March 2026

Employment Rights Act 2025: what changes have already taken effect?

The first tranche of changes under the Employment Rights Act 2025 came into effect on 18^th February. Whilst we will have to wait for April, October and, in some cases, 2027 for many of the ‘big ticket’ employment law changes under this extensive piece of legislation, it’s important to acknowledge the changes which have already come into effect. In particular:

The requirement that at least 40% of all workers eligible to vote in the bargaining unit voted for industrial action in important public services industrial action ballots will be removed.
The required notice that trade unions must give to employers before taking industrial action will be reduced from 14 days to 10.
The time limit during which a successful industrial action ballot remains valid will be increased from six months (or nine months with employer agreement) to 12 months. This will give trade unions more time in which to act on a strike mandate and organise their members/increase pressure on employers.
The reduction in the amount of information unions are required to include on ballot notices, ballot result notifications and notices to employers of industrial action. This includes removing the requirement to detail the number of employees in each category or workplace.
Picket supervisors will no longer be required.
Trade union members will be automatically opted in to a trade union’s political fund, although they will maintain the right to opt out.
The protected period (broadly, the first 12 weeks of industrial action) for automatic protection for employees from unfair dismissal for taking part in protected industrial action will be removed. This means that this protection will apply irrespective of the length of the industrial action.

These changes are all trade union focused. However, given the Employment Rights Act 2025’s clear move towards greater trade union influence in the workplace and simplified recognition processes, it is important that all employers (and not just those with a currently recognised trade union) are aware of them.

Action short of dismissal: choosing the right lever (and keeping it lawful)

When performance or conduct concerns escalate, dismissal can feel like the cleanest option. In practice, premature termination is often the highest-risk outcome: it can trigger unfair dismissal exposure, damage reputation, and sacrifice institutional knowledge. Action short of dismissal is frequently the smarter route—but only where HR deploys it proportionately, procedurally, and within contractual boundaries.

The starting point is legal authority. Most “lesser” sanctions fall into two buckets: (1) steps the contract already permits; and (2) steps that require employee consent. That distinction is not technical—it is decisive. If an employer imposes a change to contractual terms without authority (for example pay, status, location, or duties), it may amount to a repudiatory breach, opening the door to breach of contract claims and constructive dismissal arguments.

Final written warnings remain the most significant sanction short of dismissal. Used well, they focus attention, set clear consequences, and build an evidential platform if termination later becomes necessary. Used badly—issuing multiple “final” warnings or deploying them for trivial misconduct—they undermine credibility and can make subsequent dismissal look predetermined or disproportionate. HR should be clear on duration and purpose, and be prepared to act on the warning if the issue repeats.

Demotion often appeals as a compromise, particularly where an employee has been promoted beyond capability. But demotion is legally perilous unless expressly permitted by contract or agreed. Without authority, it may be treated as a dismissal and re-engagement, allowing an unfair dismissal claim from the original role, even if the employee continues working in the lower post. Practically, it can also be corrosive to morale and management dynamics unless the employee genuinely accepts the change.

Pay deductions or reductions are similarly constrained. Unless authorised by statute, a contractual clause, or a separate written consent, deductions risk being unlawful and may also undermine trust and confidence—particularly if the amount is punitive.

The consistent themes are straightforward: be proportionate, follow a fair process (investigation, hearing, right of appeal), and document why this sanction – rather than dismissal – was chosen. Action short of dismissal works best when it is not a halfway house, but a structured intervention with clear expectations and review.

The right to be accompanied: when it applies and when it doesn’t

Disciplinary and grievance hearings are high-pressure moments for employees and managers alike. Parliament has recognised this by creating a statutory right to be accompanied – but that right is specific, limited, and often misunderstood by employers.

Under section 10 of the Employment Relations Act 1999, all workers have a standalone right to request a companion at:

Disciplinary hearings (including appeals) that could result in a warning, dismissal or other formal sanction
Grievance meetings concerning a possible breach of a legal or contractual duty

The Acas Code of Practice reflects this right and recommends employers remind employees of it in the meeting invitation. While the statutory obligation only arises when the employee requests accompaniment, failure to follow the Code can increase the risk of unfair dismissal findings and compensation uplifts.

Importantly, the right extends beyond classic misconduct hearings. Capability meetings – including sickness absence reviews and poor performance processes – are covered where the outcome could be a formal sanction.

What it does not cover is just as important. Investigation meetings are excluded, as are meetings where the worst outcome is a genuinely informal warning. Labelling something “informal” is not decisive – if a warning is confirmed in writing and placed on the disciplinary record, it is likely to be formal.

Redundancy consultation meetings are also outside the statutory framework. In Heathmill Multimedia ASP v Jones, the tribunal confirmed redundancy is not a disciplinary process, and the Acas Code expressly excludes redundancy dismissals. However, many employers still sensibly allow companions at final consultation or appeal meetings to enhance fairness.

Flexible working meetings are similarly excluded in law, although Acas guidance encourages accompaniment as good practice.

The key message for HR is that the right to be accompanied is broader than many managers assume – and applies from day one of employment. Getting this wrong can undermine both procedural fairness and the defensibility of any subsequent dismissal.

No harassment where employee could be shown to have participated in ‘banter’

The Oxford Learners Dictionary defines ‘banter’ as ‘friendly remarks and jokes’. On the face of it, you would think that workplaces would welcome ‘banter’ with open arms – it puts people at ease, lightens the mood and helps the working day go that bit quicker.

However, ‘banter’ is not always as ‘friendly’ as it first appears. Unfortunately, harassment and bullying can often be found lurking behind its playful exterior. Both are major workplace issues – not to be taken lightly.

However, a recent employment tribunal case demonstrated that, even where banter strays into unlawful areas, if the employee can be shown to have actively encouraged it, then they will not be able to claim that it was harassment. In Nunn v Crouch Recovery, Ms Nunn worked in a small family run recovery business. She had a personal friendship with the boss. They messaged each other about private topics. Their correspondence included sexual language, including references to her being eye candy and a ‘MILF’. When the working relationship later broke down, Ms Nunn claimed this was sexual harassment. The tribunal, dismissing her claim, accepted that the messages were vulgar and sexual in nature.

However, when placed in the context of the relationship Ms Nunn had with the boss at the time, the tribunal confirmed that the conduct was not ‘unwanted’ (a key component in the offence of harassment). In particular, Ms Nunn didn’t complain about the conduct at the time (only when relations had soured). She had joined in with the banter and laughed at the comments. The tribunal also found that this wasn’t a case where Ms Nunn had ‘joined in’ as a way of protecting herself where the harasser was in a more senior position (which would have meant that the behaviour could still have been found to be harassing). There was evidence of occasions where Ms Nunn had called the business out on conduct and behaviour. She was not, seemingly, afraid of raising issues which bothered her. She had not complained about the texts at the time.

This is not a case which employers will want to have to rely upon. It is not a ringing endorsement for a positive workplace culture where the employer’s line of defence is – that’s just our workplace culture; we all behave badly. However, it is a reminder that tribunals will look closely at the dynamic between the people involved and what actually happened in real time, not just how it feels in hindsight once trust has gone.

Speaking English at work: a reasonable requirement?

Workplaces are multicultural environments. In many workplaces in the UK, workers will have different native languages. Employers have a fine line to tread – if you allow everyone to speak their own languages, then communication may suffer and some workers may feel excluded. By contrast, if you insist that English is spoken at all times and in all circumstances, you may be risking a claim of race discrimination.

Key cases

In the case P F Franco v Fyffes Group Limited, Mr Franco claimed that some of the line supervisors conducted some of their discussions in Polish and this amounted to the application of a provision, criterion or practice (PCP) which put persons who shared the characteristic of not speaking Polish, including him, at a disadvantage.

The claimant, although not English himself, was unhappy that all employees were not required to speak English the whole time. The tribunal considered that Fyffes could objectively justify this PCP. They had reminded staff to be considerate of the needs of others who did not speak their mother tongue. Allowing people who shared a language to communicate in it was likely to lead to clearer communication. The balance would only be tipped when someone who did not speak that language was also party to the conversation.

In the recent case of Kellington-Crawford v Newlands Care Angus, an English-speaking employee was invited to a disciplinary hearing in which her two managers continually talked amongst themselves in Polish. She was left feeling uncomfortable and claimed race discrimination. Her claim succeeded. The key factor was that the employees were speaking their native tongue in her presence to specifically exclude her from the discussion. The tribunal considered that the same finding would not have been made if the discussion had been in the open-plan office.

In Konieczna v Whitelink, the employer was criticised for requiring employees to speak English at all times in the workplace, regardless of their native tongue. The blanket requirement was not justified on the basis of the nature of the business and amounted to race discrimination.

A practical approach

Assess the risk in the workplace of employees not speaking a common language at all times. Consider the different circumstances in which employees interact at work and when those interactions need to be in English. So, for example, it may be entirely reasonable for employees to speak to each other in their native tongue during tea breaks or during social activities. However, when issuing and responding to instructions there is a clearer case for English to be used. Where the line is drawn will depend very much on the nature of the work itself.

Document the business position on language at work and communicate it to all employees – with regular reminders if behaviour begins to slip. Encourage employees to be mindful of their different language skills and encourage clarity in communications. Remind employees that there is an expectation to include non-English speakers in workplace conversations. Equally, if you have a group of non-native English speakers who have a tendency to converse in their own language – remind them that this, in itself, could leave those who do not speak their language feeling uncomfortable (as happened in Kellington-Crawford above).

The Equality Act 2010 Employment Code of Practice contains further practical guidance on this issue (see paragraph 17.44 onwards).

Employment Rights Act 2025: Government keeps broadly to planned rollout

The Government has released a new policy paper confirming that it is largely sticking to the timetable for bringing in the Employment Rights Act 2025. This roadmap was first published last July and, while a few timings have shifted slightly, the overall reform programme remains on track.

Key changes and when they take effect

April 2026

A number of significant reforms will begin, including:

Paternity leave and parental leave becoming day-one rights
Statutory Sick Pay payable from the first day of absence, with the lower earnings limit removed
The maximum protective award in collective redundancy cases doubling from 90 to 180 days
Sexual harassment being added as a qualifying whistleblowing disclosure
Easier trade union recognition due to relaxed thresholds
The formal launch of the Fair Work Agency

August 2026

Wider use of electronic voting for most statutory union ballots (except recognition and derecognition)

October 2026

This is one of the busiest phases of reform and is expected to include:

A requirement to inform workers of their right to join a trade union
Creation of a new Adult Social Care Negotiating Body
A strengthened duty on employers to take “all reasonable steps” to prevent sexual harassment
New employer liability for harassment by third parties
Tribunal time limits extended from three to six months (now stated as “not earlier than” October 2026)
New consultation duties on tipping policies
Expanded access and facilities for trade union officials, including digital access
Protection from detriment for workers taking industrial action – the government has recently launched a consultation on this change which can be accessed here.
Measures aimed at stopping “two-tier” workforces after outsourcing

January 2027

The qualifying period for unfair dismissal reducing to six months
Removal of the cap on compensation for unfair dismissal
New limits on fire and rehire practices (delayed from October 2026)

Later in 2027

Remaining reforms are expected to follow, including:

A new right to unpaid bereavement leave
Restrictions on zero-hours contracts
A requirement that refusals of flexible working requests must be reasonable
Changes to collective redundancy thresholds – the government has recently launched a consultation on this which can be accessed here.
Stronger dismissal protection for pregnant employees and those returning from family leave

What this means for HR

Although a few deadlines have moved, the direction is clear: major workplace reform is coming. Over the next 18 to 24 months, employers will see significant changes across sickness absence, trade union rights, harassment protections, dismissal rules and flexible working. Early planning and policy updates will be essential to stay compliant and manage risk effectively.

When collective agreements become part of an employee’s contract

An employment contract is the foundation of the relationship between an employer and employee. It sets out the main terms that both sides have agreed. However, it is not the only source of obligations.

Some terms are implied, such as the duty of trust and confidence. In certain situations, terms found in other documents can also become part of the contract – even if those documents are not described as contractual. This often happens with workplace policies and, more occasionally, with collective agreements agreed between employers and trade unions.

Normally, collective agreements are not legally binding on individual employees. They are intended to govern the relationship between the employer and the union. However, a recent Court of Appeal decision, in MN v NHS Foundation Trust L, shows that this is not always the case.

The Claimant was a consultant doctor who became subject to a serious disciplinary investigation. The Trust had agreed to follow a collective agreement called Maintaining High Professional Standards in the NHS (MHPS), which sets out how concerns about doctors’ conduct and performance should be handled.

The doctor’s employment contract stated that disciplinary and capability issues would be dealt with using procedures “consistent” with MHPS. An appendix to MHPS said that the Medical Director would act as the case manager in cases involving consultants, although the role could be delegated to a senior manager in other types of case.

Instead of acting as case manager himself, the Medical Director appointed a senior manager to the role. The Trust argued that this part of MHPS was not part of the doctor’s contract. The doctor disagreed and asked the court to require the Medical Director to carry out the role personally.

The Court of Appeal agreed with the doctor. It found that this provision of the collective agreement had been incorporated into the employment contract and was therefore legally binding.

The Court confirmed that terms from collective agreements can become contractual where they are suitable for incorporation. Key factors include:

how important the term is to the working relationship
how clear and precise it is
whether it works in practice
the context in which it applies

In this case, the obligation on the Medical Director was clear, workable and significant -especially given the serious consequences disciplinary investigations can have for a doctor’s career and reputation.

Key takeaway for employers

This case is a reminder that contractual obligations may not sit only in the written employment contract. Employers should also consider collective agreements and related procedures they have committed to follow. In some circumstances, those terms may become legally enforceable – even if they were not intended to be contractual.

Why each allegation should be considered separately in gross misconduct cases

Disciplinary cases rarely involve just one issue. More often, an employee faces several separate allegations at the same time. When this happens, it is vital that employers deal with each allegation individually rather than treating them as one overall problem.

Separating allegations – and reaching a clear conclusion on each – gives employers a much stronger position if a dismissal is later challenged as unfair.

This point was reinforced by the Employment Appeal Tribunal in Tayeh v Barchester Healthcare Limited. The EAT explained that tribunals must look at whether an employer treated multiple charges as:

cumulative (added together to justify dismissal), or
stand-alone (each one capable of justifying dismissal on its own)

If allegations are treated cumulatively and one significant charge is not supported by reasonable evidence, the whole dismissal is likely to be unfair.

However, if each allegation is presented as a separate reason for dismissal – and at least one is properly established – the dismissal can still be fair.

For this reason, disciplinary officers should:

make clear factual findings on each allegation
explain whether each is proven and why
state what level of disciplinary outcome each would justify on its own

This approach effectively gives employers more than one opportunity to show that dismissal was reasonable.

The lesson from Chand v EE

This issue came into sharp focus in Chand v EE. Ms Chand was dismissed for gross misconduct based on four separate incidents, each described by the employer as fraudulent.

The employment tribunal found there was no reasonable basis for concluding that any of the incidents involved fraud. Despite this, it still decided the dismissal was fair because one incident amounted to a serious breach of company policy.

The EAT disagreed and found the dismissal unfair. It explained that:

the reason for dismissal is what the employer actually relied on at the time – not what it could have relied on
here, the employer dismissed for fraud based on all four allegations taken together
once the fraud findings were unsupported, the dismissal could not stand
the tribunal was wrong to reframe the case around breach of policy after the fact

The disciplinary officer had made two key mistakes: combining the allegations into one overall reason for dismissal and focusing on fraud as the basis for the decision. Even though one allegation might have justified dismissal on its own, the way the decision was framed meant it could not be separated and saved.

Key takeaway for HR

Always treat allegations individually. Make clear findings on each and decide what outcome each would justify on its own. Lumping issues together can turn a potentially fair dismissal into an unfair one – even where some misconduct is proven.

Why the Appeal stage really matters: Lessons from Milrine v DHL

When dealing with performance or conduct issues, it can be tempting to see the appeal stage as a final formality – something to complete once the real decision has already been made.

The decision in Milrine v DHL shows why that approach is risky. Even a dismissal that appears fair can be overturned if the appeal is mishandled.

Mr Milrine was a long-serving HGV driver employed by DHL. After more than two years of sickness absence, supported by medical evidence and clear business pressures, he was dismissed on capability grounds. On the face of it, this was a familiar and often defensible situation.

The real problem arose after the dismissal.

Mr Milrine exercised his right of appeal. The first appeal manager declined to hear it. A replacement was appointed but failed to attend the arranged hearing. Although the employer later asked Mr Milrine and his representative to suggest alternative managers and dates, nothing was formally confirmed in writing and, ultimately, no appeal hearing ever took place.

The Employment Appeal Tribunal found the dismissal unfair. Importantly, this was not because the original decision to dismiss was necessarily wrong. It was because the appeal process had been badly handled.

The EAT confirmed several key points:

An appeal is part of the overall dismissal process and must be considered when assessing fairness.
A flawed or missing appeal does not automatically make a dismissal unfair, but it is an important factor.
Poor handling of the appeal alone can be enough to make an otherwise fair dismissal unfair.
Even if the employee would probably have been dismissed anyway, failures at appeal stage can still result in liability, although compensation may be adjusted.

The decision also reflects the standards set out in the Acas Code of Practice. Employers are expected to offer a genuine right of appeal, arrange it without unreasonable delay, ensure it is heard by someone independent where possible, and confirm the outcome in writing. Tribunals take these requirements seriously and may increase compensation by up to 25% if the Code is not followed.

HR takeaway

Fairness is judged across the whole process, not just the initial decision. An appeal is not a rubber stamp. It is a vital safeguard.

If the appeal stage is allowed to drift, fall apart, or become disorganised, it can turn a defensible dismissal into an unfair one – with costly consequences for the employer.

And finally…

A manager at DIY retailer Wickes took a bit of a long shot by taking the business to tribunal for unfair dismissal after she admitted taking cocaine the night before work and refused to take a drug test. In Unsted v Wickes, Ms Unsted was a manager at a Wickes store. After taking cocaine the night before work and drinking a bottle of Malibu, she turned up for work hungover. The business suspected she then took cocaine during her shift after her behaviour changed markedly following a trip to the bathroom. She refused to take a drug test. The employer treated her refusal as if she had returned a positive test result. She was dismissed for gross misconduct. She claimed that Wickes should not have sacked her. Unsurprisingly, the employment tribunal did not agree with her analysis of the situation and found her dismissal to have been fair. They noted that Ms Unsted had admitted taking an illegal drug the night before work and that Wickes’s drug and alcohol policy made it clear that a refusal to test for drugs would be treated in the same way as a positive result.

This case, as well as being an example of an employee being on a ‘hiding to nothing’ in claiming unfair dismissal, is also a reminder to employees that conduct outside of work can, in some circumstances, be relevant to continuing employment. In cases such as this you are not disciplining someone for what they do socially. You are managing the workplace impact and the safety risk. If someone attends work unfit, it is both a conduct issue and a health and safety issue.