After months of debate, the Employment Rights Bill has received Royal Assent and is now law.
The Act, which applies to England, Wales and Scotland, gives workers a wide range of expanded and new employment rights.
It has proved controversial with business groups, particularly around Labour’s pledge to give employees the right to claim unfair dismissal from day one in a job. That was changed to six months after negotiations.
Other changes include day one access to statutory sick pay and paternity leave, a ban on “exploitative” zero-hours contracts, increased parental and bereavement leave, tougher duties on employers to prevent sexual harassment, and stronger protections for whistleblowers.
The government says over 15 million workers will ”benefit from a modern framework for workers’ rights that helps more people stay in work, supports productivity, and boosts living standards”.
It says new day one rights allow 32,000 more dads and partners each year to take paternity leave and 1.5 million more parents to take unpaid parental leave.
Ministers say the statutory sick pay reforms will apply to 1.3 million more workers, and up to 2.7 million employees a year will gain the right to the new bereavement leave entitlement.
Many of the changes now depend on extra regulations and government guidance. More consultations with business groups, trade unions and others will take place on the exact detail on how the new system will work.
Prime minister Keir Starmer said:
“Today we have proved what a pro-business, pro-worker government can achieve – a modern framework for worker’s rights.”
“This Act sets in motion an increase in living standards, supporting productivity and importantly, more security and dignity for people in work.”
“When we said we’d bring work into the 21st century, we meant it – and today we’ve delivered it.”
Business secretary Peter Kyle said:
“The landmark Employment Rights Act will transform workplace law for the 21st century - bringing stronger protections and the fairness every worker deserves.
“We believe this change is a vital part of creating and maintaining good jobs and fair pay. This government is championing responsible businesses, driving fair competition, and creating a future where hardworking people enjoy real security and opportunity.
“We will deliver this change in partnership with businesses, trade unions and civil society.”
Reaction from experts to Employment Rights Bill receiving Royal Assent
Kate Shoesmith, director of policy at the British Chambers of Commerce:
“It has already been a long journey for the Employment Rights Bill to become law, but we still have a considerable distance to go on this odyssey.
“Royal Assent is a key milestone as it allows businesses, the unions and government to now focus on getting the detail right, to ensure everyone is ready for the coming changes.
“The consultation on the secondary legislation, which will govern much of the day-to-day practicalities of employment rights, is now going to be vital.
“Businesses are clear they still have major concerns about the workability and costs of several other powers in the Bill.
“These include issues relating to guaranteed-hours contracts, seasonal and temporary workers, thresholds for industrial action, and the practical application of union rules.
“It is hugely important that workable agreements are found through further discussions, using the tripartite model that led to the compromise on unfair dismissal.
“Businesses, especially smaller ones, will need a lot of support and guidance from government to make sure they get this right and have the correct policies and processes in place.
“They will want to do the right thing, but the sheer scale of these changes means the challenges this presents cannot be underestimated.
“In terms of immediate impact, nothing is changing, but businesses will need to look ahead.
“Due to the delays in agreeing the final shape of the Bill, there will be a wave of fresh consultations beginning in January.
“The BCC will be putting together a programme of support for Chambers and firms to help them prepare for, and then implement, changes as they are introduced.
“Businesses shouldn’t panic and we would advise them to be careful about offers of external help, from organisations that are unknown to them. There is a long way to go on this legislation, and the best advice will come from those most involved in it.”
Phil Coxon, managing Director at Breathe HR:
“The Employment Rights Bill reaching Royal Assent is a win for workers and businesses alike. It will enhance workers’ rights and wellbeing, and the majority of SME HR leaders believe it will boost productivity and retention. However, we cannot underestimate the financial, administrative and legal challenges it will bring.
“Many SMEs lack dedicated HR functions and the deep resources of larger companies. As a result, almost two-thirds of SME leaders say the new changes will disproportionately affect smaller businesses. With rising operational costs and the challenging economic climate already pushing many small businesses to the brink, the government must provide robust support, resources and guidance to ensure SMEs can survive and see these changes through successfully.
“In the meantime, employers should take a proactive approach by strengthening their core HR processes, reviewing policies and employment contracts, and using technology to streamline essential HR administrative tasks. This will free up capacity, enabling leaders to focus on strategy, compliance, and ensuring the changes benefit everyone.”
Niall Mackenzie, Acas chief executive, said:
“This is a once-in-a-generation change to employment law in Britain and an opportunity for employers and workers to work together to bring all workplace relations up to the standard of current best practice, and help businesses thrive and improve working lives.
“Acas will be updating its training and advice as the new laws are implemented. We stand ready to help employers, workers and their trade unions work together to make the most of the opportunity presented by these reforms to build better, healthier and more productive workplaces.”
Craig Beaumont, executive director at the Federation of Small Businesses:
“We worked hard in the negotiations with unions and DBT ministers to secure the six month qualifying period, and small businesses will be pleased to see that now confirmed in legislation. The fear of being sued from day one was the greatest concern about the legislation.
“We will continue to work with the team in good faith on secondary legislation to address the remaining issues, in line with the secretary of state’s pledge to us for implementation to be harmonious, sensible and sensitive to our needs.”
Peter Cheese, chief executive of the CIPD:
“The passing of this bill, after a difficult passage through parliament, marks a significant shift in employment rights and the rights of trade unions and it has been a key pillar of the government’s agenda. It was finally achieved through the process of consultation and pragmatic compromise on key issues around the early stages of employment. This approach will continue to be needed on the many details still to be worked through that will now be part of secondary legislation.
“It now provides clarity for employers and sets a timeline for businesses to prepare for the many changes, and in reviewing key people management practices and policies, some of which must start now. The backdating of the now agreed six-month qualification period for unfair dismissal, which comes in to effect from January 2027, means it applies to anyone who has by then completed at least six months in employment, emphasising the importance of clear accountabilities, performance management and feedback practices, and policies.
“There remain many concerns on key provisions within the bill, including compensation caps for unfair dismissal, the need for the wider review of the tribunal system and enforcement practices, along with reference periods for zero contracts, changes to trade union recognition, and proposed reforms to collective consultation rules. These should all be part of proper consultation and we welcome the government’s statements in this regard.
“With so much change, it will be crucial for the government to provide clear advance communication, alongside practical guidance and support for employers. And to provide this in good time, particularly for smaller organisations that don’t have in-house HR support.
“As the professional body for HR and people development we will play our part not only in the further consultations to come, but also in developing guidance and training. For example, on working together with unions, and supporting our members and the wider profession to understand and manage the changes effectively. We all need to work together to ensure that the bill works in a positive way to help those in more insecure work or working environments, but that it does not become a brake on recruitment and growth.”
Roy Magara, employment solicitor at Magara Law:
“Many organisations are still operating with outdated assumptions about flexibility and probation.
“The two-year safety net for unfair dismissal will be replaced, and employers will need to justify their actions from day one.
“If it came into force today, around three-quarters of employers simply wouldn’t be ready. It represents a fundamental shift in employment risk.
“Too many employers don’t have the systems or documentation in place to manage these changes. In flexible-work sectors, the failure to track hours or formalise regular shift patterns could lead to costly claims.
“Meanwhile, poorly drafted contracts or probation clauses could fall short of new legal standards, which need to stand up to legal scrutiny from day one.”
TUC general secretary Paul Nowak said:
“This is a landmark day for millions of workers. The Employment Rights Act represents the biggest upgrade in workers’ rights in a generation.
“It will deliver common sense changes like banning exploitative zero hours contracts, protecting workers from harassment and sick pay for all – and so much more. These are hard-won rights that the union movement and workers have long campaigned for.
“For too long, we have lagged behind our European counterparts on workers’ rights. This legislation takes us closer to the mainstream.
“We are finally closing the door on the broken status quo defined by insecurity, poor pay and weak rights.
“It’s now vital the government finishes the job – ensuring workers feel the benefits of all these new protections as soon as possible. That means watertight secondary legislation, which delivers new rights fully and quickly.”
Katherine Chapman, executive director of the Living Wage Foundation:
“The Employment Rights Act is a welcome step forward in improving protections for people in insecure work. Too many people face unpredictable hours and shifts which make it impossible to plan their lives and make ends meet.
“Many employers are already going further than the new baselines, including over 270 Living Hours Employers who are committed to giving contracts that reflect hours worked, giving reasonable notice of shifts, and guarantee minimum hours. It’s good for their employees and good for their business.
“We look forward to working with employers as this new legislation is implemented, to help deliver greater security and stability for workers.”
Ben Harrison, director of the Work Foundation at Lancaster University:
“Passing the new Employment Rights Act into law is a critical milestone for employment reform in the UK and will better align our key employment laws with international standards.
“Reducing unfair dismissal to six months has the potential to take over a million people out of severe insecurity at work, and improve job security for millions more. Taken together with changes to key measure such as zero-hour contracts and day one rights, Work Foundation analysis shows that women, disabled people, ethnic minorities and young people all stand to gain most from the new Act.
“Now the focus must be on ensuring new codes of practice and secondary legislation underpinning the reforms deliver on the spirit of the Act as intended, so that as many workers as possible benefit from two-sided flexibility, extra protections and security at work in the coming years.”
Rachel Grocott, Pregnant Then Screwed:
“This Act is a huge milestone for mothers, parents and families who have been fighting for fairness for far too long. Day‑one rights to sick pay, paternity leave and parental leave will transform the lives of new parents who’ve been forced to choose between their income and their child. Stronger protections during pregnancy and after maternity leave will give women far greater security at work. And ending exploitative zero‑hours practices will give families the stability they need to plan their lives with confidence.
“But let’s be clear: this is not job done. Workplace discrimination is still pushing thousands of mothers out of the labour market every single day, and our parental leave system remains hugely outdated and unequal. We will keep working with the government to deliver the bold, systemic reforms families need. These changes didn’t happen by accident, they happened because parents spoke out, shared their stories and demanded better. Today, the government has listened, and families across the UK will feel the impact of that courage. This Act is a huge step forward, now we must keep going until every parent is treated with dignity, respect and fairness.”
Jenny Herrera, CEO of the Good Business Charter:
“The Employment Rights Act helps shift focus back onto protecting low paid workers on which our society depends and we are broadly supportive of anything that improves the working conditions for workers within the bounds of financial reality. We particularly applaud the banning of evil zero-hours contracts when imposed on workers against their will. Good Business Charter accredited organisations already take a stand for their workforce, making five clear commitments to their colleagues. They know that the benefits of treating people well are enormous.”