UK Employment Law Coffee Break: Acas conciliation limits, EU Pay Transparency Directive, and Budget Day

Acas early conciliation period increased to 12 weeks

Statutory regulations have been made increasing the early Acas conciliation period from six weeks to 12 weeks in response to demands on Acas and the increasing complexity of cases. The increase will apply to any case notified to Acas for early conciliation on or after 1 December 2025. For such claims, where no settlement is achieved, Acas must issue an early conciliation certificate bringing the process to an end and which will then enable an individual to lodge a claim formally in the Employment Tribunal.  

The limitation clock stops during the conciliation period, meaning that claimants will have longer overall to bring their claims and more time to strengthen and prepare for any claim. Employers will need to adopt a balanced approach: while from 1 December they will have a longer period in which to engage meaningfully with conciliation and potentially move towards a resolution, they will also need to manage the practical and financial implications that a longer pre-claim process can give rise to.

EU Pay Transparency Directive due to be implemented

The EU Pay Transparency Directive is due to be implemented across EU Member States by 7 June 2026. The directive marks a step change in how EU employers will be required to manage and communicate pay. It introduces far-reaching obligations, including pre-employment pay transparency, objective and transparent pay setting and progression criteria, employee rights to information on individual and average pay by gender for comparable roles, and gender pay reporting potentially giving rise to a need to carry out joint pay assessments.

On our dedicated EU Pay Transparency Directive hub, we look at its requirements, the challenges it gives rise to, and the steps organisations should start taking now to prepare. We also track where Member States are currently on their implementation journey and how the directive's requirements may operate in practice.

We are currently working closely with employers across jurisdictions to prepare for the implementation of the directive. While some countries are moving faster than others in progressing their national laws, all employers should act now to ensure a culture of transparency and accountability in the workplace, through measures such as auditing pay to identify gaps, implementing transparent pay and progression frameworks, building robust reporting mechanisms, and engaging with works councils or employee representatives.

For international organisations, strategic consideration will need to be given as to how implementation in one jurisdiction will have an impact on another and whether a harmonised approach in some aspects should be adopted.

Please contact your usual Osborne Clarke contact or one of our international team who will be happy to discuss the impact of the directive for your organisation and how we can support you.

Autumn Budget 2025: speculation of increasing employment costs but improvements ahead for EMI options?

As the government seeks to raise revenue, there is increasing speculation that the budget on 26 November 2025 will deliver further significant costs to employers through increased wage costs and national insurance reforms directed at partnerships and LLPs. Chancellor Rachel Reeves has also not ruled out a potential hike in income tax, despite the government's manifesto commitments otherwise, alluding to the need to make "necessary choices" in the Budget after the "world has thrown more challenges our way". See our earlier Insight.

However, there are rumours that the Enterprise Management Incentive (EMI) regime is in line for a possible Budget Day boost, with suggested higher plan limits and a reduced administrative burden for UK start-ups and scale-ups. We will have to wait for Budget Day to see what is announced, but the direction of travel looks encouraging for this much valued tax-advantaged plan.

EMI remains one of the most effective ways to recruit, retain and align key talent. When properly structured and operated, EMI can deliver shares to employees without income tax or national insurance contributions (NICs) on exercise and allow gains to be taxed at favourable capital gains tax rates, subject to qualifying conditions.

Rumours of what may be seen include increased limits on the amount of value that can be delivered to qualifying employees (currently £3 million per company; £250,000 per employee). There have also been calls for an increase in the qualifying company limits (in particular, increasing the current £30 million gross assets test and 250 employees limit).

If implemented, these changes would broaden access to EMI for a range of businesses and make this an even more powerful growth tool.

What does this mean for employers?

Rumours are likely to intensify in the run-up to Budget Day; however employers will ultimately need to wait for formal announcements to understand the full picture and the impact on wage costs, be it directly or indirectly.

For employers with EMI schemes, practical steps to consider include reflecting on the current incentive offering and considering whether it is delivering the desired outcomes and reviewing the option pool and headroom. Tailored advice is the best way to ensure your EMI scheme is compliant, effective and aligned with your strategy. Now is a great time to develop your current incentive arrangements to ensure these support your next phase of growth.

Our legal teams will be monitoring Budget Day and sharing insights on any announcements made on EMI and other tax-advantaged plans, as well as other proposals affecting employers. Please speak to your usual Osborne Clarke contact, or partner Michael Carter in our incentives team, to discuss the implications for your business.