The Employment Rights Act 2025

The Employment Rights Act 2025 is the first phase of the Government's Make Work Pay agenda. It received Royal Assent on 18 December 2025 and introduces the most significant reforms to employment law in a generation, with important implications for voluntary, community, faith and social enterprise (VCFSE) organisations across health and social care.

The Act will be implemented in phases throughout 2026 and 2027, with many provisions requiring secondary legislation before they come into force.

What does the Act include?

Day one employment rights

The Act strengthens workers' rights from the first day of employment, including protection from unfair dismissal, access to parental leave and Statutory Sick Pay (SSP), subject to implementation regulations. This removes qualifying periods that have often left new, part-time and lower-paid workers with fewer protections.

Zero-hours and low-hours contracts

The Act does not ban zero-hours contracts. Instead, it introduces three new rights for qualifying workers, expected to come into force in 2027:

• the right to be offered guaranteed hours based on the hours regularly worked during a reference period;
• the right to reasonable notice of shifts and changes to shifts; and
• the right to payment where shifts are cancelled, curtailed or moved at short notice.

The Government is currently consulting on the regulations that will determine how these rights operate in practice, including the proposed 12-week reference period for guaranteed hours.

Fire and rehire

The Act strengthens protections against "fire and rehire" practices by limiting employers' ability to dismiss staff and re-engage them on less favourable terms. Employers will be expected to follow strengthened consultation requirements before making contractual changes.

Flexible working and family rights

Flexible working is strengthened, with employers required to consider requests fairly and justify refusals. The Act also enhances protections for pregnant employees and new parents, including redundancy protections and improvements to family-related leave.

Statutory Sick Pay

The Act expands access to Statutory Sick Pay by removing the lower earnings limit, extending eligibility to many lower-paid and part-time workers who were previously excluded.

Fair Work Agency

A new Fair Work Agency will bring together employment rights enforcement, helping to improve compliance, tackle exploitation and support workers in accessing their rights.

Fair Pay Agreement for adult social care

The Act establishes the legal framework for introducing a Fair Pay Agreement in adult social care, bringing together employers, workers and Government to negotiate sector-wide pay and employment conditions.

What happens next?

Implementation of the Employment Rights Act is being phased over 2026 and 2027.

The Government is currently consulting on the detailed regulations needed to implement the new rights relating to zero-hours and low-hours contracts, including guaranteed hours, reasonable notice of shifts and compensation for cancelled shifts. You can respond to this consultation by 25 August 2026.

The Association will continue to keep members updated as further regulations, guidance and commencement dates are announced.