Employment Rights Bill: Key Changes and What Employers Need to Know

The long-awaited Employment Rights Bill is finally gaining momentum, and while we’re still a way off from it becoming law, the government has just given us a clear glimpse into what the future of UK employment legislation might look like. If you’re an employer, these proposed changes aren’t just important – they could significantly impact how you hire, manage and retain your employees.

Here’s a breakdown of the most eye-catching amendments announced this month and what they could mean for your business:

1. Zero-hour & agency workers: a shift towards guaranteed hours

One of the most talked-about proposals is a new right for zero-hour and agency workers to request a contract with a guaranteed minimum number of hours per week. The idea is to tackle the perceived exploitation of unpredictable work patterns – something the government is keen to phase out.

While the hiring company will be responsible for offering these guaranteed hours, agency workers will remain technically employed by their agency. Crucially, if a shift is cancelled at short notice, the worker will still need to be paid – likely by the agency, which can then recover the cost from the hirer. The specifics around what counts as “short notice” are still being ironed out but this change could introduce new financial and administrative considerations for businesses relying on flexible labour.

2. Statutory sick pay (SSP): a boost for low-paid workers

Another proposed shift is a revision of SSP rules, especially for lower-paid employees. SSP would now start from day one of illness (rather than day four), and employees would be entitled to either 80% of their normal pay or the standard SSP rate – whichever is lower.

This change is intended to prevent “presenteeism,” where workers turn up sick simply because they can’t afford time off. For employers, it’s a reminder to revisit sickness absence policies and ensure payroll systems are ready to accommodate the change.

3. Fire and rehire: heavier penalties for non-compliance

The government is sending a message with this next amendment: ignore redundancy consultation rules at your peril. Inspired by the infamous P&O Ferries saga, the Protective Award cap for non-compliance with redundancy consultation requirements is set to double – from 90 days’ pay to 180 days’ pay.

This could become a significant financial risk for any employer considering restructuring without the proper procedures in place. If you weren’t already taking collective consultation seriously, now is the time to start.

4. Bereavement leave for miscarriage: a compassionate extension

Though not yet formally confirmed, it’s expected that the Bill will include a new entitlement to two weeks of statutory bereavement leave for parents who experience a miscarriage before the 24-week mark. This is a compassionate addition that recognises the emotional toll of early pregnancy loss and would apply to both the mother and her partner.

What’s next?

The Bill is currently moving through the House of Commons and will then proceed to the House of Lords. Once all parliamentary stages are complete, it will return to the Commons for final approval before receiving Royal Assent. Realistically, none of these changes will likely come into effect before 2026 – but now is the time for employers to prepare.

Let’s get your business ahead of the changes

At MAD-HR we help you stay compliant, proactive and people-focused. From reviewing your contracts to updating policies and training your managers, we’re here to help you adapt confidently to the evolving employment landscape.

Don’t wait for legislation to catch you off guard. Let’s futureproof your business together – because staying compliant doesn’t have to be complicated and supporting your people shouldn’t be a headache.

Contact MAD-HR today to see how we can support your business before these changes come into force. Together, we can turn compliance into a competitive advantage for your business.