Employment Rights Bill Roadmap for payroll

In July 2025, the government set out a detailed roadmap for implementing the Employment Rights Bill, which aims to strengthen protections for workers and deliver on the ‘Plan to Make Work Pay.’

While many measures focus on employment rights and HR processes, several will directly affect payroll operations. Below are the key measures and when they’re expected to take effect, helping you plan and prepare.

Measures coming into effect (at royal assent or soon after)

• Repeal of the Strikes (Minimum Service Levels) Act 2023.
• Repeal of most provisions of the Trade Union Act 2016.
• Simplification of industrial action notices.
• Protections against dismissal for taking industrial action.

April 2026 measures

• Removal of the Lower Earnings Limit and waiting period, giving up to 1.3 million low-paid workers access to Statutory Sick Pay (SSP) for the first time. Payroll teams will need to update SSP eligibility checks and systems.
• Paternity Leave and Unpaid Parental Leave entitlements will become available from an employee’s first day of work, requiring adjustments to leave tracking and statutory pay calculations.
• Doubling the maximum period for protective awards in collective redundancy situations.
• Establishment of the Fair Work Agency, which may issue guidance affecting payroll and employment practices.
• Simplifying trade union recognition processes, plus new provisions for electronic and workplace balloting.
• Strengthened whistleblowing protections.

October 2026 measures

• Introduction of regulations to curb misuse of ‘Fire and Rehire’, which could affect payroll adjustments during restructures.
• ‘Tightening the tipping law’, Requiring fair distribution of tips through payroll in affected sectors (e.g. hospitality).
• Duty to inform workers of their right to join a trade union.
• Strengthened union rights of access, and new protections for trade union reps.
• Requiring employers to take ‘all reasonable steps’ to prevent sexual harassment and harassment by third parties.
• Shortening employment tribunal time limits.
• Extending protections against detriments for employees taking industrial action.
• Procurement reforms relevant to some employers, including a two-tier code.

Measures expected in 2027

• Further reforms to flexible working rights beyond what has already been implemented, including clearer guidance for employers.
• Ban on exploitative zero hours contracts, with measures extended to agency workers. This will impact contracted hours and regular pay calculations in affected sectors.
• Rights for pregnant workers and enhanced protections.
• Gender pay gap and menopause action plans. These will start on a voluntary basis in April 2026, but formal implementation is expected in 2027.
• Regulations around umbrella companies, collective redundancy thresholds, and industrial relations framework updates.
• A new right for employees to be protected from unfair dismissal from their first day, affecting HR and payroll practices related to probation and terminations.

Key considerations for payroll

• Many of these changes, particularly around SSP, leave entitlements, and predictable working patterns, will require updates to payroll systems and processes.
• Payroll teams should work closely with HR to ensure employees understand how changes affect their pay and rights.
• The roadmap outlines phased consultations running through 2025-2026, meaning final details could shift. Staying informed will help you prepare for updates.
• The majority of regulations will come into effect on the common commencement dates of 6 April or 1 October, but some measures (e.g., the Mandatory Seafarers Charter) have specific timelines such as December 2026.

The Employment Rights Bill introduces the biggest upgrade to workers’ rights in a generation. Payroll professionals should track consultations, update systems in advance of commencement dates, and coordinate closely with HR teams to ensure full compliance and smooth implementation.