Time to Prepare for the Employment Rights Bill

Business News Wales

a day ago

At long last, the Employment Rights Bill (ERB) has a clear implementation roadmap.
Welsh businesses finally have the clarity they need to plan proactively. With concrete dates to work towards, this isn't just about ticking boxes, it's about preparing tomorrow's workforce today.
The question now isn't what's coming — it's what should employers in Wales do next?
Understanding the Employment Rights Bill
The ERB brings major changes, especially affecting sectors like tourism, retail, care, and hospitality, which rely heavily on flexible working arrangements.
Here are the key measures and implementation dates:
Immediately following Royal Assent Repeal of the Strikes (Minimum Service Levels) Act 2023 and most of the Trade Union Act 2016
New legal protections against dismissal for participating in industrial action
April 2026 Doubling the maximum protective award for collective redundancies (currently 90 days' uncapped pay per employee)
Introduction of 'Day 1' paternity leave and unpaid parental leave rights
Enhanced protections for whistleblowers
Establishment of a new Fair Work Agency
Improvements to Statutory Sick Pay, including removal of the Lower Earnings Limit and the waiting period
Simplified processes for trade union recognition
Electronic and workplace balloting
October 2026 Ban on controversial 'fire-and-rehire' practices, save for in limited circumstances
Launch of a Fair Pay Agreement Negotiating Body for the adult social care sector
Strengthened laws on tipping practices
Duty to inform workers of their right to join a trade union
New employer duty to take 'all reasonable steps' to prevent sexual harassment
Extended trade union rights, including new rights and protections for trade union reps
2027 Gender pay gap and menopause action plans (voluntary from April 2026)
New rights for pregnant workers
New rights for bereavement leave
Protections against zero-hours contract abuse, including for agency workers
Regulation of umbrella companies
Introduction of 'Day 1' unfair dismissal rights
1. Zero-hours contracts
Zero-hours contracts will face new restrictions. Qualifying workers will have the right to be offered guaranteed hours, based on average hours worked over a typical 12-week period. Employers will also need to provide reasonable notice of shifts and compensate workers if shifts are cancelled or changed without reasonable notice.
Employers should start by: Auditing current zero-hours and agency workers: who are your zero-hours workers? How often are shifts cancelled? Are you at risk of breaching future notice and payment requirements?
Mapping out hours worked, reviewing existing terms, and assessing how many staff may soon qualify for new rights
Updating employment contracts and policies accordingly – and communicating these changes transparently
Preparing to offer more predictable schedules to build trust and long-term loyalty.
2. Unfair dismissal rights
The ERB will make unfair dismissal protection a day one right, removing the current two-year service qualifying period. This increases the legal risk of early-stage dismissals, including those during probation. Employers will need to follow fair procedures from the outset, with clear documentation and rationale for any termination.
With unfair dismissal set to become a day one right, employers may no longer be able to rely on a probation period or length of service as a buffer against legal claims.
Now is the time for employers to: Review and tighten recruitment, induction, and dismissal procedures
Train line managers to document performance concerns clearly and follow fair, consistent processes
Update disciplinary and probationary policies to ensure procedural fairness from day one.
Above all, early dismissals should no longer be seen as informal or low-risk; every decision must be justifiable, evidence-based, and fully compliant with the new provisions.
3. Statutory Sick Pay (SSP)
The ERB removes the three-day waiting period for SSP, making it payable from the first day of illness. This will impact payroll and sickness reporting systems.
Employers will need to: Update payroll, absence procedures, and internal communications to reflect this change
Remove waiting period references from contracts and handbooks
Standardise sickness reporting, ensuring clear employee notification and manager recording processes
Verify systems can accurately track absences and statutory entitlements.
Unpacking the Fair Work Agency (FWA): what will the new state enforcement agency for employment rights mean for HR teams from April 2026?
For the first time, a single enforcement body will proactively monitor compliance with key entitlements such as holiday pay, statutory sick pay, minimum wage, and protections for zero-hours workers. The FWA will have the authority to inspect employers, request records, issue penalties, and act independently.
For HR teams, this raises the bar on compliance. Accurate record-keeping, consistent processes, and contract clarity will be essential. Holiday pay calculations, especially for variable-hours staff, must be precise. Sickness and absence tracking should be standardised, and payroll systems must be watertight. Sectors such as hospitality, care, and retail – with higher use of casual labour – will be especially exposed to enforcement.
With the ERB timeline now clear, there's no time to delay. By preparing now, employers can build stronger workplaces and stand out as responsible, future-ready leaders in the evolving UK economy.