A major reform to UK employment law is set to reshape workplace practices, with direct implications for employee wellbeing, job security and organisational accountability. The Employment Rights Act, approved in December last year, introduces changes that affect sick pay, parental leave, dismissal rights and labour supply chains.
The first phase of reforms comes into force from 6 April, with further changes scheduled for October and continuing through 2027. As the timeline advances, organisations are being urged to move beyond awareness and begin practical preparation.
Ray Walker, Director, Operational Compliance at Magnit Global, said, “The Employment Rights Act is unlike any reform we have seen in recent decades. The breadth of changes is significant, but what concerns us most is the number of organisations that are still in a passive, wait-and-see mode. April is not a rehearsal, but the start of an entirely new operating environment for workforce management.”
The scale of the reforms means employers must consider not only legal compliance, but also how policies and processes affect working conditions, employee confidence and overall wellbeing.
Key Workplace Changes
Several of the April reforms directly affect employee support and day-to-day working conditions. Statutory Sick Pay will become payable from the first day of illness, removing the existing three-day waiting period. The lower earnings limit will also be abolished, extending eligibility to workers previously excluded and setting payments at 80% of weekly earnings. This is expected to influence absence management and financial stability for lower-paid staff.
Parental rights are also expanding. Statutory paternity leave and unpaid parental leave will become day one rights, allowing employees to access support immediately upon starting a role. The removal of restrictions on taking paternity leave after shared parental leave, alongside the introduction of up to 52 weeks of unpaid bereaved partner’s paternity leave, reflects a broader shift towards recognising personal circumstances at work.
Changes to redundancy rules carry further implications. The maximum protective award for failing to meet collective consultation requirements will double from 90 to 180 days’ pay per affected employee, with potential increases to 225 days where the Code of Practice on Dismissal and Re-engagement is not followed. This raises the stakes for employers and may influence how organisational change is handled.
Compliance Risks and the Need for Clear Employer Action
Whistleblowing protections are also being extended. Sexual harassment will be recognised as a qualifying disclosure, giving employees who raise such concerns protection from detriment and unfair dismissal. This is expected to influence workplace culture, reporting practices and employee confidence in raising issues.
Another significant development concerns umbrella company arrangements. Under Joint and Several Liability rules introduced through the Finance (No. 2) Bill, organisations may be held responsible if providers in their labour supply chain fail to correctly operate PAYE or National Insurance. This shifts accountability and increases the need for oversight.
“The introduction of JSL is a fundamental change in how compliance risk is allocated across the labour supply chain,” said Nana Yeboah, Director, Global Contractor Compliance at Magnit Global. Organisations that have historically treated umbrella arrangements as an outsourced concern can no longer do so. The liability is real, it attaches to payments made on or after 6 April, and due diligence is no longer optional, but a legal and financial imperative.”