The Employment Bill, it’s here!

The much-anticipated Employment Bill has landed—cue the fanfare! But what does it actually mean for you and your business? In truth, it’s a bit of everything and nothing. While there were early predictions of sweeping changes and even a “bonfire of employment rights,” the reality is more like a hurried piece of homework done on the bus just to meet the deadline.

Here’s a breakdown of what you need to know about the changes and what might be coming down the line.

Key Changes to Watch For

1. Statutory Sick Pay (SSP) from Day One
   One of the earliest changes expected is that employees will be able to claim SSP from their first day of work, with the removal of the lower earnings limit. This is likely to come into effect soon, so employers should be prepared.

2. Day One Rights for Unfair Dismissal
   A significant concern has been the introduction of day-one rights for unfair dismissal. The probation period will remain in place but with a “light-touch” process. This means that while employees can’t be unfairly dismissed from day one, there will be a light touch dismissal process through the probationary periods, possibly being up to nine months. This will go out to consultation and will take effect in Autumn 2026.

3. Strengthened Sexual Harassment Protections
   Employers will need to take stronger steps to prevent sexual harassment in the workplace. This means actively managing risks, providing training, and keeping records. The tricky part? Employers are also responsible for the behaviour of third parties, such as clients or contractors, especially if your business involves events or dealing with the public. This is simply an extension of the new regulations and is subject to further consultation.

4. Changes to Zero-Hour Contracts
   Despite earlier promises to ban exploitative zero-hour contracts, these contracts remain legal. However, it appears they will remain very technical and very complicated. While the details are still unclear, this will take some time to unpick and businesses should be prepared for further consultations on this topic. The government have confirmed that after 12 weeks, employees can request structured hours. This is in line with changes due to take place this year but were rescinded, again this is nothing groundbreaking. Moving forward we believe that it may be more sensible for employers to engage workers on the lowest hours they can and manage workload with additional hours. There is still a lot more to understand here.

5. Collective Redundancies
   The threshold for collective redundancies will no longer be based solely on location. This will be amended to look at redundancies taking place across the entire business. This will remove a certain amount of ‘wriggle room’ for larger employers, but the reality is with hybrid or remote working teams this has become harder to enforce, and the reality is that this is not a significant change.

6. Fire and Rehire
   The proposed legislation on fire and rehire makes it clear that this should only be used as a last resort. If you find yourself in this situation, be sure to seek professional advice.

7. Flexible Working Requests
   Employees now have an easier path to challenge denied flexible working requests, but this doesn’t mark a dramatic shift in practice. Most claims in this area tend to fall under discrimination or constructive dismissal. It can be argued that the government has done the least it is obliged to do under the manifesto. While it will be easier to make a claim they have not increased the financial settlement for this so it appears that this may not be a priority.

8. Union Recognition and Rights
   The threshold for union recognition has dropped to 10%, and employers will need to inform new employees of their right to join a union. This can be a simple addition to offer letters, but it’s something to bear in mind, particularly for larger employers.

What’s Still Under Consultation?

• Right to Disconnect: Inspired by the German model, this would allow employees to disconnect from work devices during evenings and weekends. Further consultation is needed to determine how this will work in practice.

• Single Worker Status: The government is considering simplifying the current three-stage employment model into a single worker status. Depending on where this leads this could have the furthest reaching impact as Labour try to balance exploited Gig Workers and legitimate sub-contractors.

The Fair Work Agency

One final point to note is the upcoming creation of the Fair Work Agency. This new body could have some teeth when it comes to enforcing employment rights, including the power to access business premises. While the details are still being worked out, this could mark a shift in how employment law is enforced.

The Bottom Line

While the Employment Bill marks the beginning of some important changes, the reality is that much of this is still up for consultation. The most immediate change is the right to SSP from day one, but everything else is still in flux. As always, the devil is in the detail.

If you have any questions or want to discuss how these changes might affect your business, feel free to get in touch at [email protected] or call us at 0161 843 5678.