UK Employment Law – Legislative Updates 2026 (Summary)

1. Major Reform Framework – Employment Rights Act 2025

• The Employment Rights Act 2025 represents the largest overhaul of UK employment law in decades, forming the core of the government’s “Make Work Pay” agenda.
• Implementation is phased between December 2025 and January 2027, with further consultations expected on detailed regulations and sector-specific provisions.

2. Changes Already Implemented (Dec 2025 – Feb 2026)

Industrial Action and Trade Union Law

• Minimum service level rules for strikes repealed, removing legislation that required certain services to operate during industrial action.
• Dismissal for participation in industrial action becomes automatically unfair, removing the previous 12-week limitation period.
• Ballot and industrial action requirements simplified:

• • Strike notice period reduced 14 → 10 days.
  • Industrial action mandates extended 6 → 12 months.
  • Public sector ballot thresholds removed.
  • Requirement for picket supervisors removed.

3. Key Changes Effective April 2026

Family Leave Rights

• Day-one rights introduced for paternity leave and unpaid parental leave, removing previous qualifying periods (26 weeks and 1 year respectively).
• Notice period for paternity leave temporarily reduced to 28 days.
• Bereaved partner’s paternity leave allows up to 52 weeks unpaid leave where the mother or primary adopter dies.

Statutory Sick Pay Reform

• Statutory Sick Pay (SSP) payable from day 1 of illness, replacing the previous 3-day waiting period
• SSP weekly rate increasing from £118.75 to £123.75.
• Lower earnings threshold removed, extending eligibility to lower-paid workers.

Whistleblowing Protection

• Sexual harassment disclosures classified as protected disclosures, giving whistleblowers protection against detriment and unfair dismissal.

Redundancy Consultation Penalties

• Maximum protective award for failure to consult on collective redundancy doubled:

• • from 90 days’ pay → 180 days’ pay per affected employee.

Enforcement Reform

• Establishment of the Fair Work Agency to consolidate enforcement of:

• • National Minimum Wage
  • Holiday pay
  • labour exploitation rules
  • employment agency regulations.

4. Pay and Statutory Rate Changes (April 2026)

National Minimum Wage

• National Living Wage (21+) increases to £12.71/hour.
• 18–20 rate increases to £10.85/hour.
• 16–17 and apprentice rate increases to £8.00/hour.

Statutory Family-Related Pay

• Statutory maternity, paternity, adoption and shared parental pay increases to £194.32 per week (or 90% of earnings if lower).
• Earnings threshold for eligibility increases to £129/week.

5. Additional Changes Expected October 2026

Employment Tribunal Reform

• Time limit for bringing employment tribunal claims extended:

• • from 3 months → 6 months for most claims.

Trade Union Rights Expansion

• Employers required to inform workers of their right to join a trade union.
• Trade unions gain enhanced access rights to workplaces.
• New rights for union equality representatives to paid time off.

Worker Protection and Industrial Action

• Workers participating in industrial action gain protection from detriment (not just dismissal).

Workplace Practices

• Employers must consult workers before implementing tipping policies and review policies every 3 years.

6. Forthcoming Changes (2027)

Unfair Dismissal Reform

• Qualifying period for unfair dismissal claims reduced:

• • from 2 years → 6 months employment.
• Compensation cap for unfair dismissal removed, increasing potential employer liability.

“Fire and Rehire” Restrictions

• Dismissing employees and rehiring them on worse terms will be automatically unfair in most cases.

7. Other Emerging Legislative Developments

• Planned restrictions on the use of NDAs to silence harassment or discrimination victims in employment disputes.
• Development of menopause and gender pay gap action plans, expected to become mandatory from 2027.
• Establishment of sector bargaining structures such as adult social care negotiating bodies to set sector pay and conditions.

8. Practical Implications for Employers

Key organisational impacts include:

• Increased litigation risk due to extended tribunal limits and earlier unfair dismissal eligibility.
• Requirement to update HR policies (sick pay, family leave, whistleblowing).
• Greater trade union engagement obligations.
• Potential higher redundancy liabilities and compliance costs.
• Need to prepare for new enforcement scrutiny by the Fair Work Agency.