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Employment Rights Act 2025: What Small Employers Must Do Now

Last verified: 7 October 2026

This is the Employment Rights Act 2025 small business checklist: every change that matters to a UK employer with 5–49 staff, arranged by deadline, with the one action each change demands. Work through it in order and you'll be ahead of the vast majority of businesses your size.

The Employment Rights Act 2025 (Royal Assent 18 December 2025 — yes, 2025, though you'll see people searching for "Employment Rights Act 2026" and we cover that term too) is the biggest rewrite of UK employment law in a generation. It arrives in waves, not all at once, which is both the good news and the trap: some changes are already live, some land in weeks, and the heaviest ones arrive on 1 January 2027.

This checklist is organised the way a busy owner needs it: do now (October 2026), check it's actually done (the April 2026 wave), do before January 2027, and ongoing habits. Each item tells you the date, who it hits, and the single action that matters most. Every section links to a deep-dive article where we unpack the detail.

How to use this Employment Rights Act 2025 small business checklist

Don't try to do everything this week. The checklist is ordered by deadline for a reason: items 1–3 have dates in October 2026, items 4–5 are "verify it's done" checks on changes already in force, items 6–8 have a January 2027 deadline you should start preparing for now, and items 9–11 are ongoing habits. If you only have one free afternoon, do items 1 and 2. If you have a full weekend, do 1 through 5. The January items need thinking time more than doing time — put them in the diary for November.

A note on what not to spend time on yet: several of the Act's headline measures — the higher bar for refusing flexible working, new statutory bereavement leave, the full zero-hours reform package — land later in 2027 and some detail is still being set in regulations. Know they exist (see item 11), but don't build processes around rules that aren't final. The October and January deadlines below are the ones with hard dates and real consequences.

Quick answer: is it the Employment Rights Act 2025 or 2026?

Both terms float around, and it's worth clearing up because it confuses almost everyone. The statute is the Employment Rights Act 2025 — that's the name on the legislation, which received Royal Assent on 18 December 2025. People search for "Employment Rights Act 2026" because that's when most of the changes actually bite: the 6 April 2026 wave, the 1 and 30 October 2026 deadlines, and the 1 January 2027 reforms. Same law, different shorthand. When you see "2026" in a headline, it almost always means the 2025 Act's implementation timetable.

Do now: October 2026

1. Harassment prevention duty becomes "all reasonable steps" — 30 October 2026

Hits: every employer, whatever your size. The one action: complete a workplace-specific harassment risk assessment, update your anti-harassment policy (with a third-party section), brief the team, and start an incident log. From 30 October, you must be able to show you took all reasonable steps to prevent sexual harassment — up from merely reasonable steps — and you can be held liable when a customer, client, contractor or supplier harasses your staff, with no prior incident needed before liability bites. Acas reported sexual-harassment helpline calls up 39% in 2025 versus 2024, so this isn't theoretical. Where a tribunal finds the preventative duty was breached, it can uplift compensation by up to a quarter — which is what turns a paperwork exercise into a financial one. Deep dive: Your Customers Can Now Cost You a Tribunal Claim: The 30 October Harassment Duty, including the 23-day playbook and sector notes for hospitality, retail, salons and care.

2. Tribunal time limits double from 3 to 6 months — 1 October 2026 (live)

Hits: every employer — it's already in force. The one action: tighten your record-keeping now, because claims can now arrive twice as far after the event. With the tribunal backlog past 70,000 single claims (up 51% year-on-year, April–June 2026 figures) and 71% of those involving firms with fewer than 50 staff, disputes that would once have timed out will now land on your desk. Practical file-keeping for small teams is not a nice-to-have anymore. Deep dive: What the 6-Month Tribunal Window Means for a 10-Person Business.

3. Written statement of trade-union rights for new joiners — 30 October 2026

Hits: every employer hiring staff. The one action: add a short written statement of trade-union rights to your new-starter paperwork. This is one of several union-related measures landing on the same date as the harassment duty. It won't occupy much of your week, but it needs to be in the starter pack. Deep dive: the union measures are covered in our ERA timeline.

Check it's actually done: the April 2026 wave

These changes are already in force and you may have handled them months ago — but if your business only has one person doing HR (or nobody), "handled" sometimes means "heard about and meant to get to." Verify each one.

4. Statutory sick pay from day one — in force 6 April 2026

Hits: every employer; 1.3 million workers became newly eligible and the DWP puts the added employer cost at roughly £450 million a year across the economy. The one action: confirm your payroll is actually paying SSP from the first day of absence (no waiting days, no lower earnings limit) and that your absence policy says so. 43% of employers told Acas/YouGov (February 2026) that day-one SSP was the single biggest-impact change of the whole Act — for small businesses with tight margins, this is the one that shows up in cash flow. Check the current weekly SSP rate on gov.uk before quoting figures to anyone. Deep dive: Statutory Sick Pay from Day One: What It Costs a Small Employer.

5. Day-one family leave rights — in force 6 April 2026

Hits: every employer with staff who might take paternity, parental or bereavement-related leave. The one action: check your leave policies no longer impose qualifying service periods where the Act removed them. This is a paperwork check more than a behaviour change — but outdated policies are a classic source of grievances. Deep dive: the ERA timeline.

Do before 1 January 2027: the heavy wave

January 2027 is where the Act's cost and risk profile changes most for small employers. You have roughly three months from now. Use them.

6. Unfair-dismissal qualifying period: 2 years → 6 months — 1 January 2027

Hits: every employer with staff. An estimated 6.3 million employees will be newly covered by unfair-dismissal protection, and the government expects roughly 3,000 extra tribunal claims a year (Government Economic Analysis, January 2026). The one action: redesign your probation and early-employment management now — six months is a very short window to assess a new hire, especially in technical roles, and statutory notice can count toward the qualifying period. Don't leave decisions about struggling new starters until mid-December; the safest reading is to act well before the cut-off with proper process. Deep dive: Probation Periods in 2027: Rethinking the First Six Months.

7. Unfair-dismissal compensation cap removed — 1 January 2027

Hits: every employer, but it bites hardest on small ones. The one action: understand that getting a dismissal wrong can now cost far more than the old capped amount — compensation for financial loss becomes unlimited — and price that risk into how seriously you take fair process. For a small business, one badly handled dismissal could be an existential bill. This is the single biggest argument for getting your disciplinary and capability procedures written down and followed. Deep dive: Probation Periods in 2027 covers how the cap removal interacts with the new qualifying period.

8. Fire-and-rehire restrictions — 1 January 2027

Hits: any employer that changes terms and conditions by dismissing and re-engaging. The one action: if you have any reorganisation, contract changes or harmonisation of terms on the horizon, take advice before using dismissal-and-re-engagement as the mechanism — the Act heavily restricts it and makes such dismissals automatically unfair in many cases. Genuine consultation about the change, done properly and documented, is the route that stays open. Deep dive: The Fire-and-Rehire Ban: What It Means from 2027.

What it costs to ignore the checklist

Nobody likes the scare-tactics version of compliance content, so here's the plain arithmetic instead. A single employment tribunal claim against a small business typically costs several thousand pounds in legal fees even when you win — and "winning" takes months of your time. Lose, and from 1 January 2027 the compensation for unfair dismissal is uncapped, the harassment preventative-duty breach carries an uplift of up to 25%, and awards in discrimination cases have no cap at all. The tribunal backlog (70,000+ claims and counting) means you pay those costs while waiting a year or more for a hearing date. Against that, the entire October programme — a risk assessment, a policy update, a team briefing, an incident log, a folder system — is a few hours of focused work. It's the cheapest insurance your business will ever buy.

Ongoing: the habits that keep you out of trouble

9. Keep employment records as if a claim is coming

The six-month tribunal window, the 6-month dismissal qualifying period, and the uncapped compensation all point the same way: your paperwork is your defence. Contracts, probation reviews, absence records, disciplinary notes, the harassment incident log — kept consistently, dated, and retrievable. The practical system for a team without an HR department is in the 6-month window article.

10. Review policies on a schedule, not after a crisis

"All reasonable steps" on harassment, fair process on dismissal, accurate SSP and leave policies — none of these survive contact with a policy written in 2024 and never revisited. Put an annual review date in the calendar (January works: it lines up with the Act's amendment cycle) and treat it like a tax deadline.

11. Watch the 2027 tail

More changes arrive later in 2027 — zero-hours and low-hours worker rights (guaranteed hours offers, shift notice and cancellation pay), a higher bar for refusing flexible working requests, and statutory bereavement leave among them. If you use zero-hours or casual staff, start mapping their actual working patterns now: hours worked per week over recent months, shift-notice practices, how often shifts are cancelled or moved at short notice. The guaranteed-hours provisions will apply directly where people already work regular, predictable hours, so this audit doubles as your 2027 preparation and your current workforce planning. Agency workers on variable hours need the same treatment — in some cases the end-user client, not just the agency, will carry the obligation. Dates and detail are in the ERA timeline.

Questions owners actually ask

Does this really apply to my 6-person business? Yes. Almost none of the Act's employer duties have a small-business exemption — the harassment duty, the tribunal window, day-one SSP, and the 2027 dismissal changes all apply from your first employee. The government's own figures show 71% of tribunal claims involve firms with fewer than 50 staff. Being small doesn't reduce your exposure; if anything, it concentrates it.

What about contractors and freelancers? Some parts of the Act reach beyond employees — the zero-hours and agency-worker reforms explicitly do, and harassment protections can cover a wider group of workers than unfair-dismissal rights. If your business runs on contractors, don't assume "they're not employees" ends the analysis. Map who does what work for you, on what terms, and check each change against that map rather than against job titles.

Do I need a solicitor, or can I do this myself? The October programme — risk assessment, policy update, team briefing, incident log, file folders — is genuinely doable yourself; that's what this checklist and the templates in the Compliance Pack are for. Bring in a solicitor for the decisions where getting it wrong is expensive: dismissals from January 2027, any restructuring or contract changes, and any live dispute or claim. A one-hour advice call before a dismissal is a rounding error next to defending one.

Where do I check dates and rates as they change? gov.uk for statutory rates (SSP, tribunal award limits) and Acas for guidance updates. Some of the 2027 detail is still being set in regulations, so treat any single source — including this site — as a snapshot dated by its "last verified" line, not as the final word.

Your October weekend plan

If the full checklist feels like a lot, here's the condensed order of operations for a single weekend. Saturday morning: the harassment risk assessment (one page, your own words, dated). Saturday afternoon: update the anti-harassment policy and start the incident log spreadsheet. Sunday morning: brief the team — thirty minutes, attendance list, filed with the policy — and send the short note to regular suppliers and contractors. Sunday afternoon: create one folder per employee and file whatever contracts, reviews and absence notes you can find, with today's date on everything new going forward. Monday: add the trade-union rights statement to your starter paperwork and check payroll is paying day-one SSP. That's items 1 through 5 done. Put a November date in the diary for the January 2027 probation redesign, and you're running the programme, not chasing it.