The Employment Rights Bill (ERB) is set to overhaul the UK’s employment law framework, but uncertainty continues to cloud many of its most significant provisions.
While the Bill is progressing through Parliament (currently in the final stages), much of the real detail will only emerge through secondary legislation, consultation, and future implementation. For employers, this may mean a period of uncertainty.
The following article highlights some of the critical areas and changes that will be brought about by the ERB, and raises unanswered questions alongside practical insights into why they matter and what organisations can do to prepare for what’s ahead.
- “Day One” unfair dismissal. But what does ‘light touch’ mean?
Perhaps the most headline-grabbing reform is the removal of the current two-year qualifying period to claim unfair dismissal. The proposed “light touch” process for early-stage dismissals is vague.
- How long will the “initial period” last- six months, nine months?
- What exactly does a “light touch” process entail? How will this work with the current ACAS Code and guidance?
- Will compensation for unfair dismissal during this early period be capped or reduced?
Why it matters: this reform reshapes how employers approach probation periods and performance management. Missteps could result in claims far earlier than previously expected but good policies, procedures and consistent practices will help mitigate the risk of claims in any event.
- Collective redundancy. What triggers consultation now?
The ERB redefines when collective redundancy consultation obligations arise, especially where redundancies are spread across multiple sites.
- What counts as the new threshold for triggering consultation?
- Will the 45-day consultation period for large-scale redundancies be extended to 90?
- When exactly do the new penalties kick in?
Why it matters: redundancy processes may take longer, with more potential procedural hoops to go through for legal compliance. Seeking expert advice early and ensuring a documented due process is followed will again help businesses do the right thing and be resilient to legal challenges and complaints.
- Union recognition thresholds. Where will the line be drawn?
The Bill introduces a lower threshold for union membership in a bargaining unit, potentially as low as 2%.
- What percentage will the government ultimately adopt?
- How will this be calculated in fragmented or gig-based workforces?
Why it matters: even small-scale union membership may now require employers to engage in formal recognition processes.
- Pregnancy and family leave protections. How far do they go?
The ERB includes powers to enhance protections for pregnant employees and those returning from leave but crucially lacks specificity.
- What additional hurdles will apply to dismissals during or following maternity/family leave?
- What kind of documentation or process will be required to justify dismissal?
Why it matters: these changes aim to reduce maternity and pregnancy discrimination but may complicate already sensitive processes.
- Banning NDAs in discrimination cases. But where’s the line?
A new provision restricts the use of non-disclosure agreements (NDAs) in discrimination and harassment cases.
- What will qualify as a valid (excepted) NDA?
- How will this affect existing settlement practices?
- When will the ban take effect?
Why it matters: settlement agreement and exit packages will all need reviewing.
- Zero-hours contracts. Guaranteed hours, but how exactly?
The Bill grants zero and low-hours workers the right to request guaranteed hours, but the fine print is missing.
- What counts as a “low-hours” contract?
- What is the reference period for calculating average hours—12 weeks?
- Must employers offer proactively, or only respond to requests?
Why it matters: employers using flexible contracts (including agencies) will need to review working patterns and staff entitlements.
- Shift changes. What is “reasonable” notice?
New rules around shift scheduling and cancellation are expected but the definition of “reasonable notice” remains unclear.
- Will 48 hours count as enough notice?
- What compensation is owed when shifts are cancelled late?
- Are any exceptions allowed (e.g. emergencies)?
Why it matters: rota-based sectors (for instance, in retail, hospitality, healthcare) are likely to require revised scheduling protocols—and quickly.
- Fair Work Agency. A new enforcement regulator, but with what powers?
The ERB establishes the Fair Work Agency (FWA) to enforce employment rights.
- When will the FWA be operational?
- How aggressively will it enforce non-compliance?
- Will its remit expand over time?
Why it matters: employers must prepare for direct enforcement of areas such as ensuring workers receive the right rates of holiday pay.
- Sexual harassment. New duties, but what steps are “reasonable”?
The Bill introduces a duty on employers to take “all reasonable steps” to prevent sexual harassment, including by third parties.
- What meets this threshold?
- Will compliance with EHRC guidance suffice?
Why it matters: grey areas may lead to inconsistent tribunal outcomes. Demonstrably proactive policies, which ensure employees can raise concerns or speak up without fear of repercussions, alongside good management and training are likely to be key in organisations doing the right thing and being able to evidence they have done so.
- Equality action plans. What needs to be published?
Large employers will need to publish action plans to address gender pay gaps and menopause support.
- What must these plans include?
- Are there penalties for missing deadlines or incomplete plans?
Why it matters: employers with 250+ staff will need systems for data tracking, reporting, and internal policy development.
What happens next?
The Employment Rights Bill marks a turning point in UK employment law, but it’s far from complete. In many cases, the Bill raises more questions than it answers, leaving employers uncertain about the way forward.
Implementation is expected to be phased from 2026, with some reforms (such as unfair dismissal changes) not taking effect until 2027. Before then, we can expect a series of consultations to fill in the gaps, but until that happens, preparation will need to be flexible, and based on risk awareness rather than certainty.
Join our upcoming webinar
To help employers prepare for the sweeping changes ahead, join Rob Whitaker, Partner, Michelle Brinklow of SFB Consulting and me on 23 September 2025 when we will be hosting a live webinar on these changes. We will unpack the key proposals, discuss what we do and don’t yet know, and offer practical steps businesses can take now before implementation begins.
Date: 23 September 2025
Time: 10.30AM
Whether you are in HR, senior management or legal compliance, this session will provide valuable insight and guidance on how to stay ahead of the curve.
If you need help to navigate these changes, please get in touch with our Employment Law team.
