Employment Rights Bill: Key Updates SMEs Need to Know (2024–2027)

The UK Government has now entered the consultation phase for the Employment Rights Bill announced in 2024.

The Bill is split into four timelines: April 2026, October 2026, 2027 and some areas with no confirmed implementation date.

For SMEs in West Sussex, this update is designed to help you quickly understand what’s being proposed, when it may take effect, and how it could impact your HR processes over the coming months and years.

We’ve summarised the Employment Rights Bill below so you can clearly see what the changes may mean for your business.

What the Employment Rights Bill Means for SMEs

While the Bill is still at the consultation stage, the proposals, if implemented, could affect everyday HR processes like sickness absence, parental leave, redundancy procedures, union recognition, and harassment prevention.

For smaller businesses, this means reviewing policies earlier than anticipated and ensuring your HR documentation, processes, and line manager training are ready for potential “day one” employee rights.

If you need help reviewing your policies, we can support you through our
HR Manager Service or proactive HR Helpline.

HR Smart’s View

There is still no need to panic.

The Bill is now in a consultation period between the UK Government, trade unions and businesses.

The proposals are not coming into law just yet — in fact, they are unlikely to come into force until 2026 at the earliest.

A full legislative process is being followed, and the Bill may be strengthened, weakened, amended or even dismissed. HR Smart will keep you updated with any legislative changes so that you do not miss anything.

Employment Rights Bill – April 2026

Trade Unions Processes

• Simplifies the union recognition process.
• Introduces electronic balloting to make mobilisation easier.

Sick Pay

• SSP becomes a day one right.
• Removal of the three-day waiting period.
• LEL requirement removed, replaced with: lower of weekly SSP flat rate or 80% of normal weekly earnings.

Collective Consultation During Redundancy

• Protective Award may extend from 90 days to 180 days if rules are breached.

Paternity Leave

• Becomes a day one right (no 26-week service requirement).

Unpaid Parental Leave

• Becomes a day one right (no one-year service requirement).

Whistleblowing

• Sexual harassment disclosures included as protected qualifying disclosures.

Establishment of Fair Work Agency

• Single point of access for workers seeking advice or dispute resolution.

Gender Pay Gap and Menopause Action Plans

• Voluntary action plans for organisations with 250+ workers.

Employment Rights Bill – October 2026

New Trade Union Operational Changes

• Strengthens union access and representative protections.
• Protects employees from detriment during/after industrial action.

Fire and Re-Hire Changes

• Limits when employers can fire and re-hire on new terms.
• Only permitted where survival of the company is at risk.

Tribunal Application Period

• Extends the deadline from three to six months for submitting a claim.

Employer’s Duty to Prevent Sexual Harassment

• Duty increases from taking “reasonable steps” to “all reasonable steps”.

Protection From Third-Party Harassment

• Employers must prevent harassment from clients, contractors, suppliers, etc.

Employment Rights Bill – During 2027

Trade Unions

• Restriction on “blacklisting” individuals involved in union activity.

Collective Consultation During Redundancy

• Threshold changes from 20+ employees per location to 20+ employees across the company.

Sexual Harassment

• New oversight body to assess whether employers took “all reasonable steps”.

Unfair Dismissal Rights

• Service requirement reduced from two years to an initial period (6–9 months).

Zero Hours and Agency Workers Contracts

• Right to request guaranteed hours after 12 weeks.
• Right to reasonable notice of shift changes and compensatory payments.

Gender Pay Gap and Menopause Reporting

• Mandatory for organisations with 250+ employees.

Protection For Pregnant Workers

• Unlawful to dismiss a woman during maternity leave or for six months after returning (with limited exceptions).

Bereavement Leave

• One week of unpaid leave as a day one right.
• Applies to the loss of a close relative, and extends to baby loss up to 24 weeks pre-birth.

Equality Race & Disability Bill

Equal Pay Rights

• New rights for Asian, minority ethnic and disabled workers to make equal pay claims.
• Enforcement unit to be established with trade unions.
• Outsourcing to avoid equal pay obligations outlawed.

Ethnicity and Disability Pay Gap Reporting

• Compulsory for employers with 250+ employees.

Existing Powers & Non-Legislative Routes

Paid Carers Leave

• Review of the Carers Act 2023 and potential introduction of paid carers leave.

Summary

Not all proposed changes will affect every business. Many only adjust existing legislation and may still change after consultation.

However, we recommend that all businesses, especially SMEs across West Sussex, review their recruitment, documentation and employee management processes, particularly around day-one rights and SSP arrangements. These areas are likely to have the biggest impact going forward.

If you have any questions about how these proposals could affect your organisation, you can contact Jon at jon@hrsmartuk.com or call 01903 754107.

Contact Us

If your business is based in West Sussex, HR Smart can help you prepare for upcoming changes and stay compliant with employment law developments.

For friendly, practical advice, get in touch via our HR Manager Service or HR Helpline — no obligation, just straightforward support for SMEs.