The first tranche of legislative change of the Employment Rights Act 2025 came in April 2026. In our previous article, we explored those developments. October 2026 marks the second wave of reforms, introducing changes that represent a significant shift in the employment landscape and warrant careful consideration by employers. Key changes include:
Sexual Harassment
From 30 October 2026, the Act will strengthen the existing duty on employers to prevent sexual harassment. More specifically, the duty to take “reasonable steps” will become a duty to take “all reasonable steps”.
Regulations specifying what might amount to reasonable steps are not expected until 2027/28 at the earliest. Meantime, employers will need to assess their own risks and determine what additional steps are reasonable for their particular workplace.
This change will require not only updated policies, training and reporting processes; but also proactive identification of risks and evidence that appropriate preventive action has been taken.
Third Party Harassment
From 30 October 2026, the Act also introduces a new duty on employers to take all reasonable steps to prevent third party harassment. It covers not only sexual harassment but harassment related to all protected characteristics, and both in-person and online interactions.
The sectors most acutely affected will likely be those where staff regularly interact with the public, including retail, leisure and hospitality.
As with the strengthening duty relating to sexual harassment, employers should prepare for this by not only updating their policies and training, but by building and evidencing a structured approach to prevention. This will include reviewing risk assessments, harassment policies, equal opportunities policies and grievance procedures; updating staff training and establishing clear reporting lines; reviewing third-party contracts; and considering publishing notices in public-facing environments and/or in email footers.
Tribunal Time Limits
The time limit for raising most Tribunal proceedings increased from 3 to 6 months from 1 October 2026. ACAS Early Conciliation (which is mandatory for most claims) ‘pauses the clock’ for up to 12 weeks. In practice, employees may therefore have around 9 months from dismissal to bring a claim.
We anticipate this change will result in more claims, many of which may be better prepared.. The longer period gives prospective claimants longer to take advice, gather documents, and exhaust internal procedures. Fewer employees will miss the previously very narrow window.
Looking ahead for 2027
Employers should also be aware of the following upcoming changes:
Unfair dismissal
The unfair dismissal reforms will take effect from January 2027.The qualifying period for ordinary unfair dismissal will reduce from two years to six months, and the cap on the compensatory awards will be removed . These changes will significantly increase the number of employees with unfair dismissal protection. As a result, we expect the volume and value of claims to increase, recruitment and probation to be more robust, and managed exit negotiations to be more protracted.
Trade Unions
The union right of access to workplaces came into effect from 30 October 2026, as planned. This gives unions a right to request physical and digital access to workplaces and to communicate with workers, even where they are not recognised. Employers should take note of this change, as there are substantial financial penalties for non-compliance. The new duty to inform workers of their right to join a trade union has been deferred to January 2027.
Tipping
Presently, tips must be passed on to workers in full and be distributed “fairly”. Employers must have a written tips policy, and keep a record of all qualifying tips received and allocated for three years.
The Act introduces additional requirements for employers:
- To consult with trade union or elected representatives or (if none) workers directly, before producing the first version of their written tips policy.
- To repeat this consultation every time the policy is reviewed, with reviews needing to be carried out at least every three years from when the policy was first implemented.
- To make available to all workers an anonymised summary of feedback received in consultation.
These changes were expected to come into force in October 2026, but implementation has now been postponed, and is expected later in 2026.
Zero hours
The consultation on potentially significant changes to the way employers engage staff on zero and low hours contracts closed at the end of August 2026. We await the government’s position in relation to the reforms. Presently, they are not expected to take effect until at least 2027.
What should employers be doing now?
As further reforms continue to be introduced, employers should review their existing policies and procedures, ensure managers are aware of the upcoming changes, and consider whether any additional training or workplace measures may be required.
If you have any questions regarding the Employment Rights Act 2025 or wish to discuss any other employment matter, please get in touch with a member of our team.
