The Employment Rights Act 2025 introduces significant changes to the employment law landscape.
For boards and senior leadership teams, the challenge is not to understand every detail of the legislation, but to identify the risks, costs, deadlines and decisions that matter to their business.
In short
-
Boards do not need to know all the law. They need risk, cost, dates and decisions.
-
The Employment Rights Act changes the risk profile of almost every business.
-
A one-page briefing works better than a long report.
Key Messages for the Board
There are several important developments that directors and senior leaders should have on their radar.
1. Some Changes Are Already Law
Some changes are already in force. Boards should ask for an audit of the organisation's current position, rather than relying on an opinion about whether the business is ready.
Board question: Have we audited the changes already in force, and can we demonstrate compliance?
2. Harassment Is a Preventative Duty
Employers must take proactive steps to prevent sexual harassment in the workplace. The legislation strengthens that duty and introduces additional provisions relating to harassment by third parties, including customers and clients.
Boards should understand the measures in place to identify risks, prevent incidents and respond effectively when concerns are raised.
Board question: Are our harassment prevention measures practical, documented and understood by managers?
3. The Trade Union Landscape Is Changing
The legislation introduces significant changes to trade union rights and workplace access.
These changes may affect businesses even where there is currently no recognised trade union or existing union membership.
Employers should understand the statutory process for union access requests and the circumstances in which access may be required. It is not simply a matter of the CEO saying no.
Board question: Do we understand the new trade union access framework, and are our managers prepared to respond appropriately?
4. Dismissal Risk Is Changing
Changes to unfair dismissal rights will affect how employers manage recruitment, probation, performance and dismissal decisions.
The reforms include a reduction in the qualifying period for ordinary unfair dismissal protection to six months and the removal of the statutory compensatory award cap, subject to the relevant commencement provisions.
Boards should consider the financial and operational implications, including manager training, documentation and budgets for potential exits.
Board question: Are our recruitment, probation, performance management and dismissal processes ready for the new requirements?
5. The State Can Enforce Employment Rights
The Fair Work Agency introduces a new approach to the enforcement of employment rights.
Businesses should not assume that enforcement risk only arises when an individual employee brings a claim. The new enforcement framework gives the state a more direct role in investigating and enforcing certain employment obligations.
Board question: Can we produce the records and evidence needed to demonstrate compliance if our employment practices are scrutinised?
6. There Is Still More to Come
The Employment Rights Act is being implemented in stages, and boards should prepare for further reforms, including:
-
Fire and rehire reforms
-
Bereavement leave
-
Changes to collective redundancy thresholds
-
Restrictions relating to non-disclosure agreements
-
Enhanced dismissal protections for pregnant women and new mothers
-
Flexible working reforms
The key is to maintain a clear implementation timetable, identify who is responsible for each change and review progress regularly.
A Board Briefing That Works
Boards need clear, concise information that enables them to make informed decisions. A one-page briefing can be more useful than a lengthy legal report.
For each significant change, the briefing should answer five questions:
-
What is changing?
Explain the change in one sentence.
-
When?
Identify the relevant commencement date or implementation deadline.
-
What could it cost?
Consider financial exposure, compliance costs and management time.
-
Where are we now?
Use a simple red, amber or green assessment to show readiness.
-
What decision do we need today?
Identify the action, approval or investment required from the board.
Beyond the Law
Legal compliance is only one part of the picture. Boards should also consider whether their organisations are operationally and culturally prepared for the changes.
That means looking at manager capability, workplace culture, employee voice and reputation, alongside the financial implications of employment decisions.
Budgets for employee exits may need to be reviewed. Managers may need additional training. Existing systems should be assessed to ensure they can produce accurate records when required.
The wider board responsibility: Do we have the leadership, management capability, systems and culture needed to manage these changes effectively?
The Human Side
The best defence under the new law is a workplace where people feel safe, heard and fairly treated.
That is a leadership and management issue, not just a legal one.
Good employment practices start with good leadership. Boards need to understand the law, but they also need to create workplaces where people are listened to, respected and treated fairly.
Let's Talk
At Impact Lawyers, we brief boards and leadership teams in plain English, helping them understand the Employment Rights Act changes and what they mean for their organisation.
Our briefings focus on practical risks, costs, implementation dates and the decisions your business needs to make, supported by a clear action plan.
Book a board briefing with Victoria.
Email: victoria.hall@impactlawyers.co.uk
By Victoria Hall, Co-Founder Employment Law
Victoria is an experienced employment lawyer, a Level 7 CIPD-qualified HR professional, accredited external workplace investigator, practising coach and a non-executive director.
This article is for informational purposes only and does not constitute legal advice. For specific legal advice tailored to your business, please contact the Impact Lawyers team at contact@impactlawyers.co.uk .