Why this matters.
The Employment Rights Act 2025 represents the biggest overhaul of UK employment law in a generation, introducing day-one protection from unfair dismissal, stronger rights to flexible working, restrictions on “fire and rehire” practices, and new rules on zero-hours and low-hours contracts. Many provisions are being phased in through 2026 and 2027, but employers are expected to start preparing contracts, policies and HR processes now.
Businesses that don’t update their contracts, handbooks and dismissal procedures risk employment tribunal claims — which can now be brought from an employee’s first day rather than after two years’ service. Tribunal awards for unfair dismissal are uncapped in some cases, and reputational damage from a high-profile claim can be significant for a small business. Reviewing your contracts, probation processes and policies now is far cheaper than defending a claim later.