Changes to Employment Law – An update for businesses

Here we list employment law changes that have come into force, those that are due to come into force and bills that have been re-introduced into Parliament.

Forthcoming legislative changes – Overview

Forthcoming legislative changes, including the implementation of new laws and the dates when new statutory rates come into effect are listed. The entries under ‘forthcoming legislation’ are marked as ‘to be confirmed’. This is because even when a new law is made, the date on which it will come into force cannot be announced until relevant secondary regulations are in place that add details into a new law.

January 2025

Employers with a January–December annual leave year will finally be able to introduce rolled-up holiday pay for their part-year and/or irregular hours workers, should they want to.
From 20 January, the 25% uplift for failing to comply with the statutory Code of Practice on Dismissal and Re-engagement will include protective awards for the first time. This applies in situations where an employer proposes to change employee terms via dismissal and re-engagement which affects 20 or more employees, which triggers the need to collectively consult. Failing to do this can result in a protective award for all affected workers of up to 90 days’ pay. Where the employer has also failed to comply with the code, that award could be uplifted by up to 25% by the employment tribunal.

April 2025

New statutory rates will come into force, including:
• National Living Wage for over 21’s increases to £12.21
• National Minimum Wage for 18–20-year-olds increases to £10
• National Minimum Wage for 16–17-year- olds and Apprentice Rate increases to £7.55
• Statutory Sick Pay increase to £118.75 per week
• Statutory Maternity Pay and other family related leave pay increases to £187.18 per week
• Lower Earnings Limit increases to £125 per week.

Neonatal care leave and pay is also expected to come into force in April, although regulations needed to do this still have to be put before Parliament. This will give employees a new right to time off work when a baby they have responsibility for is in hospital receiving neonatal care.

May 2025

Whilst not a legal change, employers signed up to pay the Real Living Wage must increase pay to £12.60 in UK and £13.85 in London by 1 May if they wish to retain their accreditation from the Living Wage Foundation.

Other reforms expected in 2025

A new right to paternity (bereavement) leave is expected to come into force, although regulations are still needed to do this. These are expected to be in place for this new right to come into effect from April 2025. This will give fathers or non-birthing partners access to paternity leave in cases where a mother, or a person with whom a child is placed or expected to be placed for adoption, dies. The leave is likely to operate in a way similar to maternity leave, and last for up to 52 weeks.

The Children’s Wellbeing and Schools Bill, if it passes into law, will bring in several changes to how children are employed, including amendments to the rules on their working hours and the need for all employers to have a permit to employ them.

Further plans for reforming the law

We expect to see further developments relating to the Employment Rights Bill, although changes under this Bill are not expected to come into force until 2026.

Employment law dates at a glance – forthcoming changes

The dates for the following are yet to be confirmed:

Under the Neonatal Care (Leave and Pay) Act 2023, parents of babies who are admitted to hospital before they are 28 days old, and for at least one week, will get a maximum of 12 weeks’ leave, paid at the statutory rate, in addition to maternity/paternity leave.

In the King’s Speech on 17 July 2024, the Government committed to introducing a draft Equality (Race and Disability) Bill. This is intended to bring into law Labour’s manifesto commitment to “enshrine the full right to equal pay in law” for ethnic minorities and disabled people.

The Bill is expected to include the following:
• introduce into law the full right to equal pay for ethnic minorities and disabled people and give them the right to bring an equal pay claim
• mandatory ethnicity and disability pay reporting for employers with 250 or more employees.

The Government has also committed to put before Parliament a Skills England Bill. This will establish a new body, Skills England, which will bring together businesses and trade unions in a new partnership with employers at its heart and reform the apprenticeship levy.

After receiving Royal Assent on 24 May 2024, the Paternity Leave (Bereavement) Bill became the Paternity Leave (Bereavement) Act 2024.
Once in force, this will give the right to bereaved parents to take a form of paternity leave where they would not otherwise be eligible due to their length of service.
No implementation date is available for this yet.

Bills re-introduced into Parliament

The Bullying and Respect at Work Bill, previously introduced to Parliament but not enacted before Parliament was dissolved ahead of the July 2024 election, has been re-introduced to parliament. If this comes into law, it will:

• provide a statutory definition of bullying at work
• create a new claim relating to workplace bullying that can be brought before an employment tribunal
• provide for a Respect at Work Code to set minimum standards for positive and respectful work environments
• give powers to the Equalities and Human Rights Commission to investigate workplaces and organisations where there is evidence of a culture of, or multiple incidents of, bullying and to take enforcement action

The Non-Disclosure Agreements Bill has been put before Parliament. If enacted, it will make provision about the content and use of non-disclosure agreements.

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