Employment Law Update August 2026: Employment Rights Act 2025 Reforms, ACAS Changes and Key Employer Obligations

The pace of employment law reform continues to accelerate. In this month’s employment law update, we examine key developments under the Employment Rights Act 2025, including changes to trade union ballot procedures, Employment Tribunal time limits and workplace harassment protections. We also explore important developments affecting UK employers, including lessons from the Chloe Moffat inquest, ongoing challenges facing working parents, proposed changes to the ACAS Code of Practice on Disciplinary and Grievance Procedures, and the Government’s new £60 million employment support fund. With significant changes continuing throughout 2026 and beyond, employers should take the opportunity to review their policies, procedures and workplace practices to ensure they remain compliant and prepared for future reforms. Employment Rights Act 2025 Update: Key Changes Employers Need to Prepare For The Employment Rights Act 2025 has already introduced significant changes to workplace rights and employer obligations, with further reforms scheduled throughout 2026 and 2027. Employers should ensure their policies, procedures and workplace practices remain under regular review. Now in Force: Employment Rights Act Reforms Introduced in April 2026 Several important changes to UK employment law came into force on 6 April 2026, introducing new rights for workers and additional obligations for employers. Key reforms include: Statutory Sick Pay (SSP): SSP is now payable from the first day of sickness absence, with the removal of both the waiting period and the Lower Earnings Limit. Family-Friendly Rights: Employees now benefit from day-one rights to paternity leave and unpaid parental leave. Collective Redundancies: The maximum protective award for failing to comply with collective consultation obligations has doubled, significantly increasing the potential cost of non-compliance. Whistleblowing: Sexual harassment disclosures now qualify for protection under whistleblowing legislation. Trade Union Recognition: The statutory trade union recognition process has been simplified. In addition, on 7 April 2026 the Fair Work Agency was established, bringing together employment rights enforcement functions under a single regulator with enhanced investigative and enforcement powers. The new agency is expected to play a key role in enforcing workplace rights and ensuring employer compliance with the Employment Rights Act 2025. ​August 2026: New Trade Union Ballot Reforms ​ From August 2026, significant changes to statutory trade union ballots came into force, introducing greater flexibility in how union members can vote. Trade unions can now conduct ballots using: Electronic voting; Hybrid voting, allowing members to vote electronically or by post; and Workplace voting for industrial action ballots, where voting takes place at or near the workplace with the employer’s consent. The reforms are intended to modernise the balloting process, increase participation and improve accessibility for union members, while maintaining safeguards designed to ensure ballots remain secure and reliable. Although the changes do not impose any immediate obligations on employers, they form part of the Government’s wider programme of trade union reform. Employers, particularly those operating in unionised environments, should remain alert to further developments affecting industrial relations, collective bargaining and trade union access rights. October 2026: Major Changes to Employment Tribunal Claims and Workplace Harassment Protections ​ Further significant employment law reforms are scheduled to take effect from October 2026, increasing both employer obligations and potential legal risk. From 1 October 2026, the time limit for bringing most Employment Tribunal claims will increase from three months to six months. This will provide claimants with a longer period in which to pursue workplace claims and may increase the volume of litigation faced by employers. Organisations should therefore review their document retention practices and ensure employment records are maintained for an appropriate period. From 30 October 2026, employers will be subject to enhanced duties to prevent workplace harassment. Key changes include: A requirement to take “all reasonable steps” to prevent sexual harassment in the workplace; and Potential liability for harassment committed by third parties, including customers, clients and contractors, where reasonable preventative measures have not been taken. The same date will also bring further trade union reforms, including: A new duty to inform workers of their right to join a trade union; Enhanced statutory trade union access rights; and Stronger protections for trade union representatives. Taken together, these changes represent a significant shift in employer responsibilities. Businesses should begin reviewing harassment policies, staff training programmes and workplace reporting procedures now to ensure they are prepared for the new legal requirements. ​Looking Ahead: Key Reforms Expected in 2027 The Employment Rights Act 2025 reforms are expected to continue throughout 2027, introducing further changes to unfair dismissal rights, family protections and working arrangements. Employers should begin planning ahead for the following developments: Unfair Dismissal Protection: From 1 January 2027, employees will qualify for ordinary unfair dismissal protection after six months’ continuous service, replacing the current two-year qualifying period. This is likely to increase the number of employees able to bring unfair dismissal claims. Unfair Dismissal Compensation: The statutory cap on compensatory awards for unfair dismissal is expected to be removed, significantly increasing potential financial exposure for employers. Fire and Rehire: New restrictions on so-called “fire and rehire” practices will make dismissals used to impose less favourable contractual terms automatically unfair in many circumstances. Pregnancy and Maternity Protections: Additional protections are expected for pregnant employees and those returning from maternity leave, strengthening existing family-friendly rights. Zero-Hours and Shift Work Protections: Workers are expected to gain new rights relating to guaranteed hours, reasonable notice of shifts and compensation where shifts are cancelled, moved or curtailed at short notice. These proposed reforms continue the Government’s focus on strengthening workplace protections and increasing employer accountability. Businesses should monitor developments closely and review contracts, policies and workforce practices well in advance of implementation. How Employers Can Prepare for Upcoming Employment Law Changes ​The Employment Rights Act 2025 and related workplace reforms represent a significant shift towards stronger worker protections, increased regulatory oversight and greater employer accountability. Employers should take proactive steps now to ensure they are prepared for both current and upcoming changes. Key areas to review include: Employment contracts, policies and staff handbooks to ensure they reflect recent and forthcoming legislative changes; Harassment policies, reporting procedures and training programmes in light of the enhanced duty to prevent workplace harassment; Document retention and record-keeping practices ahead of the extension of Employment Tribunal time limits; Payroll systems and internal processes to ensure compliance with changes to Statutory Sick Pay and other statutory entitlements; and Management training to help managers understand and apply their responsibilities under the new employment law framework. Taking proactive steps now will help businesses manage risk, maintain compliance and prepare for future employment law developments. Employers that act early are likely to be better placed to adapt to changes as they come into force and reduce the likelihood of workplace disputes. If your business requires advice on preparing for the Employment Rights Act 2025 reforms or reviewing workplace policies and procedures, please contact our specialist employment solicitors. Employment Law News – August 2026  Alongside the ongoing Employment Rights Act 2025 reforms, several other developments have attracted attention across the employment law landscape. In this section, we examine lessons arising from the Chloe Moffat inquest, the continuing challenges faced by working mothers, proposed changes to the ACAS Code of Practice on Disciplinary and Grievance Procedures, and the Government’s new £60 million employment support fund. HM Treasury Disciplinary Process Under Scrutiny ​ The recent inquest into the death of HM Treasury employee Chloe Moffat has prompted renewed discussion about how employers conduct disciplinary processes and support employee wellbeing. The case highlights the importance of balancing procedural fairness with sensitivity, particularly where allegations may cause significant distress. Ms Moffat, a Treasury employee with an exemplary record and a pending promotion, was unexpectedly called to a meeting regarding an anonymous complaint. She was provided with limited information about the allegations, was not informed that a senior manager would be present and was unable to be accompanied by a companion of her choice. Following the meeting, she reportedly believed her employment was at risk despite dismissal being unlikely. During the inquest, concerns were raised about the level of support provided and whether Ms Moffat had been given sufficient opportunity to prepare for the meeting and access appropriate support. HM Treasury has since committed to reviewing its disciplinary procedures and providing further training for managers. The case has also prompted wider discussion around employee wellbeing during disciplinary proceedings, including calls for greater consideration of mental health and clearer communication of employee rights. The ACAS Code of Practice on Disciplinary and Grievance Procedures sets out minimum standards for workplace investigations and disciplinary processes, including providing employees with sufficient information about allegations, reasonable time to prepare and the right to be accompanied where applicable. However, the Moffat inquest serves as a reminder that procedural compliance alone may not always be sufficient. How concerns are communicated and how individuals are supported throughout the process can have a significant impact on employee wellbeing. Key Considerations for Employers Employers may wish to review whether their disciplinary procedures: Provide employees with adequate notice of meetings and sufficient information about the issues being discussed; Clearly explain the purpose of meetings, the process being followed and any potential outcomes; Signpost appropriate wellbeing support, such as employee assistance programmes or occupational health services; and Ensure managers are trained to recognise and respond appropriately where an employee appears distressed or vulnerable. As disciplinary and grievance procedures continue to attract scrutiny, employers should ensure that both procedural fairness and employee wellbeing remain central to their approach. The Motherhood Penalty Persists: Challenges Facing Working Mothers Working mothers in the UK continue to face significant barriers in the workplace, according to the 2026 State of the Nation survey published in July 2026. The findings suggest that pregnancy and maternity discrimination, childcare costs and limited workplace flexibility remain key factors affecting women’s career progression and participation in the workforce. The report found that the impact of the so-called “motherhood penalty” extends well beyond maternity leave. Nearly three-quarters of mothers reported experiencing pregnancy or maternity discrimination, with more than one-third leaving their employer as a result. The findings highlight the ongoing challenges many women face in balancing work and caring responsibilities. Key findings included: Almost one in five single mothers do not return to work following maternity leave, with financial pressures and childcare costs identified as major contributing factors. 82% of mothers who ended maternity leave early did so because they could no longer afford to remain away from work, highlighting concerns around the adequacy of Statutory Maternity Pay. More than one in ten flexible working requests from parents were refused, with many mothers reducing their hours or leaving work altogether because of childcare costs. Many women reported feeling unable to discuss fertility treatment or abortion-related issues at work due to concerns about potential career consequences. Nearly one in four pregnant employees did not receive a workplace risk assessment, highlighting continuing compliance concerns for employers. What This Means for Employers The findings serve as a reminder that legal compliance alone may not be enough to attract, retain and support working parents. Employers should consider whether their policies, management training and workplace culture adequately support employees during pregnancy, maternity leave and their return to work. Key areas for review may include: Flexible working arrangements and family-friendly policies; Pregnancy and maternity risk assessment procedures; Manager training on pregnancy, maternity and sex discrimination issues; and Support mechanisms for employees balancing work and caring responsibilities. As workplace expectations and employment law continue to evolve, organisations that proactively support working parents are likely to be better placed to retain talent, improve employee engagement and reduce the risk of discrimination claims. New ACAS Draft Code Signals Significant Changes for Employers ACAS has launched a public consultation on a revised Code of Practice on Disciplinary and Grievance Procedures, marking the first substantial update to the Code since 2009. The draft Code reflects modern workplace practices and places greater emphasis on fair, transparent and consistent workplace procedures. The consultation remains open until 23 September 2026. The proposed changes indicate a shift towards earlier intervention, greater consideration of employee wellbeing and a stronger focus on resolving workplace issues before formal action becomes necessary. Key proposed changes include: Encouraging reasonable investigations, clear communication and greater consideration of employee wellbeing; Providing further guidance on reasonable adjustments and the training of managers involved in disciplinary and grievance processes; Reinforcing that suspension should only be used where necessary and proportionate; Recognising mediation and facilitated conversations as valuable tools for resolving workplace disputes; Considering the role of AI in disciplinary and grievance procedures; and Adopting less adversarial language throughout the Code. A central theme of the draft Code is the encouragement of informal resolution wherever appropriate. Employers are expected to consider whether concerns can be resolved informally before commencing formal disciplinary or grievance procedures. Where formal action is taken, organisations should be able to explain what informal measures were considered or why an informal approach was not suitable in the circumstances. Employers should also be aware that unreasonable non-compliance with the ACAS Code may continue to have significant consequences. Employment Tribunals can increase or reduce compensation by up to 25% where a party has unreasonably failed to comply with the Code. How Employers Should Prepare Although the revised Code is still subject to consultation, employers may wish to begin reviewing: Disciplinary and grievance policies and procedures; Manager training on workplace investigations and informal resolution techniques; Template correspondence and procedural documentation; Current approaches to suspension and employee wellbeing; and Whether workplace concerns are being addressed informally where appropriate before escalating to formal processes. The consultation highlights a growing expectation that employers adopt a balanced approach to workplace disputes, combining procedural fairness with early intervention, effective communication and proportionate decision-making. Government Launches £60 Million Employment Support Fund The Government has announced a new £60 million Pathways to Work Innovation Fund, which aims to support projects that help disabled people and individuals with long-term health conditions access, remain in and progress within employment. The fund is expected to open for applications in September 2026 and forms part of the Government’s broader strategy to reduce economic inactivity and improve workforce participation. The initiative reflects an increasing focus on workplace inclusion, accessibility and supporting individuals with health-related barriers to employment. While the fund is primarily aimed at organisations delivering employment support programmes, it signals the Government’s continued commitment to improving labour market participation and creating more inclusive workplaces. What This Means for Employers Employers should continue reviewing their approach to workplace accessibility, reasonable adjustments and employee wellbeing. Organisations that invest in inclusive employment practices are likely to be better placed to attract and retain talent, improve employee engagement and adapt to future employment policy developments. Closing Remarks The developments highlighted in this month’s employment law update reflect the continuing evolution of UK employment law, with increasing emphasis on workplace protections, regulatory enforcement and employer accountability. With significant reforms already in force and further changes scheduled throughout 2026 and 2027, employers should ensure they remain proactive in reviewing workplace practices and legal compliance. Employers should take this opportunity to: Review employment contracts, policies and procedures to ensure they reflect recent and upcoming legislative changes; Prepare for further trade union reforms, including changes to ballot processes and access rights; Ensure disciplinary and grievance procedures remain fair, transparent and properly documented; and Provide managers with appropriate training on emerging employment law obligations and workplace risks. Taking proactive steps now will help businesses manage risk, maintain compliance and adapt confidently to the changing employment law landscape. Thank you for reading our August 2026 Employment Law Update. If your organisation requires advice on any of the issues discussed in this update, or support reviewing workplace policies and procedures, our specialist employment solicitors would be pleased to assist.