The Employment Rights Act 2025, passed in December 2025, introduced wide-ranging changes that are now reshaping the employment law landscape. From 6 April 2026, the first major phase of implementation has taken effect, bringing important HR, operational and cost implications for small and medium-sized enterprises (SMEs), particularly where internal HR resource is limited.
In this update, we set out a practical checklist to help you review whether your policies, payroll processes and record-keeping reflect the changes now in force.
Paternity and Unpaid Parental Leave Become Day-One Rights
Paternity leave and unpaid parental leave are now available from day one of employment, removing the previous qualifying service requirements (26 weeks for paternity leave and one year for unpaid parental leave). There are no changes to paternity pay eligibility.
For smaller teams, this may mean family leave requests arise much earlier in the employment relationship, including during probation. This is likely to become more significant if the unfair dismissal qualifying period reduces to six months in January 2027.
Checklist for Employers
- Are HR and payroll aware that eligibility now starts from day one?
- Have your family leave policies or staff handbook been updated to remove service requirements?
- Can your business manage early leave requests without disrupting operations?
Statutory Sick Pay Changes
As of 6 April, Statutory Sick Pay is now available from the first full day of sickness absence, with waiting days removed. The Lower Earnings Limit has also been removed.
This extends entitlement, resulting in more workers being eligible and payments beginning sooner. For SMEs, this is likely to increase short-term absence costs, particularly where staffing is tight or there is reliance on part-time or lower-paid workers.
Checklist for Employers
- Has your payroll system been updated to calculate SSP from day one?
- Do your sickness absence policies reflect the new rules?
- Are line managers clear on the distinction between statutory sick pay and any enhanced sick pay?
- Do you have appropriate measures in place to monitor and manage short-term absence?
Bereaved Partners’ Paternity Leave
A new right now allows bereaved partners to take up to 52 weeks of Bereaved Partner’s Paternity Leave where a child’s birth mother or primary adopter dies within 52 weeks of the birth or placement.
This is a significant change and may require a careful balance between a compassionate response and operational needs, particularly in a smaller organisation without dedicated HR support.
Checklist for Employers
- Have your policies been updated to reflect this entitlement?
- Are managers equipped to respond consistently and appropriately?
- Is there a plan for temporary cover in critical roles?
Holiday Pay and Working Time
Employers are now required to keep adequate records showing compliance with annual leave entitlement and holiday pay rules, including leave and pay records for irregular-hours and part-year workers. Government guidance states that these records should be retained for six years.
Where systems are more manual, this may create a higher compliance burden and a greater evidential risk if records are incomplete or inconsistent.
Your records should clearly show:
- workers have received their full statutory entitlement
- holiday pay calculations, particularly for irregular-hours workers, are accurate
- carry-over rules are correctly applied
Checklist for Employers
- Are reliable systems in place to track leave accrual, usage and carry-over?
- Are payroll and leave records consistent and easy to evidence?
- Have your processes been clearly documented?
Fair Work Agency
The Fair Work Agency launched on 7 April 2026, bringing together enforcement across key employment rights. It may inspect businesses, review documentation and issue civil penalties for non-compliance.
This reflects a move towards more proactive enforcement, increasing the risk of inspection even where no employee complaint has been made.
Checklist for Employers
- Are your pay practices accurate, up to date and compliant?
- Can records be produced promptly if requested?
- Is someone clearly responsible for compliance within the business?
Sexual Harassment Disclosures Protected
From April, disclosures relating to sexual harassment are now explicitly protected under whistleblowing law. The Government has confirmed that sexual harassment has been added to the list of wrongdoings that can form the subject of a protected disclosure.
Where reporting structures are less formal, it is particularly important that complaints are handled correctly and escalated appropriately.
Checklist for Employers
- Do your whistleblowing or grievance policies cover sexual harassment disclosures?
- Do employees know how to raise concerns?
- Do managers understand when an issue may amount to a protected disclosure?
Minimum Wage Increases
Although not part of the Employment Rights Act 2025, minimum wage rates for 2026 increased from April as follows:
- Age 21 and over: £12.71
- Age 18 to 20: £10.85
- Age 16 to 17: £8.00
- Apprentices: £8.00
These increases continue to narrow the gap between age groups, with the longer-term aim of introducing a single adult rate. For your business, this may have a direct effect on payroll costs and may require changes to pricing, staffing or budgeting.
How Witan Solicitors Can Help
This is a challenging period for employers, particularly SMEs, who may need to adapt to multiple changes at once without in-house HR or legal support. A key reform still expected is the reduction of the qualifying period for unfair dismissal claims from two years to six months, in January 2027.
For advice tailored to your circumstances, Witan Solicitors’ employment law solicitors can help you review your policies, payroll processes and record-keeping arrangements in light of the new rules.
For further information and advice on how we may assist your business, please contact us on 0300 303 2071 or email us.
