UK Trends and Developments Contributed by: Diane Gilhooley and Paul Fontes, Eversheds Sutherland
ber of businesses would be expected to meet the nar - row financial justification. In addition, the doubling of the maximum redundancy consultation penalty may also apply to such situa - tions, which is part of the government’s plan to make it potentially unaffordable to “buy out” employees when contemplating fire and rehire or fire and replace. Practical implications The new automatic dismissal protections will signifi - cantly limit an organisation’s ability to enforce contrac - tual change (in the absence of agreement), notably to certain pay, hours and holiday provisions. As a result, greater consideration of the wording of contracts, the offer of employee incentives, consultation processes and negotiation strategies is expected. Doubling the maximum award for a failure to col - lectively consult on redundancies will also introduce significant new risks, and businesses should review their redundancy processes. The new threshold for triggering the duty to consult will require proactive assessment of all redundancies across the employer. Trade unions The government has committed to “resetting” the industrial relations framework, including reducing restrictions on trade unions, strengthening their pro - tections and supporting strong collective bargaining rights. In pursuit of this reset, the ERB introduces some significant trade union-related changes, due to take effect in phases during 2025 and 2026, including: • a right for unions to request, negotiate and enforce workplace access (including digital access) for their officials to meet, support, represent, recruit, communicate with or organise workers; • a requirement that businesses inform all employees of their right to join a union; • changes to the statutory recognition process (the process by which trade unions seek collective bar - gaining rights with an employer), making it easier for unions to gain recognition; • deregulation of industrial action law by reducing the requirements a union must currently meet when organising lawful strikes, such as lowering the level of support needed in a ballot;
• new protections for trade union members, includ - ing for those taking part in industrial action; and • new rights and protections for union workplace representatives when carrying out union duties. Practical implications A trend towards higher levels of union recognition and collective bargaining is anticipated, together with a potential increase in industrial action. Companies with existing trade union relationships should review the state of industrial relations and engagement and assess how they can best prepare. The new right for unions to access workplaces is a significant change, particularly for workplaces not currently unionised. Other significant ERB changes The ERB will also introduce other significant changes during 2026 and 2027, which will also influence the employment landscape. • Zero- and low-hours contracts – a right for eligible workers on zero- and low-hours contracts (to be defined) to be offered a guaranteed hours con - tract that reflects the hours regularly worked over a reference period, rights to reasonable notice of shifts and shift changes and compensation for certain shift changes, and extending these rights to agency workers. • Statutory sick pay (SSP) – SSP rights are extended by removing the lower earnings limit and three-day waiting period. • Diversity – see Equality Reforms below. • Flexible working – an employer’s refusal to an application for flexible working on one of the eight existing statutory grounds must be reasonable. • Family leave – paternity and unpaid parental leave will become day-one rights, as qualifying service periods are removed; the dismissal of women who are pregnant, on maternity leave, and during a six-month return-to-work period will be restricted, except in “specific circumstances” (to be defined), and bereavement leave rights extended. • Enforcement – major changes are being made to the enforcement of workplace employment rights. The ERB provides for a new public body, the Fair Work Agency, to exercise existing enforcement functions on behalf of the government and also extends its powers. For example, for the first time,
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