No HR Team? Here's What the Employment Rights Act Means for You
The Employee Rights Bill 2025 is a minefield for everyone but particularly for those who don’t have HR support. If you’re an operator consuming articles aimed at large scale businesses and finding the whole thing overwhelming, this one’s for you. Below are the five areas most likely to catch businesses like yours off guard, not because you've been careless, but because the processes you've built made sense until now.
1. Statutory Sick Pay – the 3 day buffer is gone - In force April 2026
The change
SSP is payable from day one of any absence. Every worker qualifies and there’s no earnings threshold. No exceptions for smaller employers.
Your likely process today
Absence is handled informally via WhatsApp message, a phone call. The three-day unpaid period quietly deterred short absences. There’s very little absence data or tracking. Payroll aren’t updated causing inaccuracies in pay.
What has to change
Payroll updated immediately. A written absence policy and return-to-work process trained and recorded consistently. Systems that provide the ability to track the trends and cost impact on the business. These are now your best tools for managing short-term absence.
2. Collective Redundancy – the penalty doubled, and the threshold is lower than you think. In force April 2026
The change
The penalty for failing to collectively consult has doubled to 180 days' pay per employee. Triggered at 20 redundancies in 90 days. No exemption for smaller businesses.
Your likely process today
Redundancy means a conversation and a payment. Most founders at this scale have never heard of collective consultation or that a restructure of 20+ roles triggers a 45-day legal process.
What has to change
Before any restructure, know your headcount threshold. If you're near 20, take advice first. The cost of getting this wrong just doubled.
3. Unfair Dismissal – you no longer have 2 years to figure someone out. January 2027 but affects hires from July
The change
Unfair dismissal protection drops from two years to six months. The compensation cap is removed meaning awards will be based on actual loss meaning bigger financial risk.
Your likely process today
Probation reviews happen informally, a quick chat, nothing in writing. Underperformance goes unchecked until the review. Managers miss the probation end date and backdate an extension or failure.
What has to change
Probation needs a hard end date, a documented review, and written objectives from week one. Managers should stay close to performance throughout probation. Stipulating what happens if no review is held by the probation end date in contracts.
4. Sexual Harassment – your clients and customers are now your responsibility - Strengthened October 2026
The change
The duty to prevent harassment strengthens to "all reasonable steps." Employer liability for third-party harassment by clients, contractors, customers is reinstated. NDAs covering harassment are void.
Your likely process today
A policy in a handbook nobody reads. Client-facing staff who tolerate poor behaviour because "that's just what they're like." Possibly a settlement agreement with a confidentiality clause.
What has to change
A risk assessment for third-party exposure. A clear reporting route for staff. Managers briefed that the client relationship doesn't provide cover.
5. Flexible Working – ‘we’re pretty flexible here’ is not a policy - In force now tightening 2027
The change
Day one right to request flexible working is already live. From 2027, refusals require a written reason from a defined list. Inconsistent decisions across your team create discrimination exposure now.
Your likely process today
Lack of awareness that this is now a day 1 right. Requests are handled differently by different managers, based on gut feel. No written decisions, no log. One team gets flexibility; another doesn't and there's no defensible reason why.
What has to change
A written policy, a consistent process, and a decision log. If you can't articulate a business reason for a refusal, or you're applying different rules to different teams, you're already exposed.
Running a business without a HR team doesn't make you underprepared, it means you’re probably feeling stretched, which leads to cutting corners. You’re not alone! This doesn’t make you a bad operator, you’re simply prioritising the hundred other things that also needed doing.
The bad news is, this legislation increases the risk attached to some of those gaps caused by corner cutting. The good news is that most of them are fixable quickly, once you know where they are, and we can help you identify them. So if you’re looking for some direction or support in any of the areas mentioned above, contact us to arrange a call or coffee!
Thanks for reading my first blog! I’ll be sharing new articles every Friday covering topics across employee experience and people strategy.