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Home / News / The Employment Rights Bill 2025: Update on proposed reforms impacting employers and employees

The Employment Rights Bill 2025: Update on proposed reforms impacting employers and employees

7 April 2025

The Employment Rights Bill 2025 (ERB) was introduced in October 2024 and proposes broad reforms to employment law. It will impact the rights of employees, as well as increasing expectations of employers to protect and respect those rights.

Angela Raynor has publicly supported the bill stating that the ERB has the full backing of the cabinet. In light of a recent House of Commons progress briefing on the bill,  we take a look at the ERB and consider some of its key proposals.

What reforms are proposed by the ERB?

The ERB covers a wide area of employment law and the comprehensive reforms it proposes are set to impact all industries and businesses. It is considered one of the largest increases in employment rights in a generation. These reforms include changes to unfair dismissal, flexible working, statutory sick pay, family leave and harassment protection to name a few.

Zero-hour contracts: the ERB proposes several amendments to regulation of zero-hour contracts. This includes rights for reasonable notice of shifts, payment for cancelled shifts at short notice, and guaranteed hours reflecting regular hours worked.

Flexible working: the ERB seeks to update how flexible working requests are handled by employers. Currently, employers can refuse requests for flexible working on a list of statutory grounds. Whilst the ERB will maintain this list, it will  introduce a requirement that a refusal on those grounds be reasonable. A requirement will also be introduced for employers to explain their reasons for refusing such a request.

Statutory sick pay: currently employees are paid statutory sick pay for each day they would work, after the first 3 days. These 3 days are known as the ‘qualifying period’.  The ERB proposes to remove the qualifying period, meaning employees could be eligible for statutory sick pay earlier.

Family related leave: changes to family related leave (such as parental leave, paternity leave, and bereavement leave) include removing the Secretary of State’s power to set a qualifying period for unpaid parental leave. Parental leave would become a day one right. There are also proposals to expand the number of eligible relationships for bereavement leave.

Protection from harassment: the protections introduced by the Worker Protection (Amendment of Equality Act 2010) Act 2023, established a duty for employers to take ‘reasonable steps’ to protect employees from sexual harassment by third parties such as customers and suppliers. The ERB proposes to expand this duty requiring that employers must take ‘all reasonable steps’ to protect their employees. Therefore, extending liability to employers that failed to take such steps.

Unfair dismissal: currently unfair dismissal in the UK (being dismissed without fair reason, not following a fair procedure for dismissal, or the reason for dismissal was insufficient) requires an employee to have worked for the employer for 2 years before they qualify for protection. The ERB proposes to remove the 2-year qualifying period. Exceptions are included in the ERB for dismissals during an initial period of employment, with the exact period to be determined in future regulations.

Recent developments

The ERB had its second reading before the House Commons on 21st October 2024. Since then, the ERB has entered the public committee stage where the bill has been examined, and evidence has been heard from stakeholders across 21 sittings. 149 amendments were proposed to the ERB, with some of the most significant discussions of the bill including:

  •  Increasing the time limit for which a person can make a claim to an employment tribunal from 3 months to 6; and
  • Discussions as to whether smaller businesses should be exempt or partially exempt from the reforms.

Other recent developments include the Business and Trade Select Committee (BTSC) inquiry into the ERB. The BTSC held four consultations looking into the 4 following areas:

  1. Strengthening Statutory Sick Pay
  2. Strengthening Remedies against breaking rules in respect of collective redundancy, and firing and rehiring practices
  3. Establishing a modern framework for industrial relations
  4. Application of zero-hour contracts to agency workers

The government is considering its responses to the BTSC and is expected to propose its own further amendments in due course.

Next steps

The ERB is currently in the report stage in the House of Commons, with the next stage being the third reading. This is the last chance for the bill to be debated in the House of Commons. If the bill is approved, it will go to the House of Lords where it will be scrutinised and debated. If the bill is passed by the House of Lords, it will be submitted for Royal Assent and will become law.

The proposals in the ERB are not yet law but it is advisable  that both employers and employees remain aware of the proposed legal changes.  If you require any guidance on what this bill may mean for your business or for you as an employee, please contact our employment team who will be happy to assist you.

This article was written by Redkite Solicitors, Harry Kersey. To find out more about Madeleine and the support that she can provide to you, visit her website profile here: https://www.redkitesolicitors.co.uk/team/harry-kersey/

 

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.