19.03.2025

On 4 March 2025, the Government published its responses to the various public consultations it undertook towards the end of last year – see the outcomes here and our earlier e-alert here. (These publications followed a report published by the Business and Trade Committee the day before which said that some of Labour’s planned reforms did not go far enough, see here.) In the light of these consultations, the Government tabled numerous amendments to the Employment Rights Bill (the ‘Bill’). Currently the amended Bill runs to over 300 pages. 

A second reading of the Bill is scheduled to take place in the House of Lords on 27 March 2025, and we expect its contents to continue evolving over the months ahead. At this stage, headline changes to note include the following:  

  • The maximum amount of the protective award for failure to collectively consult has been doubled (from 90 days' pay to 180 days' pay), which will materially increase the risks of an employer failing to handle collective redundancy processes properly. In addition, under the amended Bill, collective consultation will be required if there are 20 or more redundancies at one establishment OR a different threshold is met. We expect further details of the alternative threshold to be set out in regulations. Plans to introduce new rights to interim relief in collective redundancy or fire and rehire situations have been dropped, but the Government has stated that guidance will be published for employers on consultation processes for collective redundancies in due course.
  • The Bill will introduce a new rate of statutory sick pay (‘SSP’) under which workers will either receive 80% of their weekly earnings or the existing flat rate of SSP (whichever is the lower), from the first day of sickness.
  • Agency workers will be granted the right to be offered guaranteed hours, as well as reasonable notice of shifts and compensation when shifts are cancelled, curtailed or moved at short notice; although the Government recognises that there will need to be a framework for the application of these new zero hours contracts measures to agency workers with the responsibilities falling to both the employment agency and the end hirer.
  • Trade unions will have a new right to access the workplace - including virtually - to meet workers and facilitate collective bargaining (with a framework for fines to be issued in the event of employer breach). Various changes will be made in relation to industrial action (for example, the 50% industrial action ballot turnout threshold will be repealed, trade unions will have to give 10 days’ notice of industrial action, and mandates for industrial action will expire after 12 months (rather than 6)). Changes will also be made in relation to recognition and notice requirements (including the introduction of e-balloting and it will become easier for unions to complain about unfair practices during recognition applications).

Realistically, it seems unlikely that the Employment Rights Bill will receive Royal Assent before Autumn 2025, and even once the Bill becomes an Act, most of the reforms will take effect from 2026. Secondary legislation will be needed in order to implement many of the planned changes and we expect further public consultations in due course. 

Make UK members can be assured that we will continue our in depth and constructive dialogue with Government on the measures in the Bill, as well as on the other proposed changes to employment law, ensuring that their views continue to be heard.

We will be exploring forthcoming legislative developments in our Spring Employment Law Updates. Click here to book your place. 

If you are a Make UK subscriber, you can speak with your regular adviser and/or access further information in our HRL Resources. Please note that you may need to reset your password to access our HRL Resources following our recent IT platform upgrade – please contact us if you require support.

If you are not a Make UK subscriber, you can contact us for further support on this topic or to access our resources. Please click here for information on how we can help your business.

As has been widely publicised since the Autumn Budget, from 6 April 2025 the rate of Secondary Class 1 national insurance contributions (employer NICs) will go up from 13.8% to 15%, and the salary threshold at which businesses become liable to pay employer NICs will be lowered from £9,100 to £5,000 a year. National Minimum Wage and National Living Wage rates will also go up from 1 April 2025 (see question 3 of our December FAQs here). 

In addition, we now know that from 6 April 2025 the following changes will take effect (see legislation laid before Parliament on 14 March 2025 here):

  • The maximum compensatory award an employee can claim for unfair dismissal will increase from £115,115 to £118,223 (or 52 weeks’ gross pay if that is lower than £118,223).
  • The minimum basic award where a dismissal is unfair due to health and safety, employee representative, trade union, or occupational pension trustee reasons will increase from £8,533 to £8,763.
  • The maximum amount of a ‘week’s pay’ – which is used for the purposes of calculating the basic award for unfair dismissal and statutory redundancy pay – will increase from £700 to £719.
  • Statutory guarantee payments will increase from £38 to £39 per day.

If you are a Make UK subscriber, you can speak to your regular adviser for further guidance and/or access information in the HR & Legal Resources section of our website.

If you are not a Make UK subscriber, you can contact us for further support on this topic or to access our resources. Please click here for information on how we can help your business.

New rights to statutory neonatal care leave and pay will come into effect on 6 April 2025 – see here for further details.

Under the new rules, eligible parents may take one week’s neonatal care leave (NCL) for each full week that their child has received neonatal care. The entitlement is for up to 12 weeks of NCL (and, if eligible, pay – see below) on top of any other leave the employee may be entitled to, including maternity and paternity leave.

Where an employee has twins (or another multiple birth), the maximum total amount of NCL an employee can claim remains 12 weeks, regardless of how many children are receiving neonatal care. NCL cannot be claimed per child in respect of babies receiving care at the same time. For example, if twins receive neonatal care for a period of four weeks, the employee would only be entitled to four weeks NCL.

A template policy and webpage are available to Make UK subscribers in our HR & Legal Resources.  We will also explore these new rights and other forthcoming legislative developments in our Spring Employment Law Updates. Click here to book your place.

If you are a Make UK subscriber, you can speak with your regular adviser and/or access further information in our HRL Resources. If you are not a Make UK subscriber, you can contact us for further support on this topic or to access our resources. Please click here for information on how we can help your business.

Discrimination by perception claims arise under section 13 of the Equality Act 2010, where one person is treated less favourably because another person (the discriminator) perceives the individual to have a particular protected characteristic. This would be the case, for example, if an employer rejected a job application from a white woman whom they wrongly thought was black, because the applicant has an African-sounding name (paragraph 3.21, Equality and Human Rights Commission (EHRC) Employment Code).  The employer’s perception in this example that the job applicant was from a particular ethnic group, and the less favourable treatment of that applicant as a result, would amount to direct discrimination by perception.  

Similarly, age discrimination by perception would arise where an employer treated an employee less favourably because they perceived that the employee was of a certain age. This could arise, for example, if an employer chose not to promote someone because they thought the employee was "too young" to hold a senior role even though, in reality, the employee was older than other workers in similar posts.

If you are a Make UK subscriber, you can speak to your regular adviser for further guidance and/or access information about discrimination, harassment and bullying, including template policies and drafting guidance, in the HR & Legal Resources section of our website. 

If you are not a Make UK subscriber, you can contact us for further support on this topic or to access our resources. Please click here for information on how we can help your business.

Yes, the Government indicated in ‘Next Steps to Make Work Pay’ that it plans to make various changes in relation to employment status, although we expect a long lead time. Essentially, the Government plans to move towards a single status of worker (i.e. merging the current statuses of ‘worker’ and ‘employee’ into one), resulting in a two-part framework that will distinguish between workers and the genuinely self-employed. 

However, any legislative changes in relation to employment status are unlikely to be implemented quickly, in part due to the huge complexity of the issues involved as well as the level of public consultation that will be needed. This is a vast area of employment law which has been under scrutiny for some time (for example, as part of Taylor Review back in 2017). Related changes to the UK tax system may also be necessary in due course.

We will of course keep our subscribers updated when further information becomes available.  In the meantime, we will be covering forthcoming legislative changes in more detail in our Spring Employment Law Updates. Click here to book your place.

If you are a Make UK subscriber, you can speak with your regular adviser and/or access further information in our HRL Resources. If you are not a Make UK subscriber, you can contact us for further support on this topic or to access our resources. Please click here for information on how we can help your business.