How to Prepare Your Business for Employment Law Changes in 2026

The UK employment landscape is undergoing one of the most significant overhauls in decades with the implementation of the Employment Rights Act 2025. These reforms, aimed at enhancing worker protections, promoting fairer practices, and supporting modern working patterns, will be phased in throughout 2026 and beyond. Key changes are scheduled for April and October 2026, with further developments in 2027.

Proactive preparation is essential for employers to ensure compliance, minimise risks such as employment tribunal claims, and maintain positive employee relations. Staying ahead involves reviewing HR policies, updating contracts, training managers, and strengthening processes around areas like statutory sick pay, family leave, harassment prevention, and redundancy consultations.

This comprehensive guide outlines the major employment law updates in 2026, their implications, and practical steps to prepare your business effectively.

Why Preparing for 2026 Employment Law Changes Is Crucial

The Employment Rights Act 2025 introduces enhanced rights and obligations that could increase administrative burdens, payroll costs, and potential liabilities for employers. Failure to comply risks higher compensation awards in employment tribunals, reputational damage, and disputes.

Key drivers include:

Greater protections for vulnerable workers (e.g., new parents, low earners)
Stronger duties to prevent harassment and discrimination
Restrictions on practices like “fire and rehire”
Extended time limits for tribunal claims, potentially leading to more litigation

By preparing early, businesses can embed changes smoothly, foster a compliant culture, and even gain advantages in attracting talent through family-friendly and fair policies.

Key Employment Law Changes in April 2026

Several reforms take effect from April 2026, focusing on immediate entitlements and collective processes:

Statutory Sick Pay (SSP) reforms: SSP becomes payable from day one of absence (removing the three-day waiting period), and the lower earnings limit is scrapped, extending eligibility to lower-paid workers.
Day-one family leave rights: Paternity leave and unpaid parental leave become available from the first day of employment, removing previous qualifying periods.
Collective redundancy protections: The maximum protective award for failing to properly consult doubles to 180 days’ gross pay per affected employee.
Whistleblowing enhancements: Reporting sexual harassment gains explicit protection as a qualifying disclosure.
Voluntary action plans: Large employers are encouraged to develop plans addressing gender equality and menopause support (becoming mandatory in 2027).
Other early changes: Repeal of certain strike restrictions (effective February 2026) and strengthened protections for industrial action participants.

These updates could impact payroll systems, absence management, and redundancy planning significantly.

Key Employment Law Changes in October 2026

Later in 2026, further protections emphasise workplace fairness and anti-harassment measures:

Strengthened harassment duties: Employers must take “all reasonable steps” (up from “reasonable steps”) to prevent sexual harassment. Liability for third-party harassment (e.g., from customers or clients) extends to all protected characteristics under the Equality Act.
Restrictions on fire and rehire: Dismissing and rehiring employees on worse terms becomes automatically unfair in most cases, except in limited circumstances.
Extended tribunal time limits: The standard period for bringing most employment tribunal claims increases from three to six months.
Trade union enhancements: New duties to inform workers of union rights, improved access for unions, and additional protections for representatives.

Robust documentation, training, and fair procedures will be vital to defend against increased claims.

(Note: Major changes like day-one unfair dismissal rights, zero-hours contract reforms, and flexible working enhancements are expected in 2027.)

Practical Steps to Prepare for These Employment Law Updates

Start preparation now to ensure smooth implementation:

Conduct a comprehensive policy review: Update employee handbooks, employment contracts, and procedures to reflect new rules on statutory sick pay, family leave, grievances, disciplinary matters, redundancy, and harassment prevention. Align with ACAS guidance for best practice.
Audit current practices: Evaluate handling of absences, parental requests, harassment complaints, and collective consultations. Identify gaps, such as inadequate training on third-party harassment or short-term sickness management.
Train managers and staff: Deliver targeted sessions on new obligations, recognising whistleblowing disclosures, handling flexible working or leave requests fairly, and preventing harassment. This builds compliance and a supportive workplace culture.
Update payroll and HR systems: Prepare for day-one SSP eligibility, potential cost increases, and tracking enhanced leave entitlements.
Monitor developments: Follow ongoing government consultations, as details may refine. Review ACAS resources and subscribe to updates for the latest guidance.
Enhance documentation and communication: Strengthen record-keeping for redundancies, investigations, and decisions. Communicate changes transparently to employees to build trust and reduce disputes.

Regular HR audits and scenario planning (e.g., for redundancies or harassment reports) will help mitigate risks.

Common Pitfalls to Avoid During Employment Law Changes

Delaying preparation until changes are imminent
Underestimating costs of enhanced SSP or protective awards
Failing to separate voluntary action plans from mandatory requirements
Inadequate manager training leading to inconsistent application
Overlooking extended tribunal deadlines in dispute resolution

Seeking early advice on complex areas like collective redundancies or policy drafting can prevent costly errors.

Getting Professional Support for Employment Law Compliance

Many employers manage standard updates internally, but for restructurings, policy overhauls, high-risk redundancies, or defending tribunal claims, specialist expertise ensures full compliance and robust defence.

At Employment Law Services (ELS) LTD, we provide tailored employment law and HR support for employers across the UK, including Glasgow and nationwide. Our services include:

Advice on navigating 2026 employment law changes
Drafting updated HR policies and employment contracts
Training on harassment prevention and family leave
Employment tribunal representation
Fixed-fee annual retainers for unlimited ongoing guidance

Whether preparing for statutory sick pay reforms, redundancy processes, or proactive compliance, our team can help.

Contact us today for a free, no-obligation consultation. Explore more on employmentlawservices.co.uk about HR policies and procedures, redundancy advice, employment tribunal support, or our fixed fee retainer.

Stay ahead of the curve and protect your business as UK employment law evolves in 2026.