Cross-Border Catch-Up: The UK Employment Rights Act—Key Changes and Deadlines

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Samantha Duncan: Welcome back to the Cross-Border Catch-Up, the podcast for global employers who want to stay in the know about cutting edge employment issues worldwide. I’m Samantha Duncan, joined by my colleague, a partner in Ogletree’s London office, Justin Tarka. Today we’re tackling something that should be on the radar of every employer with operations in the United Kingdom, which is the sweeping overhaul of UK employment law under the Employment Rights Act of 2025. And this received Royal assent in December of 2025. Justin, there’s a lot to unpack here. Changes are rolling out across multiple dates this year and into early 2027. So, let’s walk employers through what’s coming and more importantly, what they should be doing right now to prepare.

Justin Tarka: That’s right. There really is a lot to consider this year and early next year. And this is really one of the most significant legislative packages the UK has seen in employment law in quite some time. And what makes it slightly tricky is not all of the changes land on the same date. They’re staggered across a few different months, including February, April, and October of this year. And then some of the most impactful provisions take effect in January 2027. What that means with so many updates hitting at different times, employers will likely see… I think the overall effect of these changes that employers will likely see an increase in tribunal claims in particular. And given how at capacity or overloaded our tribunal system already is, the unfortunate consequence may be that wait times to hear claims may even get longer, but hopefully that won’t be the case.

Samantha Duncan: Yeah, those are good observations. And I guess let’s start with what has already taken effect or is coming very soon. So, I think in February 2026, we saw changes to industrial action rules. Can you give us a quick overview of those?

Justin Tarka: Sure. So, the February changes were focused on industrial action and initially the validity of industrial action mandates has been extended to 12 months. Existing restrictions on picketing have been removed. The notice period for industrial action has been shortened to 10 days and the amount of information required in ballot notices and on ballot papers has been reduced. So for employers with unionized workforces, which is not that common in the UK, but for those that do have unionized workforces or those operating in sectors where industrial action is more common, these changes lower the procedural hurdles for unions. So, companies will want to consider reviewing their existing response plans, so to speak.

Samantha Duncan: Right. Okay. And then what about the big kind of April 2026 wave we’re kind of in right now? This is where a lot of the day-to-day HR changes land. So, Justin, can you walk us through some of those highlights?

Justin Tarka: Yeah, absolutely. So, this month has been quite packed in terms of changes. So, we have the normal annual changes relating to certain rates of pay or certain limits that apply in terms of calculating, for example, redundancy pay and so on. But in addition, we’ve had a few different changes. One of them being existing rights have essentially become day one entitlements. So, paternity leave and unpaid parental leave will no longer require qualifying service period. Employees will be eligible from the first day of employment. And then on top of that, employees will be able to take statutory paternity leave after shared parental leave or vice versa for the same child, which is a flexibility that didn’t exist before. And then for statutory sick pay, the three-day waiting period before someone becomes eligible for SSP has gone and that will now take effect from the first day of sickness. And then there used to be a lower earnings limit, which has now been removed as well.

Samantha Duncan: Okay. And it seems like that the statutory sick pay, the SSP change is one employers are really going to need to operationalize. If your payroll systems are still set up with a three-day qualifying period, employers may want to prioritize those updates now that we are into April and the removal of the earnings limit means employers aren’t going to be wondering whether they’ll see increased absenteeism and may want to check in about whether their absent management policies need tightening in response to these changes.

Justin Tarka: Yeah, exactly. And in relation to, I mentioned initially, usually we have rate changes this month. So, on that point, we have family-related leave pay increases from roughly 187 pounds to just over 194 pounds. SSP is increasing to 123 pounds and 25 pence. And the more significant change relates to workforce planning where the protective award for failure to collectively consult on redundancies, that’s actually doubling from 90 to 180 days per affected employee. So that’s quite a big one as well this month.

Samantha Duncan: Wow. Yeah. That doubling of the protective award is pretty significant. I’m thinking if an employer is contemplating any kind of collective redundancy, the cost of getting the consultation process wrong just became quite steep or steeper than it was and companies should be thinking about seeking guidance early and then building in enough lead time. I think employers might be aware that redundancy consultation in the UK can take a minimum of 30 to 45 days depending on the scope. And so, building that lead time to seek guidance seems like an important step.

Justin Tarka: Yeah, exactly. There’s also a finance bill provision expected around the same time and that would make recruitment agencies and end clients jointly responsible alongside umbrella companies for PAYE and national assurance obligations. And that’s something companies using flexible staffing arrangements will want to keep a close eye on.

Samantha Duncan: Okay. Yeah, that’s a great point. And I think then looking forward to October 2026, that brings another big round of changes. What should employers be watching for as we come into the end of this year?

Justin Tarka: They should be looking for changes which are more kind of related to workplace culture. So, one of them is that fire and rehire practices will be restricted. So very generally speaking, terminating employment and reengaging or offering to reengage an employee on new terms is kind of what should be one of the last resort kind of methods to approaching a change in terms and conditions. And that right is going to be restricted later this year. There’ll also be new protections for trade union representatives and members that are coming in, which employers should be mindful of.

Samantha Duncan: Okay. And then crucially, also in October, the time limit for bringing most tribunal claims is being extended from three months to six months. That seems like that alone could drive some increase in claim volume because employees will have more time to decide whether to bring a claim.

Justin Tarka: That’s a great point. And it’s certainly something that is predicted to add to the amount of tribunal claims that will be issued. So that’s definitely another point for employers to keep an eye on.

Samantha Duncan: Okay. And then I think let’s turn to what seems like one of the most consequential set of changes in all of this, which is the terminated related updates that will take effect in January of 2027. Justin, these are the ones that employers are really going to want to be planning for now, even though they’re still months away.

Justin Tarka: Yeah, exactly. The most significant or one of the headline grabbing changes is that from January next year, the qualifying service period for unfair dismissal claims or what we sometimes refer to as a straightforward unfair dismissal claim is being reduced from two years down to six months. So, at the moment, employees had to have two-year service before they could bring an unfair dismissal claim in certain circumstances. That’s changing to six months and that’s quite a dramatic shift. Under the current framework, employers had quite a long runway during which employees couldn’t bring that type of claim, but obviously that will change from the start of next year, which will make how probationary periods are used even more important going forward.

Samantha Duncan: Yeah, that’s a great practical tip. And I mean that in and of itself is a really big change. And then I think there’s this other change starting in January of 2027 too, which is probably equally significant and that’s the abolishment of the-

Justin Tarka: Of the cap. Yeah.

Samantha Duncan: Damages can’t be capped.

Justin Tarka: Exactly. So, now in practice it still will be based on a calculation of loss of earnings at least to some extent. But in theory from January 2027, the cap on unfair dismissal amounts which used to apply will be going away. So that’s another point for employers to be mindful of and even more reason to be careful during the process of ending anyone’s employment.

Samantha Duncan: Yeah. And I think those are great practical things to flag for employers. And I think ultimately this calls for aligning HR and legal teams on some kind of clear escalation process before termination decisions so that these points can really be thought through and I’m sure as time goes on and employers practice under them, there’ll be more clarity. But I think the kind of days of relying on the two-year qualifying period as a buffer seem to be coming to an end here.

Justin Tarka: Exactly. And another point worth bearing in mind, there’s been a creation of a new what’s called a fair work agency and that’s essentially a new enforcement body which is launching to enforce employment rights, including in relation to helping make sure that individuals are categorized properly and there isn’t misclassification, so to speak. So, that’s another point for employers to be mindful of. And I appreciate that it’s quite a lot for employers to keep track of. And that’s really the theme of this episode, which is that with this amount of change, employees need to be proactive, waiting to eat for each change to land before reacting is likely to be a recipe for headaches and compliance gaps and so on. So, it’s really important to try and keep on top of it to the extent that’s possible.

Samantha Duncan: Yeah, no, I think laying out these points is a very helpful first step for employers to be aware and I think employers coming back to these points and starting to operationalize them will help in future planning. So, thank you, Justin. That was a very helpful walkthrough for us. And to our listeners, if you have operations in the UK, now is the time to be reviewing policies, updating systems, thinking about training plans and pre-planning around processes, particularly around termination as you go into January of 2027. So, thanks everybody for joining us for today’s Cross-Border Catch-Up and thank you again, Justin. Follow us to stay in the know about cutting edge employment issues worldwide.

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