Employment Rights Bill (ERB): The Key Changes Employers Need to Know

The Employment Rights Bill (ERB), introduced on 10 October 2024, is the first big step in the government’s Plan to Make Work Pay, a major push to modernise UK employment law. It’s expected to become law very soon, likely in November, with changes rolling out between 2025 and 2027. In this post, Acumen Law's employment law solicitors will walk you through the key updates and what they mean for your business, so you can stay ahead and plan with confidence.

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1. Day-one protection from unfair dismissal, with a statutory probation period

The Bill removes the 2-year qualifying period for ordinary unfair dismissal, making protection a day-one right. To balance this, the Bill introduces a statutory probation period (the government’s preferred length is 9 months) during which a lighter-touch process can be used for dismissals where someone is not right for the role. Tribunals may apply a lower compensation cap for dismissals during this statutory probation period. Implementation is expected in 2027, subject to consultation and final parliamentary tweaks. There has been debate in the House of Lords about a shorter 6-month qualifying period, but the government’s stated policy remains day-one protection plus a statutory probation regime.

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What to do now: map your onboarding and probation processes to a9-month framework, write a simple, fair dismissal process for the statutory probation window, and train managers.

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2. "Fire and rehire”: from last resort to tightly-restricted

Under the Bill, a dismissal connected to forcing contract changes will be automatically unfair unless the employer can show genuine financial difficulties, that the changes eliminate or significantly mitigate those difficulties, and that the change was unavoidable, all alongside proper consultation. Subsequent amendments in mid-2025 further focused this on “restricted variations” (for example pay, pensions, working time/shift patterns, annual leave and similar), with implementation expected in October 2026 after consultation.

What to do now: plan restructures early and avoid relying on dismissal/re-engagement unless you can evidence genuine viability risks.

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3. Preventing harassment from “reasonable steps” to all reasonable steps, plus clearer rules

Since 26 October 2024, employers already have a proactive duty to take reasonable steps to prevent sexual harassment. The ERB raises that bar to all reasonable steps and gives ministers power to make regulations specifying steps employers must take (for example risk assessments, policies, training and reporting routes). The government also plans to restore and extend third-party harassment protections, with the new duties expected to take effect in October 2026.

What to do now: refresh your risk assessment, policy, training and reporting systems; keep board minutes evidencing active oversight; and audit supplier and client-facing risks.

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4. Zero-hours and insecure work: guaranteed hours, notice of shifts and cancellation pay

Eligible workers will have aright to be offered guaranteed hours reflecting their actual pattern over a reference period (expected to be 12 weeks, set by regulations). Employers must give reasonable notice of shifts and pay compensation if shifts are cancelled, curtailed or moved at short notice. Workers can reject guaranteed hours and stay on a zero-hours contract if they wish.

What to do now: analyse scheduling data, design an internal “guaranteed hours” offer process, and budget for short-notice cancellation payments.

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5. Flexible working: keep requests unless refusal is truly reasonable

Employees already have a day-one right to request flexible working. The ERB keeps the request/response model but tightens it so employers can refuse only where it is reasonable based on the eight statutory grounds, must follow a set consultation process, and must explain why refusal is reasonable. The effect is a presumption towards agreement where feasible.

What to do now: standardise a short consultation script, record objective feasibility assessments, and publish a plain-English policy.

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6. Statutory Sick Pay: day-one entitlement and broader coverage

The Bill removes the Lower Earnings Limit, brings in day-one SSP (no waiting days), and pegs the rate to 80% of normal weekly earnings or the flat rate (whichever is lower). SSP enforcement moves to the new Fair Work Agency.

What to do now: update payroll rules, sickness policies and manager guides, and budget for earlier SSP liabilities.

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7. Family leave: bereavement leave, and day-one paternity and unpaid parental leave

There will be a new statutory Bereavement Leave right (details to come in regulations, with a minimum of 1 week and a window of at least 56 days after the death). Paternity and unpaid parental leave become day-one rights (notice periods remain the same), and the bar on taking Paternity Leave after Shared Parental Leave is removed.

What to do now: align policies and train managers on notice requirements and eligibility from day one.

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8. Collective redundancy: wider trigger and stronger remedies

Consultation duties will be determined by the number of employees affected across the business, not just at a single establishment, with a new organisation-wide trigger to be set by regulations. The maximum protective award doubles from 90 to 180 days where consultation duties are breached; seafarer notification rules are also tightened.

What to do now: review group-wide redundancy playbooks and data-gathering to capture impacts across sites and entities.

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9. Whistleblowing, NDAs and equality action plans

Disclosures about sexual harassment will explicitly qualify for whistleblowing protection, removing doubt about coverage. The government has also announced plans to curb the use of NDAs that silence victims of discrimination and harassment (commercial confidentiality NDAs remain permissible), and to require large employers to publish gender-equality action plans and disclose key outsourcing relationships in gender pay reporting. Final wording will sit in secondary legislation.

What to do now: update settlement templates and NDA wording, map whistleblowing routes to cover harassment disclosures, and prepare for action-plan reporting if you have 250 or more employees.

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10. Tribunal time limits move from 3 to 6months

Time limits for most employment tribunal claims are expected to increase to 6 months, with commencement currently signposted for October 2026 (subject to the final Bill and regulations). Budget for longer claim windows and preserve evidence accordingly.

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11. Enforcement: the Fair Work Agency

A new Fair Work Agency will consolidate state enforcement (for example minimum wage and agency rules) and take on additional areas such as holiday pay and SSP. Expect a single enforcement brand with stronger investigatory and penalty powers, plus the ability to bring or support tribunal cases.

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When do the changes start?

The government’s factsheets and subsequent updates point to a phased roll-out through 2025 to 2027. Many items (for example harassment regulations, zero-hours reforms and tribunal time limits) are targeted for 2026, while day-one unfair dismissal is widely expected in 2027 after consultation on the statutory probation regime. Keep watching for secondary legislation and updated Acas guidance as details crystallise.

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Practical next steps for employers

Start with a short, focused compliance plan. First, audit contracts, handbooks and manager guides for dismissal, probation, flexible working, sickness and leave. Second, risk-assess harassment and document all reasonable steps you will take, including third-party risks. Third, interrogate rosters and agency usage so you can offer guaranteed hours and manage cancellation payments. Fourth, plan for 6-month limitation periods by tightening document retention and note-taking. Finally, rehearse consultation playbooks for restructures to avoid falling into a “fire and rehire” trap.

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FAQs

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1. Is day-one unfair dismissal definitely coming?

Yes. That is the government’s policy, but the exact mechanics (length of statutory probation, lighter-touch process, and any compensation cap in that period) remain subject to consultation and final legislation. Current timelines point to 2027.

2. Will “fire and rehire” be banned?

Not outright. The Bill makes dismissals tied to certain “restricted variations” automatically unfair unless a strict financial-difficulty test is met, with implementation expected in 2026. Ordinary variation proposals outside the restricted list still require proper consultation and fairness.

3. What exactly changes on harassment?

You already have a duty, since 26 October 2024, to take reasonable steps to prevent sexual harassment. The ERB raises this to all reasonable steps and will let ministers specify required steps in regulations. Expect third-party harassment coverage to be strengthened in 2026.

4. Do we need to change our flexible working policy?

Yes. You will need to consult using a specified process and give reasoned refusals. In practice, assume requests should be accepted unless they are genuinely not feasible on one of the statutory grounds.

5. Are tribunal time limits really doubling?

That is the policy trajectory and employers should plan on the basis that most claims will move to a 6-month window, likely from October 2026, subject to final regulations.

Need a hand?

Acumen Law’s employment team can review your contracts, policies and processes and give you a concrete plan to get ERB-ready with minimal disruption. If you want us to sense-check your risk areas or run a short manager workshop, we can schedule that quickly.

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