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How will the Employment Rights Act 2025 impact me?


The Employment Rights Act 2025 marks one of the biggest changes to UK employment law in decades. In our latest Haylo HR video series, we break down what the Act really means for employers, not in legal jargon, but in practical, real-world terms. Across both videos, one message is clear: UK businesses will need to rethink how they manage contracts, working hours, dismissals and employee relations over the next few years. Here’s a single, simple summary of the key points.


A Shift Towards Greater Worker Protection

The Act is designed to improve job security and fairness, particularly for workers in insecure or unpredictable roles.Key changes include:


  • Guaranteed hours for workers who regularly work more than their contracted hours

  • Advance notice of shifts and compensation when shifts are cancelled at short notice

  • Statutory Sick Pay from day one, removing the lower earnings limit


For employers, this means zero-hour and variable-hour contracts will need closer review. Businesses that rely on flexible staffing will still be able to operate, but with clearer structure and fairer treatment.


Major Changes to Dismissal and Redundancy Rules


One of the most significant areas covered in the videos is dismissal risk.

The Act will:


  • Reduce the unfair dismissal qualifying period from two years to around six months

  • Restrict the use of fire and rehire, making it much harder to change terms by dismissal

  • Increase potential compensation exposure where employers get the process wrong


The takeaway from Haylo HR is simple: process matters more than ever. Poorly handled dismissals or rushed redundancies could become far more costly. Employers also need to have a clear process for managing probationry periods given the upcoming changes relating to unfair dismissal.


Stronger Employee Voice and Union Rights


The Act also strengthens collective rights and consultation obligations.


Employers should be aware of:

  • Enhanced trade union access and consultation rights

  • Increased penalties for failing to properly consult during collective redundancies

  • Easier pathways for lawful industrial action


Even for businesses without unions, this signals a broader shift towards greater employee involvement and transparency.


Phased Introduction – Not All at Once


A key point across both videos is that these changes will not happen overnight.


Implementation will be phased between 2026 and 2027, giving employers time to:

  • Update contracts and policies

  • Train managers

  • Adjust workforce planning and budgeting


However, waiting too long could leave businesses exposed. Early preparation will be critical.


What Employers Should Do Now


Haylo HR’s advice is practical and proactive:


  • Audit employment contracts and working-time arrangements

  • Upskill managers on fair dismissal and consultation processes

  • Start planning for policy updates and system changes ahead of deadlines


Businesses that act early will be in a stronger position, legally, financially, and culturally.


Check Out our Videos


You can watch our in-depth videos with Joanna Sutton from Nockolds here;




Useful Resources




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Disclaimer

  • All information within the post is provided for guidance only; always seek your own legal advice.

  • The information with this post was correct at the time of publishing, February 2026 but may be subject to change.



 
 
 

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