Jan 2026 – What’s happening in employment in 2026?
If you thought UK employment law saw a lot of changes last year – buckle up! 2026 is going to be a rollercoaster ride…
The Employment Rights Act (the Act) just scraped through to receive Royal Assent in 2025 and several of its reforms will come into force this year. There are the normal April changes to be aware of, and we’ll probably get a major new Equality (Race and Disability) Bill.
Our dates are based on the government’s road map for delivery, unless the necessary implementation dates are already in force. These may change.
Employment Rights Act – April
Trade unions and collective consultation
The act that gives the government power to set minimum services levels in essential services during strikes was repealed as soon as the Act was passed last December.
Other trade union and collective consultation changes are expected in April 2026 such as the doubling of the maximum protective award for failing to follow collective redundancy consultation rules from 90 to 180 days’ pay per employee.
April will also see planned reforms to statutory union recognition, which will overall make it easier for unions to achieve statutory recognition in a workplace.
Electronic balloting for industrial action is expected to be introduced in April 2026, and the government has published a consultation and draft Code of Practice.
Finally, new protections for trade union representatives and members are expected in October (see below) and the government has promised to consult on them in advance. The consultation has yet to begin but is expected to start soon.
Families
Changes are on the horizon for families as well. From April, paternity and parental leave (although not shared parental leave) will become day one rights with the removal of the current service requirement. Another tweak will permit paternity leave to be taken after shared parental leave, rather than requiring it to be taken first or be lost.
Sickness
Statutory sick pay will become payable from the first day of sickness and for the first three qualifying days of sickness. And the lower earnings limit will be removed, so all eligible employees regardless of earnings will be entitled to SSP.
Whistleblowing
Disclosing sexual harassment is to be added to the list of what counts as a qualifying disclosure, making it more explicit it can amount to protected whistleblowing if it also meets the other statutory tests (such as that the individual had a reasonable belief that it was made in the public interest).
Enforcement
A new enforcement body, the Fair Work Agency, will be established in April, although it’s not clear when it will be fully operational. In time, it will take over certain existing enforcement functions for the minimum wage, the employment tribunal penalty scheme, labour exploitation and modern slavery, and employment agencies rules. It will also include a new enforcement function for holiday pay and statutory sick pay. It will have new powers and be able to charge higher penalties for not paying correct holiday and sick pay.
Other April changes
The regular increases to the hourly national living wage and national minimum wage will apply from 1 April.
| Date | NLW | 18 to 20 year old rate | 16 to 17 year old and apprentice rate |
| April 2025 (current) | £12.21 | £10.00 | £7.55 |
| April 2026 | £12.71 | £10.85 | £8.00 |
From 6 April, the weekly rate of statutory leave payments will increase (for statutory sick pay, maternity pay, adoption pay, paternity pay, shared parental leave pay, neonatal leave pay and parental bereavement leave pay). Family-related leave rates will increase from £187.18 to £194.32 a week. Statutory sick pay will increase from £118.75 to £123.25.
Employment Rights Act – October
Fire and rehire
There will be further limits on the tactic of firing in order to rehire on amended terms, which will severely impede an employer’s ability to use this method to change terms.
A dismissal will be automatically unfair if the reason is the employee does not agree to vary terms on pay, working hours, pension, shift time and length and time off – plus other terms to be defined in regulations.
A dismissal will also be automatically unfair if the reason is:
- The employer wants to impose a flexibility clause covering those changes;
- The employer intends to employ another person on varied terms to do the same role; or
- To replace the employee with agency or other non-employed workers.
The existing code of practice on fire and rehire will be updated and remain in place for terms and conditions other than these.
Harassment
Employers will be liable for third party harassment (covering all types of harassment not just sexual harassment) unless they took all reasonable steps to prevent it.
The current duty to take reasonable steps to prevent sexual harassment will also be extended to require “all” reasonable steps.
Tribunal claims
The Act was amended during its progress through parliament to extend time limits for bringing tribunal claims from three to six months.
The early conciliation period was increased from six to twelve weeks on 1 December 2025. It will be reviewed again in October to decide if twelve weeks remains appropriate.
The backlog of open claims in the Employment Tribunals now stands at over half a million claims. A major review on employment dispute resolution is due to be published in 2026, and we would expect the government to start considering significant reform.
Unfair dismissal – qualifying period and cap
Although technically outside 2026, the reduction of the unfair dismissal qualifying period to 6 months is due to happen on 1 January 2027. This will apply to anyone who has 6 or more months’ service on that date. The removal of the cap on the compensatory award for unfair dismissal may also happen on the same date (although this is currently unclear).
Employers will almost certainly be taking steps in 2026 to prepare for this major change, such as by shortening probation periods, improving and training on performance management, and implementing planned exits of higher-paid staff before the cap is removed.
Conclusion
The passing of the Employment Rights Act will only bring more proposals to be considered in 2026, as a lot of crucial detail has been left for implementing regulations. According to Peter Kyle, Secretary of State for Business and Trade, there are due to be 26 separate consultations on the Act.
This year will be an exceptionally busy one for HR, in-house employment lawyers and employers trying to stay on top of changes. And – according to the government’s road map – 2027 might be just as bad. If you’re struggling to keep up – take a look at our dashboard setting out the changes in the Employment Rights Act and our timeline setting out when we think they’ll be implemented.
If you have any specific questions you would like advice on or if you would like information about what is discussed in this article, then please contact: Abi.Frederick@lewissilkin.com of Lewis Silkin LLP.