18.03.2026

The Employment Rights Act 2025 is not just an HR change. It affects the day-to-day decisions managers make and increases the risk attached to getting them wrong.

As a manager, you are not expected to read the legislation or understand tribunal case law. That is not your role. But you are expected to manage people fairly, consistently, and with clear evidence behind your decisions.

This guide explains what is changing, why it matters to you as a manager, and the key areas you should be paying attention to now

What changes, what matters, and what to do now

Unfair dismissal: earlier protection and higher potential cost

From January 2027 the qualifying period for unfair dismissal reduces from two years to six months, and the cap on unfair dismissal compensation will be removed. 

What this means for managers is that the “two-year comfort zone” disappears. Decisions made during probation will carry greater legal weight. Performance concerns cannot sit informally for months without documentation. Conversations need to be clear. Expectations need to be recorded. 

Informal management without structure will become higher risk. 

Tribunal claims: longer time limits

From October 2026, most tribunal claim time limits will extend from three months to six months.

This means your notes may be relied upon much later than before. Inconsistent treatment across teams becomes easier to challenge. Decisions made in the moment may be scrutinised long after the event.

Good record keeping stops being a helpful habit and becomes a protective measure.

Sexual harassment: stronger prevention duties

From October 2026 employers must take all reasonable steps to prevent sexual harassment, employers can be liable for harassment by third parties, and sexual harassment will qualify as a whistleblowing disclosure. 

This means managers cannot dismiss behaviour as harmless banter. Complaints that feel minor still require proportionate action. Failing to act may create liability, even where the conduct comes from customers, suppliers, or visitors. 

Culture and response matter just as much as policy wording.

Contract changes: tighter limits on fire and rehire

From January 2027, dismissing an employee for refusing changes to terms and conditions will be automatically unfair, with very limited exceptions.

This means commercial pressure does not remove legal exposure. Early consultation and meaningful engagement become critical. Rushed decisions around contractual change carry significant risk.

Flexible working: stronger justification required

Expected changes in 2027 will require refusals to be reasonable, evidence based and clearly explained in writing.

This means “It won’t work for the team” will not be enough. Managers will need to demonstrate genuine business reasoning, backed by facts. 

Zero and low hours arrangements: new safeguards

From 2027, employers will need to offer minimum hours based on a reference period, and short notice shift cancellations may require payment.

This means last minute changes to rotas could have financial consequences. Workforce planning becomes more important. Informal arrangements may need review. 

What increases risk under the new framework?

Under the Employment Rights Act 2025, risk increases when managers:

  • Avoid difficult conversations
  • Delay addressing performance concerns
  • Apply rules inconsistently across individuals
  • Refuse requests without clear evidence
  • Treat documentation as optional

Most claims do not arise from bad intent. They arise from uncertainty, inconsistency, or lack of structure. The Act raises the stakes around everyday management decisions.

A scenario to consider 

A manager dismisses an employee with seven months’ service following ongoing performance concerns. There are no formal review notes and no documented warnings.

Under the new framework, what risks might arise? Would the organisation be able to evidence fairness? Would the process withstand scrutiny?

These are the types of real-world situations managers will increasingly face.

Why this can also improve management practice 

While the reforms increase legal exposure, they also encourage clearer expectations, better communication and more consistent decision-making across teams. Many organisations find that when managers address issues early, document conversations properly and apply policies consistently, working relationships improve and disputes become easier to resolve.

In this sense, the Act is not only about avoiding claims. It is about strengthening everyday management practice and reducing uncertainty for both managers and employees. 

Where managers need practical support

As a manager you are not expected to interpret legislation. But clarity is needed on: 

  • What you can handle confidently 
  • When to escalate to HR 
  • What documentation protects both you and the organisation 
  • How to recognise early warning signs 

Our Employment Rights Act 2025 Training for Managers focuses on real workplace scenarios, decision points, and safe management practice. It is not legal theory. It is practical guidance to help managers make consistent, defensible decisions. 

The legislation may change in stages. But expectations of managers are changing now.