Labours flagship Employment Rights Bill (ERB) has finally become law but will it help?

ON 18 December 2025, Labour’s flagship Employment Rights Act officially received Royal Assent, 18 months on from the party's landslide election victory. It represents the most significant overhaul of UK Labour law in decades. This is a very divisive piece of legislation that takes on many issues affecting employment rights within the UK.

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."

While as Acas says:- 'it is presented as a positive step for employees,' some of the changes are considered problematic for businesses, charities, and Councils. Conversely, some trade unions argue the legislation has been watered down during a year of intense parliamentary debate and does not go far enough. The effectiveness of this new flagship legislation will be judged during the passage of its introduction and for years to come.

Some of the changes have already come into effect, such as the measures making it easier to go on strike. By repealing restrictive balloting thresholds and the Strikes (Minimum Service Levels) Act 2023, the Government has fundamentally shifted the landscape of industrial relations. This change is already being felt with the Doctors' strike taking place, as the new legislative framework provides more leeway for organised labour to conduct industrial action without the previous legal hurdles.

Protections coming into force from:- 6 April 2026 include new sick pay and paternity leave rights alongside wider family-friendly reforms. Statutory Sick Pay (SSP) will be overhauled to remove the 3 day waiting period, making it a:- 'day 1' right paid from the 1st day of illness. Additionally, the lower earnings limit will be abolished, extending sick pay to an estimated 1,300,000 lower paid workers. Paternity leave and unpaid parental leave will also become day 1 rights, allowing 32,000 more partners and 1,500,000 more parents each year to access these entitlements immediately upon starting a job, rather than having to wait for 26 weeks or 1 year respectively. The Act also introduces a new day 1 right to bereavement leave, expanding on previous limited provisions for parental bereavement. Furthermore, the legislation strengthens the existing day 1 right to request flexible working. While it remains a:- 'right to request' rather than an absolute:- 'right to have,' managers must now demonstrate that any refusal is not only based on:- 1 of the 8 statutory business grounds but is also:- 'reasonable' in the specific circumstances.

The changes to fire and rehire are among those coming into force in October 2026. This reform will make it automatically unfair to dismiss employees and offer re-engagement on inferior terms, unless a company can prove it is facing extreme financial difficulties that threaten its existence. During this same period, the Government will introduce a strengthened duty for employers to take:- 'all' reasonable steps to prevent sexual harassment, which includes a new liability for harassment committed by 3rd parties like customers or suppliers.

Changes to zero hours contracts and unfair dismissal will come into force in 2027. In a major move to end:- '1 sided flexibility,' employers will be required to offer guaranteed hours to any worker who regularly works a consistent pattern over a 12 week reference period. If a worker on a zero hours contract regularly works more than their minimum hours during this window, the employer is legally required to offer them a guaranteed hours contract that reflects that actual work pattern. This effectively:- 'locks in' high intensity periods. For seasonal and temporary staffing, these rules create a significant administrative burden, as businesses must now track hours meticulously. To manage this, the Act allows employers to use fixed term contracts where there is a:- 'genuine temporary need,' though employers must justify why a permanent guaranteed hours contract is not appropriate.

Administrative complexity is further increased by the new:- 'reasonable notice' requirements for shifts. By 2027, all workers must receive advance notice of their working hours, and any last-minute cancellations or changes will trigger mandatory compensation payments. The legislation also extends these responsibilities to:- 'end hirers' who use agency staff, preventing companies from avoiding these obligations by outsourcing labour needs to recruitment firms.

The final piece of the 2027 rollout involves the reduction of the unfair dismissal qualifying period from:- 2 years to 6 months. While the Government originally promised a:- 'day 1' right, this was diluted to 6 months following pressure in the House of Lords. To balance this, the Act allows for a new statutory probation period during which a:- 'light touch' dismissal process can be utilised for reasons related to conduct or capability. However, as a concession to trade unions, the Government also moved to remove the statutory cap on unfair dismissal compensation. From 1 January 2027, tribunals will be able to award uncapped damages for unfair dismissal. This change aligns these claims with discrimination and whistle blowing cases and significantly increases the financial risk for any organisation terminating staff after their:- 1st 6 months of service.

The Employment Rights Act 2025 represents a significant shift in the balance of power within the UK labour market. By accelerating access to statutory benefits and restricting flexible contracting models, the legislation provides enhance security for the workforce while simultaneously increasing the regulatory and financial responsibilities of employers. As these provisions are phased in over the coming years, both businesses and employees will need to adapt to a more regulated landscape of industrial relations and personnel management.

While the Government presents it as a:- "pro-worker, pro-business" framework, small business advocacy groups like the Federation of Small Businesses (FSB) have labelled it a:- "war on work." What affect this will have on both the job market and the economy is yet to be seen. It will definitely become a major headache for small businesses who are already struggling. Critics argue that this legislation makes hiring young people more:- 'risky.'

These fears are highlighted by how the Government is or isn’t intending to deal with an increasingly volatile job market.

For example, it remains to be seen how the new Youth Guarantee will function following the Royal Assent of the Employment Rights Act.

Small business groups have expressed concern that while the Government is subsidizing these 6 month roles, the Act's removal of the 2 year qualifying period for unfair dismissal means that even a:- "guaranteed" youth placement worker could technically gain the right to sue for unfair dismissal from their 1st day. This creates a perceived legal risk for a business trying to help a long term unemployed young person who may need significant coaching or may not ultimately be a fit for the role. Consequently, businesses may be hesitant to offer the placement opportunities, limiting the opportunities being offered to the young people. This could lead to even worse issues for them entering the job market. On paper the Youth Guarantee, which targets young people aged:- 18 to 21 who have been on Universal Credit for:- 12 to 18 months sounds like a very sensible idea, but if opportunities for them to get jobs that fit their requirements become limited by employers doubts, this will surely only make the long term issues worse. If businesses feel it is too risky to employ these individuals because they cannot easily terminate a contract if a candidate is not suitable , the effectiveness of the Guarantee is called into question.

The core tension within this report lies in the balance between increasing job security for workers and maintaining flexibility, and costs, for employers. By shortening the qualifying period for unfair dismissal, the Government aims to prevent the exploitation of young workers, yet the unintended consequence may be a:- "hiring freeze" for the very demographic the Youth Guarantee intends to support. To resolve this, the Government could consider implementing a specific:- "probationary subsidy" or an enhanced trial period specifically for Youth Guarantee placements. This would allow businesses to offset the perceived risk with more flexible exit clause during the initial 6 months of employment. Furthermore, providing more robust mentorship and pre-employment training could ensure that young people are better prepared for the workplace, thereby reducing the likelihood of a:- "bad fit" and should increasing employer confidence in the scheme. Yet, this should have already been processed and acted on...

The ultimate success of the Youth Guarantee will depend on whether the Government can provide enough reassurance to the private sector to outweigh the perceived regulatory burdens of the new Employment Rights Act. While the legislative changes aim to improve the quality of work, the practical challenge remains ensuring that these protections do not inadvertently create barriers to entry for those at the start of their careers. This should have been foreseen.

In the eyes of many small business's owners, the passing of these legislations yet again shows lack of joined up thinking and comprehension of the current UK job market.

More information about the Employment Rights Act 2025 on:- Gov.UK.

For more information about the Youth Guarantee marks 1 of the most significant steps forward for young people in over a decade, go to:-  YouthEmployment.Org.UK.

What are your thoughts on this situation within the UK's increasingly divisive world of employment?  Email our Newsroom at:- News24@SouthportReporter.Com or send us a message on:- Mastodon, Facebook, or Twitter with your views....

PCC responds to release of Government's Freedom from Violence and Abuse strategy

MERSEYSIDE Police and Crime Commissioner, Emily Spurrell has welcomed the release of the Government's Freedom from Violence and Abuse Strategy, while setting out her ongoing commitment to make Merseyside safer for every woman and girl.

PCC Emily Spurrell in a press statement has said:- "I welcome the launch of the Government's new Violence Against Women and Girls (VAWG) Strategy today, which rightly recognises the scale of the challenge we face and the urgent need to confront the epidemic levels of violence, abuse and harassment women continue to face in their homes, online or in our communities. I support the focus on stronger policing measures, particularly the expansion of specialist rape and sexual offence investigation teams and new approaches to tracking and targeting perpetrators. Tools such as Domestic Abuse Protection Orders, which have already supported 1,000 victims in pilot areas, and the DRIVE project to break cycles of high-risk offending, are encouraging developments. As is the focus on forces using data to track offenders in the same way we do for terrorists and serious organised criminals, ensuring a more consistent, intelligence led approach nationwide. Education and early intervention are critical if we are to make our society safer for women and girls in the future, so the commitments to education and prevention are particularly welcome. The £20m investment to tackle harmful attitudes among young people, alongside curriculum changes and specialist training for teachers and external providers, will help embed healthy relationships and consent into early learning. If we are serious about preventing violence, we must cut off the pathways where boys and men are exposed to misogyny and harmful content. Piloting targeted interventions in Schools where harmful behaviours are emerging; as well as practical training for parents and professionals to spot the early warning signs of misogyny and coercive attitudes; will be key to this, as will be the new measures to make the UK one of the hardest places to access harmful content online. The strategy's whole system approach; spanning local Government, the 3rd sector, housing providers and healthcare; aligns closely with the work we have been focused on delivering through our Region wide VAWG Strategy. Working with nearly 50 partners, we have made significant progress in prevention, safeguarding, training, and specialist support since its launch in 2022. We will use the focus and priorities set out in this strategy to inform our refreshed strategy and build on the foundations from the past 3 years. Tackling VAWG was my motivation for standing to be PCC and since I have taken post it has been my absolute priority. Despite the challenges caused by short term funding cycles, I have worked hard to deliver a model which has strengthened, not fragmented, support: commissioning specialist services, rooted in our communities, to reach those who need them most. I am proud of the progress we have made together. National consistency is important, but it must not come at the expense of local knowledge, local leadership, and local accountability. Local commissioning allows us to respond directly to what victim‑survivors tell us they need; not a 1 size fits all system imposed from the centre. Here in Merseyside, our support services do an incredible job providing specialist support tailored to local need however, they are already under immense pressure, so we will continue to push for increased, ring-fenced funding for their vital services. Additional helplines, GP based routes to support, and £50m for specialist therapeutic care for victims of child abuse will help strengthen the safety net for those who need it most. At the heart of all our work must be victim survivors. Their lived experience is essential in shaping both local and national action and must always be at the forefront of all our minds. We have put their voices centre stage of every phase of our Taking Action campaign challenging harmful attitudes and behaviours. Tackling violence against women and girls is a long-term commitment; 1 that demands relentless focus, determination and collaboration. Above all, it demands that we never lose sight of the women and girls whose lives, safety and futures depend on real change. Their experiences shape our priorities, and their courage drives our work to make our Region safer for every woman and girl."