Employment Rights Bill 2025 — The Biggest Changes to Workers' Rights in a Generation
The Employment Rights Bill — the most significant overhaul of UK employment law since the Employment Rights Act 1996 — received Royal Assent in 2025. Here is a plain-English breakdown of every major change and what it means for workers and employers in England and Wales.
Day-One Unfair Dismissal Rights
Under current law, employees must have two years of continuous service before they can bring an unfair dismissal claim at the Employment Tribunal. The Employment Rights Act 2025 removes this qualifying period entirely — from the implementation date (expected late 2026 after a consultation period), workers will have the right not to be unfairly dismissed from their very first day in employment.
This is one of the most significant individual rights reforms in decades. Employers will need to ensure that their dismissal procedures are robust from the outset of any employment relationship, not just after two years. A statutory probationary period of nine months is being introduced during which a lighter-touch dismissal procedure will apply — but dismissal must still be for a fair reason and follow a fair process.
Zero-Hours Contracts — New Rights
Workers on zero-hours contracts and those with genuinely variable hours will gain significant new rights under the Act. Employers will be required to offer a "guaranteed hours" contract to workers who have worked regularly for a 12-week reference period, reflecting the hours they have actually worked. Workers can choose to remain on a zero-hours contract if they prefer — the right is to be offered a guaranteed contract, not to be forced onto one.
Additionally, workers will have the right to reasonable notice of shifts and to compensation if a shift is cancelled or curtailed at short notice. This addresses long-standing concerns about workers being called in and sent home without pay, or having work cancelled with no financial consequence for the employer.
Flexible Working — Strengthened Rights
Since April 2024, employees have had the right to request flexible working from day one of employment (previously after 26 weeks). The Employment Rights Act 2025 goes further by narrowing the grounds on which an employer can refuse a flexible working request. Employers will need to demonstrate that refusal is reasonable — not merely that one of the eight statutory grounds exists. They will also be required to consult with the employee before refusing.
Statutory Sick Pay — Reforms
The current rules require employees to wait three "waiting days" before becoming eligible for Statutory Sick Pay (SSP), meaning the first three days of illness are unpaid. The Act removes the three-day waiting period — SSP will be payable from day one of illness. The Act also removes the Lower Earnings Limit, meaning lower-paid workers who currently earn below the threshold (£123/week in 2024/25) will become eligible for SSP for the first time. A reduced rate of SSP will apply for lower earners, calculated as a percentage of their weekly earnings.
Collective Redundancy — Extended Protections
Currently, the duty to collectively consult (for at least 45 days) applies where an employer proposes to make 20 or more redundancies at one "establishment." Courts have struggled to define what counts as a single establishment — the issue reached the Supreme Court in the Woolworths case. The Act removes the "establishment" requirement, meaning the consultation obligation applies across the whole employer wherever 20 or more redundancies are proposed, regardless of how many sites are involved.
Trade Union Rights — Major Expansion
The Act significantly rolls back the trade union restrictions introduced by the Trade Union Act 2016. Strike action ballot thresholds are reformed, the minimum service levels legislation is repealed, and unions regain the right to access workplaces for organising purposes. Employers will no longer be able to use fire-and-rehire tactics to change employment terms without going through a collective bargaining process — the Act makes it automatically unfair to dismiss and rehire (or to threaten to do so) in order to impose inferior contractual terms.
When Do These Changes Take Effect?
The Act received Royal Assent but most provisions will not take effect immediately. The government has confirmed a phased implementation with the majority of changes expected from late 2026 onwards, following statutory consultations and secondary legislation. The day-one unfair dismissal right is expected to be among the last provisions to be commenced. Employers and HR professionals should monitor the government's implementation timetable closely.