Saturday, 8 November 2025

Anticipated Employment Law Changes in Autumn Budget 2025

The UK is on the brink of its most significant employment law overhaul in decades, driven by the Employment Rights Bill, expected to receive Royal Assent in late 2025 with phased implementation through 2026–27. Key reforms include:

Day-One Rights & Statuary Sick Pay

Employees will gain unfair dismissal protection from their first day of employment, replacing the current two-year threshold. Additionally, day-one entitlements will include parental leave and statutory sick pay (SSP). SSP will now be payable from the first day of sickness, and the removal of the Lower Earnings Limit will widen access to this benefit.

Family Friendly Policies

Enhanced protections will apply during pregnancy and for six months following a return to work. A new statutory bereavement leave entitlement will also be introduced, strengthening support for employees during critical life events.

Zero-Hours Contracts

Exploitative practices under zero-hours arrangements will be banned. Regular workers will be guaranteed hours, and employers will be required to provide compensation for last-minute shift cancellations.

Fire and Rehire Restrictions

Dismissal and re-engagement on worse terms will become automatically unfair except in very limited circumstances, significantly tightening rules around contractual changes.

Industrial Relations

Minimum service level rules for strikes will be repealed, and dismissal for lawful industrial action will become automatically unfair, reinforcing employee rights during disputes.

Equality and Harassment

Large employers will be required to prepare mandatory gender pay gap and menopause action plans by 2027. Additionally, a new employer duty will be introduced to prevent third-party harassment in the workplace.

Other Changes

Employment Tribunal claim deadlines will be extended from three to six months, and a new Fair Work Agency will be established to oversee enforcement and compliance.

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