Workers’ Rights Bill: Employment Law Changes Taking Effect in 2026
The Employment Rights Bill, delivering the most comprehensive expansion of workers’ protections in the United Kingdom in a generation, has been progressing through Parliament and beginning to take effect through 2026, implementing a programme of reforms that Labour had committed to during the 2024 general election campaign and that represented a significant recalibration of the balance between employer flexibility and worker security in British employment law.
Among the most significant changes are provisions making unfair dismissal protections effective from day one of employment, ending the existing two-year qualifying period during which employers could dismiss staff without providing a reason. The removal of the qualifying period addresses a long-standing criticism that the threshold created a class of unprotected workers in the early months of their employment who could be dismissed arbitrarily, and was particularly significant for those in sectors characterised by high turnover and short-tenure employment relationships.
Restrictions on fire and rehire practices — where employers dismiss staff and offer them re-engagement on inferior terms and conditions — were also included in the legislation. The practice had attracted intense public criticism when used by a number of major employers during the pandemic period and in subsequent years, with the legislation creating new remedies for workers subjected to it and constraining the circumstances in which employers could lawfully use the approach.
Trade unions broadly welcomed the Bill as a substantial step towards the more balanced employment relations framework they had been advocating for years. Employer organisations, including the CBI and FSB, expressed concern that the cumulative regulatory burden — combining the workers’ rights changes with minimum wage increases and national insurance cost rises — was creating significant headwinds for businesses already managing elevated energy and supply chain costs in the Iran war aftermath.
