The first major wave of the Employment Rights Act 2025 (ERA 2025) comes into force on 6 April 2026, marking the most significant shift in UK employment law in over a decade. These changes will dramatically affect HR teams, payroll processes, recruitment agencies, umbrella companies and any organisation engaging workers, whether directly or through supply chains.
Below is a clear guide to what’s changing and how employers should prepare.
1. Day One Rights to Paternity & Parental Leave
From 6 April 2026, new employees will no longer need lengthy qualifying periods to access family friendly rights. Both Paternity Leave and Unpaid Parental Leave become day one rights, allowing employees to take leave almost immediately after joining if they meet the other qualifying criteria.
This change requires employers to:
- Update contracts and handbooks
- Inform hiring managers that very early leave requests may now be valid
- Review induction processes
2. Statutory Sick Pay (SSP) Becomes a Day One Entitlement
The SSP system undergoes a major restructuring, including:
- Removal of the three day waiting period
- Removal of the lower earnings limit
- Extending day one SSP entitlement to all employees
Every worker, regardless of hours or income, will qualify from their first day of sickness. Businesses should expect:
- More short term sickness claims
- Increased administration and payroll adjustments
- The need for tighter absence management controls
3. Strengthened Whistleblowing Protections (Including Sexual Harassment)
Disclosures relating to sexual harassment will now explicitly qualify for whistleblowing protection, widening the scope for safe reporting and employer liabilities if concerns are mishandled.
Now is the time to:
- Re-train managers on handling sensitive disclosures
- Review whistleblowing policies
- Reinforce anti harassment framework
4. Collective Redundancy: Protective Award Doubles
The cap on protective awards in collective redundancy situations increases from 90 days’ pay to 180 days. This significantly raises the cost of non compliance for employers who fail to consult appropriately.
5. Expansion of Flexible Working Rights
Employees will gain expanded access to flexible working, including broader eligibility and procedural strengthening. These rights form part of the April 2026 reform group.
Employers should ensure internal processes and response timelines are fully compliant.
6. The Rise of the Fair Work Agency (FWA)
April 2026 sees the first step toward the FWA - a new enforcement body designed to improve compliance standards, investigate breaches and issue penalties where necessary.
Although the FWA will evolve through 2026–2027, businesses should prepare early.
7. NEW: Joint & Several Liability (JSL) from April 2026 - A Critical Compliance Shift
Alongside ERA 2025 changes, the UK government is introducing sweeping Joint & Several Liability (JSL) rules from 6 April 2026, aimed at cracking down on tax non compliance within umbrella companies and labour supply chains.
Under JSL, HMRC can recover unpaid PAYE and National Insurance from ANY party in the supply chain - the umbrella company, the agency or the end client. This applies even if your organisation already paid the funds to the agency or umbrella provider.
Action Steps to Reduce JSL Exposure:
- Audit all umbrella and agency partners
- Request evidence of PAYE/NIC remittances
- Update contracts to require compliance confirmation
- Reject any provider promising “enhanced take home pay” or unusual tax models
What Employers Should Do Now: A Quick April 2026 Compliance Checklist
Policy & Contract Updates
• SSP, paternity, parental leave, flexible working
• Whistleblowing and anti harassment
• Redundancy and consultation obligations
Supply Chain & Payroll Risk Management
• Conduct JSL ready audits
• Strengthen due diligence documentation
• Ensure PAYE/NIC processes are verifiable
Manager & HR Training
• Early stage leave requests
• Handling protected disclosures
• New flexible working rights
• Understanding JSL liability exposure
Conclusion
The changes coming into force on 6 April 2026 represent a structural reset in employment law and payroll compliance. While the ERA 2025 reforms modernise workers’ rights and strengthen protections, the introduction of Joint & Several Liability creates substantial new obligations for any organisation involved in labour supply chains.
Employers who prepare early - reviewing policies, updating contracts, auditing their supply chains and educating managers - will not only stay compliant but also avoid costly risks as HMRC’s enforcement powers expand.
You can find out more about Joint and Several Liability, how it affects your use of agency suppliers and what we are doing to protect our clients by clicking here.