Key Insights from the UK Employment Rights Consultation

Key Takeaways

• Day-One Protections: Employees gain unfair dismissal protection from day one, significantly increasing employer accountability from the start of employment.
• Redundancy Risk Shift: Collective consultation triggers will apply across the entire organization and protective awards double to 180 days’ pay, raising the stakes of workforce reductions.
• Stronger Parental Security: Pregnant employees and new parents receive expanded dismissal protections through leave and return periods, with key parental rights becoming day-one entitlements.
• Harassment Accountability: Employers become directly liable for harassment by third parties, requiring proactive controls and stronger safeguards for frontline staff.
• GRC Impact: With crucial details still under consultation, organizations must prepare now to adjust governance, HR policies, and internal controls to meet the Bill’s evolving requirements.

Deep Dive

The UK has recently published a series of consultation papers pertaining to its Employment Rights Bill, originally introduced in October 2024 as a sweeping reshaping of UK employment law. These papers aim to clarify the goals and practicalities set out by the original, as yet codified, legislation.

While the Bill is being pushed through as a cornerstone reformation effort towards employment laws in the UK. However, Many of its most consequential changes, such as protections against unfair dismissal, particularly regarding new mothers, are not totally defined in the legislation itself. These papers are designed to facilitate feedback to, and to clarify the intent behind these provisions.

For organizational leaders, the bottom line question remains, what timeframe will an organization have to operationalize these provisions, and at what cost. From a governance perspective, the consultations underscore just how much of the Bill’s true impact will ultimately be shaped outside the primary legislation itself. As regulators use these papers to test assumptions, gather evidence, and refine the scope of key provisions, organizations are left watching not only what changes are proposed but how the government interprets risk, fairness, and proportionality across the employment landscape. This dynamic places heightened importance on regulatory clarity, consistency, and the eventual articulation of enforceable standards.

For GRC professionals, the consultations serve as an early signal of where enforcement priorities may emerge, which areas remain contested, and how the evolving regulatory environment may recalibrate expectations for oversight, accountability, and internal controls across the UK workforce.

Key components of the bill cluster around several themes focused on protecting workers in a myriad of difficult scenarios.

Fair Dismissal and Structural Change

Under current regulations, employees typically are required to have worked a 2-Year qualifying period of continuous service to claim ordinary unfair dismissal. The new Employment Rights Bill would grant employees the right to protection from unfair dismissal from day one. The reduction of the 2-year qualifying period all but closes the window in which an unfair dismissal could take place without significant recourse.

Employers are still permitted to use contractual probationary periods, likely covered by the new statutory 'initial period'  of an expected 9 months, during which a 'lighter touch' dismissal procedure would apply. This process, which specifically references situations in which the employee fails to meet the requirements of the job (capability) or demonstrates misconduct, effectively isolates 'bad hire' scenarios from situations that require stricter review.

New provisions also focus on large scale workforce reductions, incentivizing organizations to focus on growing sustainably by effectively doubling the financial risk to employers who expand and then contract recklessly. Current law requires a guaranteed 90 days pay and if more than 20 redundancies are proposed at a single site the organization must take part in collective consultation.

The new law would double the protective award to 180 days pay, the Bill adds a new trigger requiring consultation if a certain number or percentage of redundancies is proposed across all sites/the business as a whole. This is a major procedural shift for multi-site employers. They will need to track small redundancy numbers across their entire organization, as the combined total may now trigger the consultation requirement.

Ultimately, these reforms promote job security by forcing employers to act carefully and deliberately at all parts of the employment lifecycle and take greater responsibility for the jobs they provide, making redundancies and mass layoffs a less accessible tool, placed behind a thicker wall only to be broken in case of emergency, and incentivizing organizations to evolve holistically.

The Employment Rights Bill also creates a robust safety net for new and expectant parents by significantly enhancing job security and making critical leave rights available from day one. To combat the pervasive “returner penalty,” the Bill introduces enhanced protection against dismissal during redundancy.

Previously, priority for suitable alternative employment applied primarily during maternity leave; the new law extends this protection to pregnant employees and for a crucial period of six months after a parent returns to work from maternity leave. This enhanced security is also extended to employees taking adoption leave and those taking six consecutive weeks or more of Shared Parental Leave.

Furthermore, the Bill removes service barriers for new parents, making key rights immediately accessible: Paternity Leave and Unpaid Parental Leave will become "day one" rights, eliminating the current 26-week and one-year qualifying periods, respectively. Collectively, these reforms seek to provide financial and occupational security, fundamentally changing the risk calculation for employers when dealing with employees who are starting or expanding their families.

Again, these changes promote better care in organizational structure and incentivizes leaders to more wholly integrate family needs into their workplace and culture. Under normal circumstances, new parents often find their way back to typical working conditions. But during these times of elongated leave and personal priority shifts, new parents are particularly vulnerable to organizational change, or become easy targets for workplace reduction. These new regulations attempt to protect and promote new families by shifting some of the burden to employers to carefully design employment opportunities that are conducive to new families.  

Accountability and Conduct

The overarching goal of this theme is to significantly strengthen the employer's duty of care and accountability regarding harassment and discrimination, both internally and externally. It expands the organization’s role in protecting employees from harmful behavior from a wider range of potential abuses from a broader selection of possible offenders.

The Bill introduces a direct liability on employers for harassment of their employees by third parties, such as clients, customers, suppliers, or workplace visitors. The scope of the new law moves to encompass all forms of abuse towards a protected characteristic from nearly any party that an employee might encounter during the course of their work. The tolerance for any offense has also been shortened, making the organization liable from the first offense should their measures be found to be ineffective.

This is a major procedural and cultural shift. It forces businesses, especially those in retail, hospitality, transport, and customer-facing roles where navigating difficult interpersonal relationships on behalf of the organization is an implied responsibility, to conduct rigorous risk assessments for third-party contact. Employers must now proactively implement visible steps—such as clear contracts with suppliers/clients that mandate respectful conduct, strong staff training on incident reporting, and zero-tolerance policies that managers are empowered to enforce against customers.

Banning Abusive NDAs

The Bill addresses the misuse of Non-Disclosure Agreements by rendering null and void any agreement that could be used to prevent a worker from making an allegation or disclosure of information relating to harassment or discrimination. This prohibition covers both the initial allegation and the employer's subsequent response to the misconduct.

While NDAs remain valid for protecting legitimate commercial interests like trade secrets, they can no longer be reliably used as a vehicle to minimize the impact of misconduct cases. This change removes a key tool for managing reputational and financial risk, removing what was once a possible route of impunity, and forcing organizations to address allegations transparently and decisively through immediate, thorough investigation and remediation. This also recenters the use of an NDA closer to its intended purpose to protect valuable organizational information.

Operationalizing the Risk

More than a modest adjustment, the UKEmployment Rights Bill is a foundational rewrite of many blind spots underlying the employment contract. Placing a greater responsibility to provide stability, safety, and fair treatment for workers.

For organizational leaders and GRC professionals, the true task lies in translating the Bill’s broad intent into enforceable policies.

Because much of the detail will be defined in secondary legislation via these ongoing consultations, organizations must be proactive in reviewing and updating internal controls, HR policies, and risk registers in light of the regulatory signals presented. Tools for protecting the organization must be recalibrated away from potentially abusive tools or those with a high negative impact on workers, such as NDAs or mass layoffs, in favor of more holistic and mutually beneficial measures.

Ultimately, the Bill suggests a cultural shift towards a more socially responsible employer. The move to "day one"rights for unfair dismissal and parental leave requires management to integrate fairness and accommodation into every stage of the employment lifecycle, while ensuring heavier handed measures are used solely within their scope and intention. This new environment demands that organizations move beyond simply complying with the law to actively fostering a healthy and productive environment for all employees from their very first day.

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