The Employment Rights Act 2025 brings major reforms to workers' rights, including changes to sick pay, parental leave, and bans on exploitative practices. From April 6, 2026, Statutory Sick Pay (SSP) will be available to all employees regardless of earnings and payable from the first full day of sickness absence. New day-one parental leave rights come into effect from the same date, allowing millions more workers to take time off for childbirth.
A new Bereaved Partner’s Paternity Leave will be introduced from April 6, 2026, providing up to 52 weeks of leave for partners who lose their partner before their child's first birthday. Unpaid bereavement leave will become a 'day one' right for workers. From April, fathers and partners will have a day-one right to paternity leave, and all parents will gain the day-one right to unpaid parental leave under changes from the Employment Rights Act.
Exploitative zero-hours contracts will be banned, with new rules introducing a 'Right to a Guaranteed Hours Contract' for workers who work regular hours over a reference period expected to be 12 weeks. The law keeps zero-hours contracts legal but strips away 'one-sided flexibility', and workers can choose to stay on them if they prefer flexibility. New protections include 'Reasonable Notice' for shifts and 'Cancellation Pay' if shifts are cancelled or moved at short notice.
The Act outlaws 'fire and rehire' practices.
The Act grants new powers to trade unions, including protections against dismissal for taking industrial action and easier recognition by reducing the minimum membership threshold from 10% to as little as 2%. From October 2026, trade unions will have the right to access workplaces to meet, support, represent, and recruit members on-site. A code of practice requires employers to give unions 'weekly access' to workplaces, either in person or virtually, and they must not 'listen in' to conversations.
Businesses are facing a surge of work for employment lawyers due to the Act's complexities and inconsistencies. The Act is expected to cost businesses between £1bn and £5bn per year once fully implemented. The backlog at the Employment Tribunal has reached a record high of 68,192 cases as of January 2026, up nearly 50% from January 2025.
Business groups express concerns that the Act will increase costs, hiring struggles, and disruption, particularly for retail and hospitality sectors. Businesses are required to respond to multiple government consultations on the Act, with seven consultations currently open and 25 planned overall. Business groups are concerned about how the changes will work in practice.
Four million people are in insecure work in the UK, such as on zero-hours contracts. Union membership in the UK is around 22% of workers, down from nearly 40% in 1990. Since 2020, 17 new trade unions have been set up in the UK, primarily focused on the gig economy and healthcare sectors.
Day one rights are employment protections that apply from the very first day of a job, rather than after a period of service. Many employees mistakenly believe they must pass a probationary period before they are entitled to basic legal cover. Some protections, including around discrimination and whistleblowing, have always applied from day one. Other protections, such as ordinary unfair dismissal, were traditionally only granted after a set period of employment.
The qualifying period for ordinary unfair dismissal will reduce to six months from 2027. Workers will be subject to a proposed nine-month probation period when they can still be sacked without a full process.
New protections will come into force in 2026 and 2027, with a number of important provisions taking effect in April 2026. Certain measures in the Employment Rights Bill have been criticised for being watered down or delayed. Most of the planned changes will not take effect for two years following a period of consultation.
Deputy Prime Minister Angela Rayner defended the time taken for changes to be introduced. Many employers had already brought in some of the proposed changes. This will benefit about nine million workers who have been with their current employer for less than two years.
Workers will be entitled to SSP from the first day they are ill, rather than the fourth day. Currently, workers earning less than £123 per week cannot claim SSP. The lower earnings limit for SSP will be removed but the bill will set out a lesser level of sick pay for lower earners.
Bosses will be expected to consider any flexible working requests made from day one, and say yes unless they can prove it is unreasonable. There are eight grounds they could give for refusing a flexible working request, relating to impact on the business.
Many big business groups welcomed the plans, with the CBI saying the government deserved credit for engaging with employers and unions. Women will disproportionately benefit from new workers’ rights measures rolled out from next month. The TUC said approximately 4.7 million women are to benefit from stronger sick pay from April. More than 830,000 women will receive statutory sick pay for the first time. These are the lowest-paid women, who are currently not eligible to receive sick pay because they earn below the threshold of £125 a week.
Shared parental leave, which allows parents to share up to 50 weeks of leave and up to 37 weeks of pay after the birth or adoption of a child, was introduced in 2014. New fathers can take two weeks’ paid leave at a rate of either £187.18 a week or 90% of average weekly earnings, whichever is lowest. Research last year found that mothers lose an average of £65,618 in pay by the time their first child turns five, as the 'motherhood penalty' risks their financial security. Mums in England are hit by a 'substantial and long-lasting reduction' in their pay after they have children, as they become less likely to stay in paid employment. It found women’s average monthly earnings had fallen by 42%, or £1,051 per month, five years after the birth of their first child, compared with their pay one year before the birth. This equated to a loss of £65,618 over five years, according to the analysis, which tracked pay data from 2014 to 2022.
The Fair Work Agency (FWA) has been established to enforce employment rights like minimum wage and sick pay. The national minimum wage increased on April 1, 2026, delivering a pay rise to an estimated 2.7 million people.
Reactions to the Act highlight several unknowns, including how the Fair Work Agency will enforce the new rights and what resources it will have. According to a management expert, for many firms the proposed changes won't create much of a challenge, as the government is in many cases just formalising practices that smart employers already follow. According to a business representative, smaller firms may be left scrabbling to make sense of the changes.