What to expect in 2026

Following its lengthy parliamentary passage last year, the Employment Rights Act 2025 is now in place! It's now that the fun really begins as consultations are being issued to fill in the detail of various provisions, and the measures contained in the Act begin to come into force.

Here's an overview of what's coming up:

February

Trade union measures – 18 February 2026

Balloting and industrial action changes:

• The 40% support threshold requirement for industrial action ballots in certain important public services will be removed. 
• Information required on industrial action ballot papers will be simplified.
• The mandate period for industrial action following a successful ballot will increase from 6 to 12 months.
• The notice period for industrial action will be reduced from 14 to 10 days.

Trade union administration changes:

• The automatic opt out requirement for contributions to a union's political fund will be repealed (new union members will be automatically opted in unless they expressly opt out).
• Restrictions on check-off in the public sector will end.
• The existing power to require public sector employers to publish information about trade union facility time and the power to place limits on this time will be repealed.  
• Requirements to provide certain information in annual returns to the Certification Officer will be removed.
• The requirement for unions to appoint a picketing supervisor will be removed.

Employee protections:

• Employees will be automatically protected from unfair dismissal for taking part in protected industrial action irrespective of the length of that action.  

April

New minimum wage rates – 1 April 2026

The National Living Wage will increase from £12.21 to £12.71. Meanwhile the rate for those aged 18 to 20 will increase from £10 to £10.85. The rates for under 18s and apprentices will rise from £7.55 to £8.

The Low Pay Commission has recommended that the National Living Wage should extend to 20 year-olds in 2027 and to 18 and 19 year-olds in 2028 or 2029, subject to economic conditions and government policy at the time. This will achieve the government's long-term goal of having a single adult rate for the national minimum wage.

Changes to the redundancy protective award – 6 April 2026

The cap on protective awards in collective redundancy situations will be increased from 90 days to 180 days. 

It's worth being aware that collective consultation will also cover situations where dismissals are carried out before staff are re-engaged on new terms and conditions. Something else to bear in mind here is the Code of Practice on Dismissal and Re-engagement (the Code) which contains the power for employment tribunals to increase or reduce compensation on collective consultation claims by up to 25% where a party fails to follow the Code.

Day one right to paternity leave and unpaid parental leave – 6 April 2026

Paternity leave is currently only available for those employed for 26 weeks or more by the 14th week before the Expected Week of Childbirth. Parental leave is currently only available to employees with one year's continuous employment. As of 6 April, the entitlement to these types of leave will be a day one right.

An individual will also be able to take paternity leave after shared parental leave rather than requiring it to be taken first or lost.

Removal of Lower Earnings Limit and waiting period for Statutory Sick Pay – 6 April 2026

Statutory Sick Pay (SSP) will be made available to all employees from the first day of sickness absence and will be extended to include low earners. Low earners will be entitled to either the flat rate of SSP or 80% of their normal weekly earnings, whichever is lower.

Introduction of new category of protected disclosure relating to sexual harassment – 6 April 2026

An employee reporting sexual harassment will potentially be able to benefit from additional protections, including for detriment and dismissal under amended whistleblowing legislation. In order to bring a successful whistleblowing claim they will still need to comply with the other requirements in the legislation, including meeting the public interest test. As such complaints may already be protected disclosures under existing law, it's likely that this measure is there to raise awareness.

The Fair Work Agency – 7 April 2026

A new body, the Fair Work Agency (FWA), will bring together existing state enforcement functions and will act as a single place where workers and employers can turn for help. This body will help enforce rights such as minimum wage, holiday pay, statutory sick pay and help prevent labour exploitation and modern slavery.

The FWA will be able to enforce failure to comply with the new obligation on employers to keep records demonstrating compliance with holiday entitlement. These are to be kept for 6 years and failure comply will be a criminal offence punishable with fines.  

Please note - although April 2026 is when the FWA is due to be established, the timeframe for it to be fully operational is not yet confirmed.

Various trade union measures – April 2026

The trade union recognition process will be simplified.

Under the current statutory union recognition scheme, unions must show the Central Arbitration Committee (CAC) that at least 10% of the workers in the proposed bargaining unit are union members and that they have evidence that a majority of workers in the unit are in favour of recognition. Under the Act, unions will only need to show that they have 10% membership of the proposed bargaining unit for their application for recognition to be accepted by the CAC. The Secretary of State has the power to vary this 10% to any number between 2% and 10%.

In order for an application for recognition to be successful, the union will have to be supported by both a majority of the workers voting and at least 40% of the workers forming the bargaining unit. The requirement for the support of at least 40% of the workforce in the proposed bargaining unit will change to "a simple majority" of those voting to win.

August

Electronic and workplace balloting will be introduced as a way of increasing participation in statutory trade union ballots.

October

Sexual harassment prevention duty – October 2026

The duty on employers to take reasonable steps to prevent sexual harassment at work will become a duty to take "all" reasonable steps. Regulations will specify the steps that employers should take, such as carrying out risk assessments, although the power to introduce these won't currently be coming into force until sometime in 2027.  

There will also be an obligation on employers to protect their employees from harassment by third parties. This will extend to all types of harassment and not just sexual harassment.

Employment tribunal time limits extended - October 2026

Employment tribunal time limits will extend from three to six months. This will apply to all types of claim, including unfair dismissal and discrimination.

This will be subject to the Acas early conciliation period which, now that it has increased from 6 weeks to 12 weeks, will mean that, some cases, employees will have over nine months before a claim must be submitted.

The reinstatement of the two-tier code for public sector contracts  - October 2026

Protection for those working under outsourced public sector service contracts will be introduced via regulations and a code of practice. This reinstatement of the two-tier code for public sector contracts will ensure that those transferring from the public sector and those employed by the supplier are treated equally.

Further trade union measures – October 2026

Duty to inform workers of the right to join a trade union:

Employers will be under a duty to inform workers of their right to join a trade union. The government issued a consultation on this which closed on 18 December. Once we have the government's response to this we'll have a much clearer idea of how this will work, but it's likely that in relation to new workers this will be delivered directly alongside the statement of employment particulars, whilst for existing workers the government's preference is for the statement to be delivered directly with continuous access (e.g. via a notice board or intranet).  

Access requests:

There will also be a right for a trade union to request access to the workplace to meet, represent, recruit or organise workers and to facilitate collective bargaining, but not to organise industrial action. This will be known as an Access Request. If employers refuse, the union(s) will be able to challenge this at the CAC. The government issued a consultation on this which closed on 18 December.  

Union equality representatives:

The Act will introduce a new statutory role for ‘union equality representatives’ in workplaces that recognise unions. Their duties will be to promote workplace equality and provide advice and support to members on equality matters. They will have a right to paid time off to carry them out.

Additional protections:

All trade union representatives will get improved rights to be provided with reasonable facilities and accommodations. The Act will also extend existing protections against blacklisting.

Measures will protect workers from detriment (of a description to be prescribed in regulations) for taking part in industrial action.

The Adult Social Care Negotiating Body (ASCNB) – October 2026

Regulations to establish the ASCNB are due to come into force in October. The ASCNB will negotiate changes to pay and terms and conditions for care workers and will include both employers and trade unions. The ASCNB will conduct negotiations on the first fair pay agreement in 2027 with enough time to prepare the sector for implementation in 2028.

A detailed consultation, 'Fair pay agreement process in adult social care', aims to gather views from the sector on how to establish the best way to collectively agree a fair pay agreement. This closes on 16 January. There's also an easy read version of the consultation which was issued later than the more detailed one and which closes on 6 March.

Looking ahead to 2027

Changes to unfair dismissal – 1 January 2027

Though not strictly speaking happening in 2026, this is something that employers need to be aware of. On 1 January 2027, the qualifying period for bringing a claim for unfair dismissal will reduce from two years to six months, highlighting the importance of robust recruitment practices and well-managed probationary periods. Employers need to be aware that those who have 6 months qualifying service on 1 January 2027 will be eligible to bring a claim.

The compensatory award for an unfair dismissal claim is based on a statutory cap (currently £188,233) or 52 weeks' salary, whichever is the lower amount. This cap will be removed on 1 January 2027.

Fire and rehire – January 2027

A dismissal will be automatically unfair if the reason is that the employee does not agree to vary terms on pay, working hours, pension, shift time and length, and time off, along with other terms to be defined in regulations.

A dismissal will also be automatically unfair if the employer:

• wants to impose a flexibility clause covering those changes;
• intends to employ another person on varied terms to do the same role; or
• intends to replace the employee with agency or other non-employed workers.

There is a very narrow exception where the employer needs to eliminate or significantly reduce financial difficulties affecting their ability to carry on business as a going concern, and cannot reasonably avoid needing to make the variation.

If the exception applies, the dismissal will not be automatically unfair but the employment tribunal will consider if the dismissal was fair in all the circumstances, so an employer will need to show that they have a good and sound business case for the proposed changes and have followed a fair procedure including consultation.  

More generally…

The publication of the Equality (Race and Disability) Bill

The government has committed to publishing this Bill in draft form for pre-legislative scrutiny sometime during this Parliamentary session, so it's likely we'll see this in 2026. The Bill is expected to include several measures aimed at tackling pay gaps and discrimination, such as:

• Extending equal pay gap reporting to cover ethnicity and disability for employers with more than 250 staff.
• Extending equal pay rights to protect workers suffering discrimination based on race or disability.
• Ensuring that outsourcing of services can no longer be used by employers to avoid paying equal pay.
• Implementing a regulatory and enforcement unit for equal pay with involvement from trade unions.

The government published a call for evidence on equality law on 7 April 2025 which closed on 30 June 2025. This sought views and evidence on plans to extend the equal pay provisions in the Equality Act 2010 to race and disability and bring combined discrimination into force. It also asked about the reasonable steps employers should take to prevent sexual harassment, extending the public sector equality duty to all parties exercising public functions and commencing the socio-economic duty in England.

Consultation on employment status

This has been promised in 2026. The government has committed to introducing a single status of worker and wants to transition towards a simpler two-part framework for employment status (moving away from the existing three-part framework of employee, worker and self-employed individual).

Reform of employment post-termination and non-compete provisions

The government published a working paper in November on options for the reform of non-compete clauses in employment contracts, with responses to be submitted by 18 February 2026.

Employment rights for unpaid carers

The government set up an internal government review to look into employment rights for unpaid carers in November. It expects the review to conclude in 2026.

Lots more consultations on the Act!

According to Peter Kyle, Secretary of State for Business and Trade, there are due to be 26 separate consultations on the Act. Some of these will be in relation to reforms that will happen in 2027, namely new provisions in relation to zero hours workers, the detail of the new day one right to flexible working, and the consultation on the new collective consultation threshold which will impact on employers making redundancies across multiple sites.

In conclusion

2026 is setting itself up to be a busy year for employment. Keeping up with developments will be essential so that employers can keep on top of changes, avoid any pitfalls and stay compliant.

We have written in more detail about many of the areas mentioned in this bulletin, so please do have a look on our HR Hub for more information.