Preparing for the most significant employment law reforms in over a decade
The Employment Rights Act 2025 (“ERA 2025”) will introduce wide‑ranging reforms to UK employment law, affecting everything from statutory leave to dismissal rights, trade union engagement, record‑keeping and working time. For SMEs—particularly those without recognised trade unions—the volume and pace of change can feel daunting.
To help organisations prepare, we’ve set out a practical, step‑by‑step implementation timetable covering what’s coming, when, and what actions SMEs should take now.
Why SMEs need to act early
A number of the changes take effect from 6th April 2026, with more arriving in October 2026 and 2027. Several measures significantly increase legal exposure—for example:
- Automatic unfair dismissal protections from 6 months
- Uncapped compensation for unfair dismissal from 2027
- Stricter harassment prevention duties
- Expanded rights for variable‑hours workers
- Enhanced union access and new onboarding obligations
SMEs with lean HR functions will particularly benefit from early preparation.
Implementation timetable – preliminary notes
Where an organisation does not have a recognised trade union and is unlikely to see an appetite for recognition, most of the trade union‑related changes will have limited relevance—particularly for smaller employers with fewer than 20 employees.
The main union related points that will still apply are the new notification duties, access rights, and changes to collective consultation thresholds.
Where “TBC” appears in the timetable, organisations should begin preparing in principle now but hold off on making final policy or contractual changes until the commencement regulations are published.
To download the timetable, please click on the link below:
ERA 2025 – SME Timetable [PDF file]
Immediate priorities for Q1-Q2 2026
- Policy and contract review Update: SSP, Paternity/Parental Leave, Whistleblowing, Harassment (add “reasonable steps” programme plan), Union Relations/ Access, Change management (fire‑and‑rehire), Flexible Working workflows – prepare for reasonableness test and written reasons for refusal.
- Payroll/HR configuration (by April 2026) SSP day‑one; leave calculation processes; shift‑notice/cancellation preparation; record‑keeping for holiday pay; reporting to support future FWA interactions.
- Manager training Early‑service performance handling (anticipating six‑month unfair dismissal threshold from January 2027); handling union interactions under the new rules; preventing/handling harassment (including third‑party).
- Workforce and rotas Map all zero/low‑hours roles; consider trialling guaranteed hours offers and reasonable shift‑notice processes now to prepare for 2027 changes.
- Board and budget Flag increased litigation exposure from uncapped unfair dismissal awards and longer 6‑month limitation periods (from Oct 2026 for most claims). Build a reserve for policy rollout and training.
The scale and pace of the ERA 2025 reforms mean that most employers will need to start preparing well in advance. If you’re unsure how any of these changes apply to your business, or would like practical guidance on next steps, our team at Lindsays would be happy to support you.
Published 11 February 2026
