (likely 12 weeks) will be used to assess this.
So, if someone consistently works 20 hours per week over 3 months, you must offer them a 20-hour contract.
They can choose to decline and remain on zero-hours. The choice is theirs, not yours.

2. RIGHT TO REASONABLE NOTICE OF SHIFTS

Employers will be legally required to give “reasonable” advance notice of shifts or work schedules.

(a 7-day notice period is likely to be the default).
Workers can refuse these last-minute shifts – and possibly seek a remedy through a tribunal.

3. RIGHT TO COMPENSATION FOR LAST-MINUTE CANCELLATIONS

If you cancel or cut short a shift on short notice, you’ll owe the worker compensation.

Details will be set in regulations, but expect partial pay for cancelled shifts.
The same protections apply to temporary and agency staff.
If an agency worker regularly works the same hours for a client, that client must offer them a guaranteed hours contract.
Agencies must also give reasonable shift notice and pay for short-notice cancellations.

END OF CAP FOR UNFAIR DISMISSAL CLAIMS

The government has just announced plans to remove the cap on compensatory awards for ordinary unfair dismissal.

This brings unfair dismissal in line with discrimination claims where there is no cap.

UNFAIR DISMISSAL -CHANGES TO COMPENSATORY AWARD

Currently the compensatory award for unfair dismissal is capped. If an employee wins an ordinary unfair dismissal claim, a tribunal can award lost earnings up to a statutory maximum. As of now, that maximum is 52 weeks’ pay or £118,223, whichever is lower.

This cap has been in place for decades. It was £12,000 in 1999.

Older employees, even on moderate incomes, can suffer very large losses if they’re pushed out unfairly. One likely outcome is that employers will dismiss more willingly within the first six months. The removal of the unfair dismissal cap is a major development

EMPLOYERS

Must from April 2026 take all reasonable steps to avoid sexual harassment and this will include third parties i.e. customers.

I don’t provide a sexual harassment policy but in the bullying verion I say the following and you may wish to adopt it.

Harassment by Third Parties

In the event that an employee feels that he/she is being harassed by either a client or an employee from another company, employees are encouraged to report such incidents.

SSP

Will become a day 1 right from April 2026

The Lower earnings limit will go currently the rule is employees have to be earning an average of at least £125 per week to qualify for SSP. And it will be payable from day 1 not day4. I will start amending contracts as and when the details are confirmed

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