Employment Rights Act 2025: what HR leaders need to prioritise now 

The Employment Rights Act 2025 and wider employment law reforms are set to bring some of the most significant changes to UK employment law in a generation. From unfair dismissal reform and statutory sick pay to workplace harassment, family leave rights and collective consultation requirements, employers face an increasingly complex compliance landscape. 

To help organisations understand what lies ahead, Frazer Jones recently hosted a series of webinars featuring employment law experts Claire Elston and Emma O’Connor, alongside Frazer Jones Directors Siobhan Waterfield and Aseel Ibrahim. Across both sessions, the speakers explored how the proposed reforms could affect employers and, more importantly, what HR leaders should be doing now to prepare. 

While the legislation continues to change, one message emerged consistently throughout both discussions: organisations that strengthen their recruitment, probation management, performance management, compliance and employee relations processes today will be best placed to adapt tomorrow. 

Unfair dismissal reform is the biggest change employers face 

One of the most significant reforms under the Employment Rights Act 2025 is the proposed reduction in the qualifying period for ordinary unfair dismissal claims from two years‘ continuous service to six months. 

While the reforms stop short of introducing full day-one rights for unfair dismissal claims, the expansion of unfair dismissal protection represents one of the biggest shifts in employment rights for many years. Employees will gain access to legal protection much earlier in their employment, reducing the time employers have to assess suitability and address concerns. 

Alongside this, proposals to remove the existing compensation cap could increase employer exposure to larger compensatory awards in an employment tribunal. Although awards will continue to reflect actual losses, the removal of the compensation cap may create greater financial uncertainty when disputes arise. 

For employers, this means dismissal decisions that may once have been viewed as relatively low risk could attract much greater scrutiny. As a result, organisations should review how they approach recruitment, probationary periods, performance management and dismissal procedures.

Recruitment and probation management need a rethink 

Both Claire Elston and Emma O’Connor highlighted the growing importance of making the right hiring decisions from the outset. 

As unfair dismissal protection becomes available sooner, employers will have less room for error when bringing new people into the business. Greater emphasis will need to be placed on workforce planning, role design, candidate assessment, onboarding and effective probation management. 

A key theme throughout the discussions was that probation periods and legal employment rights are not the same thing. Many organisations assume that because someone remains within a probation period, dismissal can be managed more informally. However, employment rights are determined by length of service, not by whether an individual remains within a probationary period. 

Employers should therefore review: 

• The length and structure of probation periods 

• Existing probationary periods and extension processes 

• Probation processes and review schedules 

• Record-keeping requirements 

• Documentation standards 

• Support and intervention procedures for new hires 

• Manager capability when addressing performance concerns 

Clear expectations, measurable objectives and regular review conversations will become increasingly important as the qualifying period shortens. 

Performance management is becoming a business-critical capability 

Throughout both webinars, performance management emerged as one of the most important areas for employers to strengthen. 

Effective performance management is no longer simply an HR responsibility. Managers will increasingly need the confidence and capability to identify concerns early, provide constructive feedback and follow a fair process when issues arise. 

Emma O’Connor noted that many employment disputes stem from poor communication rather than deliberate misconduct. Employees who understand expectations and receive consistent feedback are less likely to challenge employment decisions and more likely to engage positively with improvement plans. 

Where performance concerns cannot be resolved, employers should ensure they can demonstrate both a fair reason and a fair process. Decision-making should align with the ACAS Code of Practice and be supported by appropriate documentation, evidence and, where necessary, written reasons for dismissal. 

Strong performance management also delivers benefits beyond legal compliance. It supports employee development, improves engagement and provides greater transparency throughout the employee lifecycle. 

Compliance and record-keeping are moving up the agenda

The introduction of the Fair Work Agency was highlighted as another significant development that employers should monitor closely. 

The agency will have responsibility for enforcing various employment rights, including holiday pay, national minimum wage compliance, statutory sick pay and certain worker protections. It will also have powers to investigate employers, review records and require businesses to rectify underpayments where issues are identified. 

Claire Elston emphasised that strong record-keeping practices will become increasingly important as regulatory scrutiny increases. 

Employers should review how they manage and store information relating to: 

• Statutory sick pay 

• Holiday entitlement 

• Worker classification 

• Agency worker arrangements 

• Payroll records 

• Employment contracts 

• Performance management processes 

• Dismissal procedures 

Good documentation has long been considered best practice. Under the new framework, it may become one of the most important safeguards available to employers facing an employment tribunal claim. 

Harassment, discrimination and whistleblowing remain key risk areas

Recent reforms relating to sexual harassment obligations featured prominently throughout both webinars. 

Employers already have responsibilities to prevent workplace harassment, but forthcoming reforms are expected to place greater emphasis on proactive prevention measures and employer accountability. 

Particular attention is being paid to third-party harassment, where employees may experience inappropriate behaviour from customers, clients, suppliers or contractors. Employers will increasingly need to demonstrate that appropriate safeguards, reporting processes and training programmes are in place. 

The speakers also discussed enhanced protections for employees who raise concerns regarding sexual harassment through whistleblowing channels. Managers should be equipped to identify potential whistleblowing matters and understand how to handle them appropriately. 

Alongside harassment risks, employers should continue assessing their exposure to discrimination claims. Unlike ordinary unfair dismissal claims, discrimination and whistleblowing claims do not require a minimum period of service, making them an ongoing consideration regardless of the changes to the qualifying period. 

Family leave rights and worker protections continue to expand

The Employment Rights Act 2025 also introduces a number of reforms designed to strengthen employee protections beyond dismissal-related matters. 

Most notably, paternity leave and unpaid parental leave have become day-one rights for eligible employees, removing previous qualifying service requirements. 

Organisations should also continue monitoring developments relating to shared parental leave, bereavement leave and wider family-friendly policies. While these changes aim to improve support for employees, they will require employers to review policies, update documentation and ensure managers understand their responsibilities. 

Workers engaged on zero-hours contracts also remain a key focus of reform. Current proposals include requirements to offer guaranteed hours arrangements, provide reasonable notice of shifts and compensate workers when shifts are cancelled at short notice. 

These measures are intended to reduce one-sided flexibility and are expected to have a significant impact on sectors such as hospitality, retail and logistics. 

Fire and rehire, redundancy and contractual change are under greater scrutiny

The webinars also explored reforms affecting fire and rehire practices, employment contracts and collective consultation obligations. 

Under the proposed changes, employers will face greater restrictions when attempting to change contractual terms through dismissal and re-engagement. This reinforces the importance of meaningful consultation and employee engagement when implementing workplace changes. 

The discussion also highlighted the management of fixed-term contracts. As Emma O’Connor explained, the end of a fixed-term contract still constitutes a dismissal in legal terms. Employers therefore need to ensure they can demonstrate a fair reason and that appropriate dismissal procedures have been followed. 

Organisations should also review existing employment contracts and ensure contractual arrangements remain aligned with evolving legislation. 

When considering restructuring activity, employers should carefully review their redundancy processes. Proposed changes could increase financial exposure where collective consultation obligations are not met, while extended tribunal time limits may place additional demands on record retention and evidence gathering. 

Many disputes may continue through early conciliation before reaching a full employment tribunal hearing, making accurate documentation and communication increasingly valuable. Employers that fail to follow fair redundancy processes could also face increased pressure to negotiate settlement agreements. 

Five priorities for HR leaders

While implementation timelines continue to develop, employers do not need to wait before taking action. 

The experts identified five practical priorities for HR leaders: 

1. Strengthen recruitment and workforce planning processes. 

2. Review probation periods, onboarding frameworks and probation processes. 

3. Invest in manager training, employment law awareness and employee relations capability. 

4. Audit policies, employment contracts, fixed-term arrangements and compliance procedures. 

Assess organisational risk across unfair dismissal, redundancy, discrimination, sexual harassment and whistleblowing claims. 

Looking ahead

Taken individually, each reform presents its own challenges. Collectively, however, they signal a broader shift towards stronger employee protections, increased employer accountability and greater scrutiny of workplace practices. 

As Claire Elston and Emma O’Connor highlighted throughout the Frazer Jones webinar series, organisations that focus on preparation rather than reaction will be best placed to navigate these changes successfully. By strengthening recruitment, probation management, performance management, documentation and employee relations practices now, employers can reduce risk, minimise exposure to employment tribunal claims and create more resilient workplaces for the future. 

How Frazer Jones can help

As employment law continues to evolve, organisations need HR professionals who can balance compliance requirements with commercial priorities. Frazer Jones specialises in connecting businesses with HR talent capable of navigating legislative change, strengthening people processes and supporting organisational growth. Whether you’re reviewing your HR structure, preparing for upcoming reforms or looking to future-proof your people strategy, our specialist consultants can help you find the expertise you need.