Employers are being urged to future proof their employment policies ahead of the introduction of new legal obligations which are expected to become law in time to come.
The Employment Rights Bill is currently in the committee stage, with proposed changes including unfair dismissal, an end to fire and rehire, zero-hour contracts, and flexible working.
Rather than reacting to modifications as they happen, employers should take a proactive approach, says employment specialist Paula Squire from national law firm Clarke Willmott LLP.
“Active planning will set businesses up for success and ensure they remain compliant and competitive in an ever-shifting landscape,” said Paula, Partner, in the firm’s employment team.
“Greater focus on well-drafted contracts is essential to ensure legal compliance, clarify expectations, prevent disputes, and adapt to evolving workplace regulations.”
Paula says in the case of unfair dismissal the Employment Rights Bill introduces significant changes, including day-one rights, with plans for the current two-year qualifying period to be removed.
“The bill introduces an Initial Period of Employment (IPE) with simplified dismissal procedures for issues like poor performance, misconduct, or capability.”
“There is suggestion this may be a period of six to nine months and the Government has confirmed that employers will retain the ability to run separate contractual probationary periods.”
“Our view is that this significant change will result in more employees having unfair dismissal rights.”
“When the change comes into force, employers will need to make sure they get their recruitment right and act quickly to consider if the employment is not working out.”
In the case of an end to fire and rehire, Paula says the proposed legislation goes further than first thought and that the practice is set to be banned in all but the most extreme cases.
“Employees who feel they were unfairly dismissed or forced into unfavourable contract changes may be more likely to pursue legal claims,” she added.
“This means employers will need to think ahead to the employment contracts at the outset, building safeguards into the contracts rather than rely on justification for fire and rehire.”
The proposals will also impact workers on zero-hour or low-hour contracts by requiring employers to offer contracts that reflect the hours they regularly work, says Paula.
“This would ensure individuals are guaranteed a minimum number of hours, based on the hours they worked in previous weeks. It is anticipated that this may involve a 12-week reference period.
“The definition of “low hours” is yet to be determined, but the requirement aims to prevent employers from using it as an anti-avoidance measure.
“Workers will have the right to bring a claim in the Employment Tribunal if a contract is not offered.”
In addition, the Bill will also seek to ensure flexible working is the default position for employees unless an employer can prove that flexible working is unreasonable.
“The Bill states that an employer will need to state the grounds for a refusal to a request and explain why they consider it reasonable to refuse.”
“The right to request flexible working is already a ‘day one’ entitlement, but the proposed changes would give employees more grounds to challenge how their requests are handled, potentially leading to more homeworking requests if office attendance increases.”
The Employment Rights Bill is expected to become law in the middle of 2025, however the majority of the reforms will take effect no earlier than 2026, with the unfair dismissal reforms expected to be implemented no sooner than Autumn 2026.
“Adapting to new legal obligations can seem daunting,” said Paula, “but with the right tools in place, employers can simplify the process and ensure their workplace is both compliant and inclusive.”
Paula is a partner and head of the Taunton employment team, which is ranked Band 1 for Employment in the South West by the Legal 500.
Clarke Willmott LLP is a national law firm with offices in Birmingham, Bristol, Cardiff, London, Manchester, Southampton, and Taunton.
