Employment, contingent workforce and immigration | UK Regulatory Outlook June 2026

Employment 

Getting ready for the Employment Rights Act reforms in 2026 and January 2027 

The next wave of reforms under the Employment Rights Act 2025 (ERA) come into force in October 2026 and January 2027. The fact that a number of the reforms are still subject to consultation and/or awaiting further detailed regulations means the task at hand is not straightforward.  

We look here at a number of the reforms including harassment, unfair dismissal, restrictions on contractual variations and the extension to Employment Tribunal limitation periods.  

October will also see new rights around trade unions, including a requirement for an employer to provide specific information on the right to join a trade union in the section one statement (the outcome of a consultation is awaited to provide further detail) and also new rights for trade unions to access workplaces (digitally and by physical attendance). Read our Insight for a closer look at what this means for employers.  

Osborne Clarke's practical tracker, setting out actions to take in the run up to the reforms coming into force, guides you through the associated actions and considerations; please speak to your Osborne Clarke contact for further details. Our microsite looks at each reform in detail including the impact and actions for consideration.  

Two new consultations published: zero/low hours workers and rights for those with caring responsibilities 

Engaging zero hours, low hour and agency workers: new obligations from 2027 

The government has published a consultation, "Ending one-sided flexibility – reforms of zero hours and similar contracts". It sets out the government's current thinking on the secondary legislation needed to give effect to the zero and low hours reforms under the ERA, covering three principal areas: a right to guaranteed hours, a right to reasonable notice of shifts, and a right to compensation where shifts are cancelled, moved or curtailed at short notice. The outcome of this consultation will shape the secondary legislation.  

Given the significance of these reforms to the way employers and hirers use staff on these contractual arrangements, businesses should ensure that they are auditing how they are currently using staff who may benefit from these changes and tracking the outcome of this consultation to understand what measures will need to be adopted.  

The measures in the ERA apply differently to agency workers compared to directly engaged workers, reflecting the nature of agency work and the relationship between agency worker, agency and hirer. Osborne Clarke's contingent workforce team looks in more detail at the consultation in relation to agency workers. 

The government has confirmed that following the consultation it will develop regulations that will provide the further, much-needed, detail on the new requirements. The consultation closes on 25 August 2026. 

Carer's leave and leave to care for a seriously ill child 

The government has also published a consultation on whether the current entitlements under the Carer's Leave Act 2023 (five days unpaid leave per year) are fit for purpose and what further measures might help unpaid carers stay in or return to work. Three options under review include: 

• Extending the current five-day unpaid leave entitlement and if so, how many additional days would be appropriate. 
• Providing a statutory "right to return" akin to that available on maternity leave and protecting an employee's role during a longer absence for caring responsibilities. 
• Providing for a short period of paid leave and, if so, the duration and rate of pay applicable. Options include setting remuneration as high as 90% pay or aligning payment with statutory sick pay rates (currently £123.25 per week). 

The consultation also looks at proposals for "Hugh's law"; a proposed leave and financial support for parents and caregivers immediately following the diagnosis of a child's serious illness. The consultation closes on 1 September 2026. 

Updated EHRC Services Code and tribunal ruling: implications for workplace facilities policies 

Two significant developments this month have added further clarity, and further complexity, to the question of single-sex facilities in the workplace. 

Updated Services Code 

Following the Supreme Court's ruling in For Women Scotland Ltd v The Scottish Ministers confirming that "sex", "woman" and "man" refer to biological sex under the Equality Act 2010, the Minister for Women and Equalities laid an updated Code of Practice on the Provision of Services, Public Functions and Associations before Parliament on 21 May 2026.  

If not rejected within 40 sitting days, the code will come into force and must be taken into account by courts and tribunals. While the Services Code applies to services rather than employment, the Minister for Equalities has confirmed that its explanation of the Equality Act (in particular around unlawful discrimination and harassment) will be relevant and helpful for employers. The code makes clear that permitting individuals to use single-sex facilities on the basis of gender identity rather than biological sex will cause service providers to lose the relevant statutory exception, leaving them exposed to sex discrimination and harassment claims. 

Tribunal ruling on facilities policy 

A tribunal has upheld claims of indirect sex discrimination and harassment brought by an employee whose employer had adopted a policy permitting trans colleagues to use toilet and changing facilities corresponding to their gender identity. The tribunal found that the employer had failed to genuinely consider alternative provision (such as gender-neutral facilities) before extending access to single-sex spaces, and that wider consultation with staff networks, including those representing women and employees with religious beliefs, had not taken place. It also held that reliance on external guidance or prevailing good practice cannot justify a misapplication of the law; independent legal advice must be sought and responsibility for compliance rests with the employer. 

Employers should review their facilities policies, carry out equality impact assessments, and consult widely with affected staff. Where single-sex facilities are provided, these should be on the basis of biological sex, but careful consideration must be given to ensuring that all employees can access toilet facilities, for example through additional provision or individual lockable rooms. The EHRC Employment Code is expected to be updated in due course, but given the time taken to finalise the Services Code, this may not be imminent. 

See our recent Coffee Break for more details. 

Contingent workforce 

Government consults on zero-hours contract reform for agency workers 

The government has published a consultation, closing on 25 August 2026, setting out its proposals for how the zero-hours contracts provisions of the Employment Rights Act 2025 will apply to agency workers. The consultation confirms that hirers will be primarily responsible for making guaranteed hours offers to qualifying agency workers, though this duty may shift to the agency in specified circumstances.  

The government's preferred hours threshold, above which agency workers would be excluded from the right to a guaranteed hours offer, is between eight and 20 hours per week. Reference period options of 12, 26 or 52 weeks are under consideration, with regularity conditions to be set out in regulations.  

On short-notice shift cancellations, agencies will be obliged to make payments directly to eligible agency workers and may seek to recoup these from hirers. The Fair Work Agency is expected to enforce the short-notice payment right, with a proposed penalty of 50% of arrears owed, subject to a minimum of £100 and a maximum of £5,000 per worker. 

Hirers and agencies should begin assessing the impact of the proposals on their contingent workforce arrangements and consider whether proposed exclusions, including the possibility of contractually guaranteed hours arrangements that meet or exceed the hours threshold, offer a viable alternative to hirers directly engaging agency workers. 

Read our Insight for more details. 

Immigration  

Nothing to report this month.