Employment Rights Act 2025

by Practical Law Employment

A practice note on the significant reforms introduced by the Employment Rights Act 2025 (ERA 2025), which received Royal Assent on 18 December 2025, fundamentally altering the employment law landscape. This practice note considers the reduction of the unfair dismissal qualifying period and removal of the statutory cap on compensatory awards. It explores new rights for individuals on zero hours, low hours, and agency worker contracts, including a duty for employers to offer guaranteed hours, provide reasonable notice of shifts, and pay compensation for cancelled, moved or curtailed shifts. The note details enhanced employer obligations, such as the duty to take all reasonable steps to prevent sexual harassment, including from third parties, and new requirements for equality action plans. Key changes to the rules on dismissal and re-engagement (known as fire and rehire) are analysed, highlighting new protections for employees against restricted contractual variations. Reforms to trade unions, including the simplification of statutory recognition and new workplace access rights, are explored. Furthermore, the practice note considers reforms to the law relating to protected disclosures, collective redundancies, statutory sick pay (SSP), non-disclosure agreements, flexible working, umbrella companies, family leave and a new type of bereavement leave. For most employment-related rights, the ERA 2025 will also extend employment tribunal time limits.