The Government has published commencement regulations bringing a number of provisions under the Employment Rights Act 2025 into force from April 2026. While not a full implementation of the Act, the changes coming into effect next month introduce immediate compliance obligations and increase exposure across several core employment risk areas.
The Employment Rights Act 2025 is being phased in through secondary legislation, most recently via the Employment Rights Act 2025 (Commencement No. 2 and Transitional and Saving Provisions) (Amendment) Regulations 2026. These regulations activate selected provisions from 6 and 7 April, with further measures expected to follow.
This update focuses on what is changing now, and where employers face immediate legal and operational impact.
Protective award exposure doubles in collective redundancy cases
From 6 April 2026, the maximum protective award for failure to comply with collective consultation requirements increases to 180 days’ gross pay per affected employee.This materially raises the financial risk attached to non-compliant redundancy processes. The protective award has historically been capped at 90 days, and tribunals have shown a willingness to award close to the maximum where consultation obligations are ignored or handled poorly.
The change increases the stakes in situations where employers:
- begin consultation too late
- fail to consult appropriate representatives
- approach consultation as a formality rather than a genuine process
The legal mechanism remains unchanged, but the consequence of getting it wrong is now significantly higher. For large-scale restructures, this shifts protective awards into a central financial risk rather than a secondary exposure.
Sexual harassment brought into whistleblowing framework
Disclosures relating to sexual harassment are now expressly capable of qualifying for protection under the whistleblowing framework where the statutory tests are met. This creates a new route for claims where individuals raise concerns about harassment in the workplace. In practice, this means disclosures about harassment may attract whistleblowing protection, individuals gain access to uncapped compensation if detriment or dismissal follows and claims may be framed as whistleblowing rather than solely discrimination.
The change therefore alters how complaints may be litigated and increases the potential for parallel claims. Employers dealing with harassment issues now face a broader legal risk profile, particularly where concerns are raised internally before formal grievances are submitted.
Trade union recognition process changes come into force
Provisions aimed at simplifying statutory trade union recognition procedures take effect from 6 April. While the detailed mechanics depend on how the Central Arbitration Committee applies the updated framework, the direction is clear. The changes are intended to make it easier for unions to secure recognition, particularly in borderline or contested cases.
For employers, this increases the likelihood of formal recognition applications, shorter or more streamlined recognition processes and reduced ability to resist recognition on procedural grounds.
The resulting risk is likely to be a gradual shift in how recognition disputes are handled and resolved.
New six-year annual leave record-keeping requirement
Employers are now required to retain records of annual leave for six years. This formalises what has previously been an implied obligation under working time law and case law. The explicit requirement aligns record-keeping with the limitation period for unlawful deduction from wages claims. The practical implication is straightforward. Employers should be able to evidence leave taken, leave accrued and holiday pay calculations.
Failure to retain adequate records will make it harder to defend claims relating to holiday pay, particularly where disputes arise several years after the relevant period. This is an immediate compliance issue. Systems that do not retain historical data at this level now present a litigation risk.
Fair Work Agency established with centralised enforcement powers
From 7 April 2026, the Fair Work Agency becomes operational as the UK’s central labour market enforcement body.
The Agency consolidates enforcement functions previously spread across multiple bodies, including minimum wage enforcement and labour exploitation oversight. Its remit is broader and more coordinated, with an emphasis on proactive enforcement.
For employers, this creates a different enforcement environment. Intelligence sharing between enforcement functions increases, investigations are likely to be more coordinated and non-compliance in one area may trigger scrutiny in others. It therefore represents a shift towards more integrated enforcement, with greater visibility across employer practices.
Notably absent: SSP reforms still pending
The regulations do not bring into force the widely anticipated reforms to Statutory Sick Pay, including the removal of waiting days and changes to the lower earnings threshold. These measures remain part of the broader reform package but require separate commencement regulations. As a result, they are not in force for April.
Employers should avoid implementing SSP changes prematurely. The current rules continue to apply until further regulations are published.
Immediate priorities ahead of April
In light of the upcoming changes, the immediate priorities for employers include:
- reviewing redundancy processes in light of increased protective award exposure
- updating whistleblowing and grievance frameworks to reflect expanded scope
- assessing readiness for union recognition activity
- ensuring annual leave record systems meet six-year retention requirements
- preparing for more coordinated enforcement through the Fair Work Agency
So while the April changes do not represent the full implementation of the Employment Rights Act 2025, they do introduce enough movement to warrant immediate attention, particularly where existing processes rely on assumptions that no longer hold under the updated framework.
The full regulations can be read here >
Author
Gill Laing is a qualified Legal Researcher & Analyst with niche specialisms in Law, Tax, Human Resources, Immigration & Employment Law.
Gill is a Multiple Business Owner and the Managing Director of Prof Services - a Marketing & Content Agency for the Professional Services Sector.
