This month’s edition covers a landmark Supreme Court ruling on the definition of “sex” under the Equality Act, new interim guidance on workplace facilities, legislative progress on the Employment Rights Bill, and regulatory changes impacting immigration compliance. We also highlight two government consultations that could signal significant shifts in equality and pay reporting obligations.
Employment Law Update | Landmark Ruling, New Guidance & Compliance Changes
This month’s edition covers a landmark Supreme Court ruling on the definition of “sex” under the Equality Act, new interim guidance on workplace facilities, legislative progress on the Employment Rights Bill, and regulatory changes impacting immigration compliance. We also highlight two government consultations that could signal significant shifts in equality and pay reporting obligations.
Case of the Month – Definition of ‘Sex’ under the Equality Act
The Supreme Court has ruled that the term “sex” in the Equality Act 2010 refers to biological sex, not gender identity—even where a Gender Recognition Certificate (GRC) has been issued. The decision – in For Women Scotland Ltd v Scottish Ministers – has significant implications for the application of single-sex exceptions under the Act, including in the workplace.
While the Court reaffirmed that transgender individuals continue to benefit from protection under the gender reassignment provisions of the Act, it confirmed that where lawful single-sex exceptions are engaged (such as changing facilities or roles requiring sex-specific criteria), these must be assessed by reference to biological sex alone.
EHRC Guidance on Single-Sex Workplace Facilities
In response to the Supreme Court’s ruling, the Equality and Human Rights Commission (EHRC) has provided interim guidance for employers. Key points include:
- Where single-sex spaces are provided (e.g. toilets, changing rooms), access should generally be based on biological sex.
- Trans employees must not be left without suitable facilities; unisex or single-user spaces should be offered where possible.
- Facilities that are fully self-contained and lockable can lawfully be used by any individual.
- While the guidance is non-statutory, it may be considered by courts and tribunals. A public consultation on further guidance is expected later this month.
What Can Employers Do to Ensure Compliance?
With such developments reshaping the interpretation of “sex” under the Equality Act, tribunal rulings affecting compensation and discrimination law, and new guidance on workplace facilities, employers should act now to review and align their practices. Key steps include:
Reviewing Equality & Inclusion Policies:
- Revisit existing equality, diversity, and inclusion (EDI) policies to ensure they reflect the Supreme Court’s clarified definition of “sex”.
- Consider how single-sex spaces are designated and ensure they comply with EHRC interim guidance.
- Auditing Workplace Facilities:
- Assess access to toilets, changing rooms, and similar spaces.
- Where necessary, introduce private or mixed-use alternatives to avoid exclusion and mitigate risk.
Employment Rights Bill – Legislative Update
The Employment Rights Bill continues its progress through Parliament and has currently progressed to the House of Lords for further scrutiny. Recent amendments focus on enhancing protections for zero-hours and low-paid workers. The Bill aims to create a more predictable framework for atypical workers, with further provisions on redundancy protections and minimum notice periods under discussion.
If passed as expected, the Bill could receive Royal Assent before Parliament’s summer recess in July, allowing some parts of the Bill to take effect as early as October 2025, including:
- Employer liability for third-party harassment
- Increase in the limitation period from three months to six months for several tribunal claims
Right to Work Checks – Extended to Gig Workers and Zero-Hour Contracts
The government has proposed plans to extend the obligation to conduct right to work checks to include gig economy workers and those on zero-hours contracts, including workers engaged through third-party or subcontractor arrangements. This would significantly expand compliance obligations beyond traditional employment relationships.
Key Changes:
- Penalties for non-compliance will rise to £60,000 per illegal worker (previously £45,000) for repeat breaches
- Director disqualification and potential criminal sanctions could also apply for serious breaches
A consultation is expected in due course. Employers should begin reviewing onboarding procedures and third-party labour contracts in anticipation of this change.
Ongoing Government Consultations
1. Mandatory Ethnicity and Disability Pay Gap Reporting The government is consulting on proposals to introduce mandatory ethnicity and disability pay gap reporting for employers with 250 or more employees, similar to existing gender pay gap obligations. The consultation remains open until 10 June 2025.
2. Equality Law – Call for Evidence A broader call for evidence is seeking input on reforms to equality law, including views on a range of issues:
- Dual discrimination
- Equal pay transparency
- Discrimination and sexual harassment remedies
The call for evidence remains open until 30 June 2025.
📌 Closing Remarks
The evolving legal landscape highlights the importance of proactive compliance and inclusive workplace practices. With tribunal decisions, statutory updates, and policy changes shaping employer obligations, now is the time to review internal processes and engage in strategic preparation.
At Kalra Legal Group, we are committed to supporting you through these changes with practical guidance and expert advice. If you require assistance with reviewing, understanding, or implementing these developments, please don’t hesitate to get in touch.
For further guidance, contact our dedicated Employment Law team at Kalra Legal Group.
