Key amendments to the Employment Rights Bill
The Employment Rights Bill is expected to introduce wide ranging reforms which will significantly change the landscape of employment law as we currently know it. In this article we identify some of the recent amendments and anticipated commencement dates for key provisions. Employers will be interested to hear that in an unexpected turn of events - perhaps the most contentious and talked about aspect of the Bill - the proposal to make unfair dismissal a day one right may not now go ahead.
What does the Employment Rights Bill do?
The reforms originally proposed under the Bill included:
- Removal of the unfair dismissal qualifying period and introduction of a statutory probationary period
- Banning (in most cases) of ‘fire and rehire’ (that is dismissing someone who refuses to agree to contractual changes and offering reinstatement on new terms)
- Removing the waiting days and lower earnings threshold for statutory sick pay (SSP)
- Introduction of a fair work agency which will have significant enforcement powers
- Compelling employers to offer guaranteed hours to zero and low hours workers at the end of each 12 week reference period, and to provide reasonable notice of shift hours/cancellation/amendments (with penalties for failure to do so)
- Requirement for employers to take all reasonable steps to prevent sexual harassment, and the reintroduction of third party harassment
- Introduction of a second threshold for collective redundancy consultation and doubling of the maximum protective award for failure to inform and consult collectively
The government roadmap
Whilst there was considerable speculation as to when the Employment Rights Bill would come into force, with fears that parts of it could be as early as October 2025, the government has recently issued a roadmap which has provided much needed clarity on the planned dates for commencement. The first of the reforms, in April 2026, are: the increase to protective awards for failure to inform and consult collectively (r.e redundancies); SSP changes; and establishment of the fair work agency. The changes to the harassment rules and the ban on fire and rehire are expected from October 2026.
The change to the unfair dismissal qualifying period, and the commencement of the fiendishly complex zero and low hours provisions are not expected until 2027.
Amendments to the original Employment Rights Bill
The government has recently proposed some amendments to the Employment Rights Bill, which the House of Lords have been debating. The big news is that the House of Lords have amended the Bill to replace day one unfair dismissal rights with a six-month qualifying period, with them voting to remove the requirement to follow a modified procedure. If this amendment were accepted by the government, this would reduce risk for employers and simplify dismissals during the first six months of employment. It would also reduce the burden on employment tribunals, which are already groaning under the weight of a grossly underfunded system. Employers should not express a sigh of relief just yet; there is every possibility that the government may reject the amendment.
One of the most notable amendments which has gotten through the House of Lords unscathed, relates to the proposed banning of the practice of fire and rehire. Under the Bill, as originally drafted, it would be automatically unfair to dismiss an employee where the dismissal was because the employee did not agree to a variation of their employment contract; or it was to enable the employer to re-engage the employee or employee someone else to carry out substantially the same duties but under varied terms. These provisions have caused significant concern because, save in exceptional circumstances where the business is at risk of insolvency, they would effectively have allowed employees to veto contract changes.
The government is now proposing to limit the scope of the provision to dismissals arising from a ‘restricted variation’. The revised Employment Rights Bill includes a list of contractual terms, variation of which would amount to such. These include changes to remuneration, pensions, hours of work, and rights to time off. The list also includes the addition of a variation clause in the employment contract of an existing employee, so it is imperative that employment contracts are reviewed to ensure that they include a well-drafted variation clause. Interestingly, the list does not include changes to place of work or duties. That means that standard relocation redundancies will continue to be governed under the ordinary unfair dismissal regime.
Under the proposals, it would be possible to dismiss an employee who does not agree to accepting changes to their contracts if the changes are ‘non-restricted’. Dismissal could nevertheless still be unfair under normal principles.
The Employment Rights Bill sets out a list of factors that employment tribunals would have to take into account in determining whether a dismissal is fair. It is clear from this list that procedural requirements (for a fair dismissal) will be far stricter, and will expect employers to consult exhaustively and offer incentives to the employee in return for agreeing to the proposed variation(s).
The proposed amendments are not all in employers’ favour however. They also include anti-avoidance provisions aimed at preventing employers from avoiding liabilities by replacing employees with agency workers or self-employed contractors.
If you are proposing to change your business model to one with wider use of agency workers or self-employed contractors, it would be wise to act quickly.
What’s next?
The Employment Rights Bill will now return to the House of Commons. As such the position is by no means settled. We are keeping our ears close to the ground, and will share updates on significant developments via our website and email bulletins. If you are not already on our mailing list, please get in touch to sign up to receive them. For more information on our Employment services, please visit our service pages for Senior Executives and Businesses.