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Employment Rights Act Changes: What Employers Need to Know
HGA Takeaway
Employment Rights Act Changes: What Employers Need to Know
From longer tribunal time limits and stronger harassment protections to major changes around unfair dismissal, probation periods and zero hours contracts, here's what businesses should be preparing for.
Employment law is changing, and for employers the message is pretty simple: don't wait until 2027 to start preparing.
In this Acas session, the team talked through the Employment Rights Act changes being implemented in October 2026, what's still to come before the end of the year and some of the significant changes businesses need to prepare for in 2027.
Some of these changes will have an immediate impact on how businesses handle workplace issues. Others give employers an opportunity to review their processes now, particularly around recruitment, probation, record keeping, harassment, working hours and dismissal.
The businesses in the strongest position will be the ones reviewing their policies and processes before they actually need to use them.
Takeaway 1
Employment tribunal time limits have doubled
From 1 October 2026, workers have six months to bring an employment tribunal claim where the issue being claimed for took place on or after that date.
Previously, the time limit for bringing many tribunal claims was three months. For employers, this means workplace issues could potentially develop into claims much later than they did previously.
What does that mean in practice?
Good record keeping becomes even more important. Notes, emails, investigation records and other relevant information may need to be relied upon months after an incident took place.
Takeaway 2
Good investigations and accurate records matter even more
A longer period for bringing a claim also means more time for memories to fade.
The Acas session highlighted the importance of conducting good investigations and keeping accurate records at the time an issue occurs, rather than trying to reconstruct what happened several months later.
If it matters now, record it now. Don't rely on somebody remembering the details six months later.
Takeaway 3
Employers must take all reasonable steps to prevent sexual harassment
Employers already had a legal duty to prevent sexual harassment following changes introduced in October 2024.
From October 2026, the requirement is strengthened so employers must take all reasonable steps to prevent sexual harassment.
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PREVENT Consider what could cause harassment in your workplace and take steps to stop it happening in the first place. |
REPORT Make sure workers know how and where to report concerns. |
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RESPOND Have a clear process for responding appropriately and supporting workers who report harassment. |
REVIEW Don't treat the policy as a one off exercise. Review whether the measures you've introduced are actually working. |
Takeaway 4
Third party harassment matters too
This is particularly relevant for businesses whose employees regularly interact with customers, suppliers, visitors or other third parties.
From 30 October, an employer can be responsible for harassment by third parties unless they have taken all reasonable steps to prevent it.
Acas suggests employers could consider things such as:
Displaying notices making it clear that abusive, discriminatory or harassing behaviour will not be accepted
Warning customers that they could be removed or banned if they harass workers
Assessing workplace risks, including situations such as lone working
Takeaway 5
Some important changes have already happened
October isn't the beginning of the Employment Rights Act changes. Employers should also make sure they're up to date with measures introduced earlier in 2026.
Changes highlighted by Acas include:
Statutory sick pay: paid from day one of absence, with the lower earnings limit removed.
Paternity leave: employees eligible from day one.
Ordinary parental leave: employees eligible from day one.
Annual leave records: employers have been required to keep records from 6 April 2026.
Protective awards: doubled to 180 days.
Takeaway 6
2027 brings a major change to unfair dismissal
From 1 January 2027, employees will be able to claim ordinary unfair dismissal once they have worked for their employer for six months.
The compensation cap for unfair dismissal claims will also be removed. Day one automatic unfair dismissal rules remain unchanged.
One date worth knowing
Acas explains that any employee who has been employed since at least 1 July 2026 will have reached six months' service by 1 January 2027 and will therefore be able to claim ordinary unfair dismissal.
Takeaway 7
Now is the time to rethink probation periods
The reduction in the qualifying period for ordinary unfair dismissal makes those first few months of employment even more important.
Acas emphasised that dismissal should be a last resort and that many problems can be avoided through better recruitment, good inductions and properly designed probation periods.
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RECRUIT WELL Be clear about the skills and behaviours you actually need before somebody starts. |
TRAIN WELL Give new starters the induction, information and training they need to succeed. |
MANAGE WELL Use probation properly, give feedback early and allow people a reasonable opportunity to improve. |
Takeaway 8
Don't use probation as a substitute for good management
The webinar used the example of a café employee who was dismissed after a one month probation because customers complained about the sandwiches they were making.
The employee hadn't been there long enough to claim ordinary unfair dismissal, but Acas highlighted that the employer could have provided more training, given more feedback or agreed a longer probation period.
A probation period should help somebody become a confident, independent member of your team, not simply give you a date to decide whether they stay or go.
Takeaway 9
All employers will have a new trade union information requirement
From 1 January 2027, all employers must provide workers with a statement informing them of their right to join a trade union.
According to the Acas session, this will include information about the functions of trade unions, recognised unions, statutory access agreements, the Certification Officer's list of trade unions and a summary of statutory rights relating to unions.
Takeaway 10
Fire and rehire is changing
The legislation also introduces significant restrictions around dismissing an employee who refuses certain changes to their employment terms.
It will be automatically unfair to dismiss an employee for refusing a restricted variation in areas including pay, working hours, holiday entitlement, pensions and shift patterns where the dismissal is being used to employ someone else, or rehire the employee, on the new terms.
There are limited circumstances where changes may still be possible
The webinar explains that an employer would need to show the changes were unavoidable and were intended to eliminate, prevent, reduce or mitigate severe financial difficulties affecting the viability of the business.
The dismissal would still need to be fair in the circumstances, including consideration of consultation and whether the employee was offered an incentive to agree.
Takeaway 11
Zero hours and irregular hours contracts are changing too
This could be particularly relevant to retailers and other businesses using flexible staffing arrangements.
The changes introduce new rights around guaranteed hours, notice of shifts and compensation when shifts are changed at short notice.
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GUARANTEED HOURS Offers of guaranteed hours reflecting a worker's typical pattern of work. |
SHIFT NOTICE A right to reasonable notice of scheduled shifts and changes to shifts. |
COMPENSATION Compensation where a shift is cancelled, cut short or moved at short notice. |
Start preparing now
Acas recommends employers review their use of zero hours and low hours contracts and think about how workers are currently notified of shifts.
Takeaway 12
More family and equality changes are on the way
The webinar also highlighted a number of further changes coming in 2027.
Gender equality: mandatory action plans, including supporting workers through the menopause.
Bereavement leave: including following pregnancy loss before 24 weeks.
NDAs: non-disclosure agreements becoming void in some circumstances.
Pregnancy and maternity: enhanced dismissal protections for pregnant women and new mothers.
Flexible working: further rights alongside a new code of practice.
Put it into practice
What should employers be doing now?
You don't need to wait for every 2027 change to arrive before preparing. There are some sensible things employers can review now.
1. Review your record keeping
Check how long relevant employment information is retained and whether your records would allow you to respond properly to a tribunal claim several months later.
2. Carry out a harassment risk assessment
Think about where harassment could occur, including interactions with customers and other third parties, and what reasonable preventative steps you can take.
3. Review recruitment and probation
Make sure new employees have clear expectations, proper training, regular feedback and enough time to demonstrate whether they're right for the role.
4. Look at contracts and shift arrangements
If you use zero hours, low hours or irregular working arrangements, start reviewing how hours and shifts are currently managed.
5. Keep reviewing your policies
Employment law is moving quickly. Make sure whoever is responsible for HR or people management in your business knows what's changing and when.
For Home & Gift businesses
Don't assume this is only an issue for big employers
Many businesses across the Home & Gift industry have relatively small teams, and that can sometimes mean HR processes are more informal.
That informality can be part of what makes a small business a lovely place to work, but it shouldn't mean important conversations, decisions and processes aren't documented properly.
For retailers in particular, the changes around third party harassment and irregular hours could also be especially relevant where employees work directly with the public or where staffing levels change throughout the year.
A quick sense check for your business:
Are your employment policies up to date?
Could you find accurate records of an incident six months later?
Do staff know how to report harassment?
Have you considered harassment from customers and other third parties?
Are probation periods genuinely helping you assess and develop new starters?
Do you use zero hours, low hours or irregular working arrangements that need reviewing?
The HGA Takeaway
Don't wait for a problem before reviewing your processes
1. Employment tribunal time limits have increased from three to six months for relevant issues occurring from 1 October 2026.
2. Accurate investigations and record keeping are more important than ever.
3. Employers need to take all reasonable steps to prevent sexual harassment.
4. Think about harassment by customers and other third parties, not just colleagues.
5. From January 2027, ordinary unfair dismissal protection moves to six months' service and the compensation cap is removed.
6. Recruitment, induction, training and probation processes deserve attention now.
7. Businesses using zero hours or irregular hours arrangements should start reviewing how they manage hours and shifts.
One thing to do this week
Pick one of your employment policies and check when it was last reviewed.
If the answer is "I'm not actually sure", that's probably a pretty good place to start.