Employment Rights Act 2025 arrives just in time for Christmas

The first of these will happen on 17 February, when most of the previous government’s trade union legislation will be repealed. Some other technical changes relating to industrial action ballots will also take effect on that date.

During the final stages of the Bill, the big surprise was the government’s decision to scrap its plans for day 1 unfairly dismissal rights. Instead, it agreed a compromise with business representatives and trade unions which involved reducing the qualifying period from two years to six months and removing the cap on the compensatory award (currently £118,223 or twelve months’ pay if lower). However, these measures are not due to be implemented until 2027.

In the meantime, there are plenty of other changes to get to grips with. For most businesses, the most significant change on the horizon is likely to be widening the scope of Statutory Sick Pay from 6 April 2026 onwards. Abolishing the waiting days and extending eligibility to lower paid workers will have a direct financial impact on employers. Other changes happening on that date include removing the qualifying periods for paternity leave and unpaid parental leave and doubling the protective award for breach of collective consultation requirements.

For the latest news on the implementation of the Act, please visit Mills & Reeve’s Employment Rights Act hub.