Employment law reforms on the horizon

Last updated: 21 September 2026

The Employment Rights Act (ERA) received Royal Assent on 18 December 2025 and starts a period of significant change in employment law. The government is also progressing a number of measures outside the ERA. 

The government has updated its original roadmap for implementing the different parts of the ERA. The government plans to use common commencement dates for the majority of the regulations--centred around April and October, with the exception of some measures which came into force on 18 February 2026 and the unfair dismissal and contractual variation reforms which are now planned for 1 January 2027.  

Accompanying its employment law reforms, the government is also looking to tackle economic inactivity and get Britain working. You can read more here. You can also keep track of the government's reforms on immigration.

It remains more important than ever for employers to keep track of the changes and stay ahead of what these may mean for their business. The government is now actively consulting on a number of measures set out in the ERA and in some cases we are waiting for detailed regulations to be published.  

Next Steps 

Employers will need to:

•    Consider the impact of each proposal on their existing organisation, including their cost base and employment model;
•    Prioritise specific areas of concern;
•    Identify responsibilities and key actions in preparation for the changes.

The ERA applies to England, Scotland and Wales (with some territorial deviations). 

April 2026

1 April 2026: National minimum wage rates per hour increased as follows:

• Workers aged 21 and over; an increase from £12.21 to £12.71
• Workers aged 18 to 20; an increase from £10.00 to £10.85
• Workers aged 16 to 17 and apprentices; an increase from £7.55 to £8.00

5/6 April 2026: New statutory family leave and sick pay rates:

• Statutory maternity pay will increase from £187.18 to £194.32 on 5 April 2026
• Statutory paternity, adoption, shared parental, parental bereavement and neonatal care pay will increase from £187.18 to £194.32 on 6 April 2026
• Statutory sick pay will increase from £118.75 to £123.25 on 6 April 2026.

6 April 2026: The limits that apply to certain awards in employment tribunals where the effective date of termination falls on or after 6 April 2026 are as follows:

• The limit on a week's pay increases from £719 to £751
• The maximum compensatory award for unfair dismissal increases from £118,223 to £123,543
• The minimum basic award for certain unfair dismissals (including health and safety dismissals) increases from £8,763 to £9,157
• The limit on the compensatory award for failure to allocate and pay tips fairly (or for failure to have a written tips policy or maintain records of how tips have been dealt with) increases from £5,135 to £5,366.

6 April 2026:

• Doubling of maximum protective award from 90 to 180 days' per affected employee for collective redundancy consultation failures
• Statutory sick pay payable from day one of absence and the removal of the lower earnings limit
• Statutory paternity leave and unpaid parental leave become day one rights and employees will be entitled to take paternity leave before or after shared parental leave
• A new right to bereaved partners paternity leave
• Protected disclosures expressly extended to include sexual harassment concerns; and 
  The introduction of a simplified process for trade union recognition
• Gender pay gap and menopause action plans are also expected to be introduced on a voluntary basis, with a statutory requirement taking effect in 2027 (see below).
• New umbrella company tax legislation introduces joint and several tax liability between an umbrella company and agency (or in some cases end hirers) for any failure by the umbrella company to pay full PAYE and NICs to HMRC.

7 April 2026: Establishment of the Fair work Agency.