Since our last publication on Labour’s Employment Rights Bill (“the Bill”) in March 2025, the Independent Schools team has been following the Bill’s path to becoming law, which has been anything but straightforward.
The Bill is currently in its final “ping pong” stage of parliamentary approval, moving between the House of Commons and House of Lords as they attempt to resolve their differences on specific amendments.
We discuss below the Bill’s major changes and key areas still up for debate.
The Roadmap
Progress was made on 1 July 2025 when the Government published its roadmap for delivery of the Bill.
Publication of the roadmap marked the first time that the Government had provided detailed timescales and potential implementation dates. With Royal Assent anticipated in late 2025, most provisions then take effect in staggered six-monthly intervals throughout 2026 and 2027.
It is hoped that this phased approach will provide schools with a little breathing space to prepare for the new changes. That being said, the coming months offer a valuable opportunity to build readiness into School policy, contracts and culture.
Some key dates for the diary include:
| Implementation date | Measure |
| April 2026 | – Reforms to Statutory Sick Pay, including removal of the lower earnings limit – “Day 1” Paternity Leave and Unpaid Parental Leave – Simplification of the trade union recognition process – Fair Work Agency established |
| October 2026 | – “Fire and rehire” becomes automatically unfair – Extension of the tribunal claim limitation period from 3 months to 6 months – Trade union members’ right of access extended – Duty on employers to take “all” reasonable steps to prevent workplace sexual harassment, including sexual harassment by third parties |
| (Possibly) 2026 | Protection from Unfair Dismissal after a period of employment of six months |
| 2027 | – 1 week of unpaid bereavement leave from “Day 1” – Right of zero, low-hours and agency workers to receive guaranteed hours – Gender pay gap and menopause reporting requirements – Refusal of flexible working request must be “reasonable” – Introduction of a comprehensive industrial relations framework |
See the full document – Implementing the Employments Rights Bill – Our roadmap for delivering change
Unfair dismissal qualifying period
A Lords amendment to the Bill, first proposed in July 2025 and reaffirmed in November 2025, rejected the Government’s “Day 1” right to claim unfair dismissal. The Lords offered up in the alternative a reduction to the qualifying period from two years to six months.
The Commons, in turn, rebuffed the Lords’ changes, choosing instead to reinstate the “Day 1” eligibility with the employer buffer of a statutory probationary period. Until just last week, the plan remained that employers would be required to follow a “light-touch” dismissal procedure during that initial period of employment, anticipated to last 9 months.
However, in an unexpected U-turn, the Government has abandoned one of its flagship manifesto pledges. Ending months of parliamentary toing-and-froing, the Government has conceded to the Lords and has decided to replace the “Day 1” right with a six-month qualifying period. The announcement follows Government-chaired discussions with business representatives and trade unions.
In place of “Day 1” protection from unfair dismissal, the reduction of the statutory qualifying period to claim unfair dismissal from two years to six months will still have a considerable impact on employers and how they manage recruitment and probationary periods. Schools should prepare themselves by introducing or updating a fair and compliant probation policy which documents objectives and sets clear expectations for employer and employee from the outset. It is likely that Schools will wish to reduce probationary periods to one term or less for non-teaching staff.
Bereavement leave
Under current employment law, there is no general statutory right to bereavement leave, unless an employee’s child dies under the age of 18, or is stillborn after 24 weeks of pregnancy.
The Bill, however, proposes a statutory bereavement entitlement of at least one week unpaid leave. In new amendments to the Bill, the right has been extended to pregnancy loss before 24 weeks. It is unclear yet whether partners or close relatives of those who have experienced pregnancy loss will also benefit.
In addition to the support that schools should already be offering to employees experiencing this type of loss, schools will need to put in place robust cover plans in the event that immediate coverage is required for a bereaved staff member. Schools that currently lack enhanced pay policies may also see their budgets affected.
Non-disclosure agreements (“NDAs”)
A significant recent amendment to the Bill, if passed, will make void any NDA clauses that prevent current and former workers from disclosing or alleging workplace harassment or discrimination, or an employer’s response to such incidents.
The change aims to prevent victims and witnesses from being silenced by confidentiality clauses in employment contracts and settlement agreements.
It is no secret that a workplace that prioritises accountability and transparency, and creates a safe environment where concerns are addressed effectively, is more likely to attract and retain good employees. However, the proposal may render employers less willing to enter into settlement agreements, potentially creating the risk of more employment claims and adverse publicity.
Schools should ensure that their internal reporting processes and document templates are updated in light of the upcoming changes.
What happens next and how can Moore Barlow help?
Although the Bill is expected to receive Royal Assent before the end of 2025, it is possible that it could “ping pong” between the two Houses for some time yet.
It was announced last week that 26 separate consultations will be launched after the Bill becomes law, to hammer out the specifics of various provisions. The outcomes of those consultations will then be addressed in secondary legislation. Although the Government’s appeal for employers to have their say on the practical implications of the legal changes is welcome, the problem with relying on a multitude of consultations to flesh out many of the Bill’s provisions is that further uncertainty and delays are likely.
Nonetheless, schools that take early action to prepare for the upcoming changes in the law will be in a far stronger position to adapt without disruption as those changes are rolled out.
The Independent Schools team would be very happy to guide you through any preparatory steps you may wish to take. Please get in touch with your usual contact if you require support.
Addendum – 9 December 2025
In a seismic change to the Government’s plan for the Employment Rights Bill, it was announced on Friday 5 December that the unfair dismissal regime will include a removal of the statutory cap on the compensatory award.
The basic award will remain unchanged, but it has been reported that once employees have acquired six months’ service and have the right not to be unfairly dismissed, their claim for compensation will be unlimited (as is currently the case in discrimination and whistleblowing claims). Employees will still need to demonstrate that their financial losses flow from the dismissal. The damages uplift of up to 25% for a breach of the ACAS Code also remains unchanged and available.
Under current law, the compensatory award for unfair dismissal is capped at the lower of 52 weeks’ pay or an inflation-linked monetary cap (currently £118,223). The government intends to remove both of these limits altogether.
Employees will still need to provide evidence that their financial loss is attributable to the employer’s actions and they will be under an obligation to mitigate their losses. However, with the ceiling to the compensatory award being lifted, employees will have a much greater incentive to litigate and employers may find it harder to negotiate settlements at levels that they are willing to pay. We may also see complex evidence being presented on valuing losses, particularly where senior and higher-paid roles are concerned.
Against the backdrop of an already overstretched tribunal system, the change will almost certainly lead to lengthier hearings focussed on assessing losses, which in turn will increase tribunal delays.
From a commercial standpoint, we may see that employers are reluctant to dismiss under-performing employees for fear of them bringing a claim for unfair dismissal and we may also see much shorter stretches of employment, with employers dismissing employees before completion of their six-month probationary period. This could foreseeably lead to greater uncertainty and less commercial growth.
In preparation for this major change, schools should put in place robust procedures for recruitment and termination within shortened probationary periods. Schools should also carefully review their capability policies, so that they can deal with unsuitable recruits fairly and swiftly.
