After months of scrutiny, debate and political back-and-forth, the Employment Rights Act 2025 (ERA 2025) is now law, following Royal Assent on 18 December 2025. While this is a significant milestone, the practical impact for employers will be felt over time rather than overnight. Most reforms will be introduced in phases across 2026 and 2027, giving organisations a limited but valuable window to prepare.

The provisions set out in the ERA 2025 will affect workforce strategy, cost exposure, and litigation risk. Some sections take effect automatically, while others require consultations, impact assessments, and guidance before they are implemented. The only provision effective immediately is the repeal of the Strikes (Minimum Service Levels) Act 2023, restoring the previous legal position for strike management in certain public services.

Key changes to anticipate

February 2026:

• Industrial action balloting changes
• Trade union financing reforms

April 2026:

• Statutory sick pay from day one and removal of the lower earnings limit
• Day one family leave rights, including paternity and unpaid parental leave
• Increased penalties for collective redundancy consultation failures
• Stronger whistleblowing protections, including complaints about sexual harassment
• Trade union reforms, including electronic and workplace balloting
• Establishment of the Fair Work Agency, with powers to enforce employment rights

October 2026:

• Restrictions on ‘fire and rehire’ practices
• Duty to prevent harassment, including third-party harassment
• Employment Tribunal time limits extended from three to six months
• Expanded trade union access and information duties

2027:

• Reduced qualifying period for unfair dismissal from two years to six months
• Removal of compensation cap for unfair dismissal
• Gender pay gap and menopause action plan requirements for larger employers
• Enhanced pregnancy protections
• Flexible working: new “reasonableness” test for refusals and guaranteed hours obligations

Steps employers should take now

Early preparation is crucial to avoid compliance gaps, unnecessary costs, and operational disruption:

• Review policies on sickness, family leave, harassment, and flexible working
• Assess workforce impact and costs of new SSP and unfair dismissal rules
• Factor changes into 2026–27 workforce planning, particularly for restructuring or redundancies
• Plan training and communications for managers and HR teams
• Monitor consultations, guidance, and commencement regulations as they are released

Ensure your teams are ready with Vista

Vista Employer Services provides tailored compliance training and support to help employers turn ERA 2025 into practical action. Our programmes equip HR teams and managers to implement new policies effectively, reduce risk, and stay ahead of legislation.

If you want guidance on how you can adjust your company policy in a compliant way, contact Vista Employer Services or call us on 0330 053 9345.