We, and the Government, are still hopeful that the Employment Rights Bill will receive Royal Assent by the end of 2025. The ping pong phase continues, with the next sitting on 8 December.

Recent updates and announcements include:

Day one rights

These were a key proponent of the Employment Rights Bill, but last week, the government dropped its proposal to give employees rights to claim unfair dismissal from ‘day one’ of their employment. There will instead be a six month qualifying period, and this will be implemented with new primary legislation (as opposed to an update to the existing act).

On 27 November 2025, the Department of Business and Trade issued a press release, which confirms that day one rights to sick pay and paternity leave are coming in April 2026. 

Compensation cap

This release also confirmed that the qualifying period for unfair dismissal will be reduced from “24 months to 6 months (whilst maintaining existing day one protection against discrimination and automatically unfair grounds for dismissal)” however, it also indicates that the “compensation cap will be lifted”. No other details are given and it is not clear whether this means that all unfair dismissal awards will be unlimited, or whether it only affects one of the current caps. 

Creation of a new Fair Work Agency (FWA)

The Fair Work Agency will bring together the responsibilities of three existing enforcement bodies to create a single agency. The government proposes that this will end “the current fragmented system so that workers and employers know where to turn to for support”. Matthew Taylor, author of The Taylor Review of Modern Working Practices has been announced as the chair of the FWA.

The FWA will be in place from April 2026, with new powers to enforce employer’s failure to pay including statutory holiday and sick pay and national minimum wage by issuing notices of underpayment or non-payment. Payment is required within 28 days, plus a penalty of 200%. There will be a six year underpayment option.

From 2027, it is expected that the FWA will oversee the regulation of umbrella companies. In due course, the FWA will take on enforcement of a wider range of employment rights.  

Government Consultations Launched

Consultations have been launched by the government, who are seeking views on:

• a new duty on employers to inform workers of their right to join a trade union. This consultation is about how it should work in practice. This consultation closes on 18 December 2025.
  • The Department for Business and Trade (DBT) is seeking views on how this new duty can be implemented effectively while minimising the burden on employers. This includes details on:
    • what form the statement should take
    • what content should be included
    • the manner in which the statement must be delivered
    • the frequency with which the statement must be reissued after the beginning of employment
• how the new legal framework for trade unions’ right of access into workplaces should work in practice. Views are sought on the practical and operational details of the framework. This consultation closes on 18 December 2025.
  • The Employment Rights Bill will introduce a new framework for trade unions to access workplaces physically, and to communicate with workers in person or digitally. This includes details on:
    • how unions will request access
    • how employers respond
    • factors the Central Arbitration Committee (CAC) will take into account when determining whether access should be granted and on what terms
    • how the CAC is to come to decisions on the values of fines issued for breaches of access agreements
• enhancing workplace protections against dismissal for pregnant women and new mothers. This consultation closes on 15 January 2026
  • the specific circumstances in which the dismissal of pregnant women and new mothers should still be allowed
  • when the protections should start and end
  • whether other new parents should be covered by the protections
• a new entitlement to bereavement leave, including for pregnancy loss before 24 weeks. This consultation closes on 15 January 2026
  • Views are sought to ensure the new entitlement is shaped with the needs of employees and employers at the forefront, including:
    • eligibility criteria
    • types of pregnancy loss in scope
    • when and how bereavement leave can be taken
    • notice and evidence requirements