Employment Edit: 11 June 2026

Legal updates

Unfair dismissal reforms

Big ERA news….we now have a confirmed commencement date for what is arguably the most significant set of reforms under the Act. The two major changes to unfair dismissal claims – a reduction in the qualifying period from two years’ service to six months’ service, and the removal of the compensatory cap for such claims – are now confirmed to be coming into force from 1 January 2027.

An employee will therefore only need six months’ service to bring an unfair dismissal claim where the “effective date of termination” falls on or after 1 January 2027. This means that an employee who starts employment on 1 July 2026 will immediately gain unfair dismissal protection on 1 January 2027.

Employers should be mindful that the “effective date of termination” is not always the same as the contractual dismissal date – for example, where an employee is dismissed without notice and is instead paid in lieu, their effective date of termination will be when their statutory notice entitlement would have expired. As 1 January approaches, it will be important to take advice on any contemplated dismissals that fall in the weeks before that date to ensure that you are clear on any employee’s entitlements.

There is a lot for employers to think about ahead of these changes coming into force. We have explored some of the key preparatory steps in our ERA hub page focussed on these reforms, which you can access below. If we can support your organisation in preparing for these reforms, please contact Luke Bowery or your usual employment team contact.

Zero/low hours and shift workers

On the topic of the ERA, last week the government launched a consultation into new rights for eligible workers on zero and ‘low’ hours contracts to be offered a contract reflecting the hours that they regularly work (referred to as a “guaranteed hours contract”), together with new rights to reasonable notice of shifts and compensation for short-notice changes to, or cancellation of, shifts. Whilst these new rights are detailed within the ERA, the underlying detail (which will determine who is eligible and what steps employers need to take) will be set out in regulations.

The mammoth 83-page consultation document looks at much of that underlying detail, including:

• Which workers will be covered by the right to be offered a guaranteed hours contract when they meet the other qualifying criteria for such an offer. Those on zero hours contracts are automatically covered but the ERA also sets out that workers on contracts guaranteeing below a set number of hours per week will also be protected by this new right. In the consultation, the government explains that its preference for this hours threshold is in the range of 8 to 20 hours per week.
• What the reference period(s) for assessing the hours worked by eligible workers should be. The initial reference period is expected to be 12 weeks. The government is consulting on various options for the length of the subsequent reference period – a rolling 12-week reference period, a longer subsequent reference period (e.g. 26 or 52 weeks) or a gap between the initial and subsequent reference periods, with the employer not required to record the worker’s hours during such gaps.
• Who the limited exceptions to the right to a guaranteed hours contract should apply to, with a particular focus on workers engaged on a fixed term contract linked to a limiting event (like a conference worker engaged until the conference ends). The scope of these exceptions will be of particular interest to employers who rely on seasonal workers to respond to surges in demand (for example, retail or hospitality workers engaged to cover the busy lead up to Christmas).

Whilst the consultation covers a lot of ground, there remains uncertainty as to how these reforms will operate in practice. It is worth bearing in mind that the reforms will impact not just on those employers who directly engage zero/low hours workers and shift workers – it will also affect organisations who engage agencies who provide eligible workers as the ERA includes similar protections for agency workers. Importantly these include some obligations not just on the agency, but on the hirer or end user client as well.

The consultation will close on 25 August 2026. For more detail on the points covered in the consultation, don’t forget to check out our updated ERA hub page on zero/low hours and shift worker reforms (linked below).

Carers’ leave review

In April 2024, a new right for carers was introduced entitling them to up to one week’s unpaid leave per year to arrange or provide care for dependants who have long-term care needs. Later that year, in its Next Steps to Make Work Pay paper the new Labour government outlined its plans to review the implementation of unpaid carer’s leave and examine the benefits of introducing paid carer’s leave. The government has now launched consultation into this topic.

In the consultation, which closes on 1 September 2026, the government is seeking views on a range of options, including:

• increasing the length of statutory unpaid carer’s leave, to allow carers to take more time away from work to arrange or provide care for dependants who have long-term care needs;
• introducing a “right to return” for carers who take a longer period of unpaid carer’s leave. This would operate in a similar way to the rights of maternity and other family-leave returners; and
• introducing paid carer’s leave.

The same consultation also includes several questions looking at potential extension of the employment support that is available for parents of seriously ill children, including the potential introduction of a new paid leave entitlement.