As we step into 2025, significant changes in UK employment law are on the horizon, largely driven by the Employment Rights Bill. As usual there will be national minimum wage increases from 1 April 2025 and an increase to family related leave payments, statutory sick pay and Tribunal compensation awards, and we will update you on these once the regulations setting out the increased amounts are published in March this year.  

Here we have summarised a few key developments that you should be aware of in the coming year. We will keep you updated on these changes, as the year progresses:

Artificial Intelligence (AI) in the Workplace

This is an area of rapid growth, and the Government have promised to publish a consultation and “… will seek to establish the appropriate legislation to place requirements on those working to develop the most powerful artificial intelligence models”.  With the growing prevalence of AI in the workplace, there is an increasing need to evaluate and address the associated risks. In March and November 2024, the government and the ICO issued new guidance specifically focused on the use of AI in HR and recruitment. Further guidance and best practice recommendations are expected in 2025. 

Flexible working

Flexible working continues to evolve under the Employment Rights Bill. While employees already have a day-one right to request flexible working, new measures will require employers to:

• Provide specific reasons for refusing a request.
• Demonstrate that the refusal is reasonable.

Sexual harassment

Building on the Worker Protection Act 2023 and the new duty to prevent sexual harassment, the Employment Rights Bill introduces a heightened duty for employers to take “all reasonable steps” to prevent sexual harassment, both by colleagues and third parties. This expanded duty will also cover harassment related to other protected characteristics.

Additionally, reporting sexual harassment will now explicitly qualify as whistleblowing, providing stronger protection for employees who come forward.

Collective Redundancies

When the changes outlined in the Employment Rights Bill come into effect, it will mean the employers will need to take into account the proposed redundancies across the whole business and not just at an individual site or establishment. This change will likely capture more redundancy scenarios under the collective consultation rules, ensuring wider employee protection and requiring businesses to carefully plan their workforce restructuring.

Fire & Rehire

The controversial practice of “fire and rehire” remains a focal point of reform.   Under the Employment Rights Bill, dismissals to enforce contractual changes will be automatically unfair unless there are financial difficulties which threaten the employer’s ability to carry on business as a going concern, so there is no alternative but to fire and rehire.

Family Related Leave

Paternity Leave is to become a day-one right and employers will be prohibited from dismissing employees who were pregnant within six-months of their return to work except in narrowly defined circumstances (to be set out in further regulations).

The Employment Rights Bill is expected to come into force in autumn 2026.  As you can see, the employment law landscape will bring significant changes that will impact both employers and employees. Additional consultations with stakeholders are anticipated in 2025, to address matters to be incorporated into the supporting regulations for the new legislation. If you’re unsure about what these changes mean for you, don’t worry – we’re here to help guide you through and make sure you, and your workplace, are ready for what’s to come.

Contact us

For employment law advice, contact our Employment Partner, Lindsey Abbott.