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Introduction
The Employment Rights Bill’s progression through Parliament signals more than incremental legislative change it represents a fundamental recalibration of the employment relationship.
For HR leaders and business owners, the question isn’t simply one of compliance. The reforms demand a more nuanced consideration: how will the removal of the traditional two-year protective buffer affect your recruitment decisions, probationary frameworks and performance management infrastructure? What operational implications arise from guaranteeing hours to zero-hours workers, and how might strengthened collective consultation rights reshape your employee relations landscape?
Our latest blog discusses what is coming up throughout 2026.
KEY TAKEAWAY:
From April 1st 2026: Sick pay starts day one (not day four). Fair Work Agency launches with enforcement powers. Costs rise 15-25% for most SMEs. You have 8 weeks to prepare your policies, budgets, and management teams.
If you’re a business owner in Horsham, Brighton, Guildford, or across the Southeast feeling overwhelmed by the Employment Rights Act 2025, you’re not alone. This legislation, now law as of December 18th 2025, represents the biggest shake-up to UK employment law in a generation.
Here’s what makes this particularly challenging for businesses in Sussex, Surrey and London: you’re already navigating the competitive job’s market, above-average wage pressures and higher costs of living. Now add sweeping regulatory changes that hit your payroll, policies, and management practices all at once.
The April 2026 deadline is now only a matter of weeks away. Let’s break down exactly what changes, why it matters to you and the practical steps you need to take now.
The government designed the Employment Rights Act 2025 to strengthen worker protections in response to insecure work practices, gig economy concerns, and post-pandemic employment challenges. For employers, this means immediate compliance obligations across four critical areas:
Day one sick pay becomes the new reality from April 1st. Previously, employees waited until day four and needed to earn above the Lower Earnings Limit (£123 per week). Both restrictions disappear. SSP rises to £123.25 weekly, and every employee qualifies from their first day of sickness.
For a business with 15 employees and typical absence rates, expect an additional £3,000-£5,000 annually in sick pay costs. For larger teams, this quickly escalates.
Think of this as HMRC’s employment law counterpart. The Fair Work Agency launches in April with powers to inspect workplaces, investigate complaints, and issue penalties for minimum wage violations, unlawful deductions, and other employment standards breaches. Sectors with historically high non-compliance such hospitality, retail, care-work should expect increased scrutiny.
Paternity leave (2 weeks) and unpaid parental leave (18 weeks) become immediate rights. New starters can claim these from day one, there is now no qualifying period. Sexual harassment now has explicit whistleblowing protection and union access rules have relaxed significantly.
National Living Wage rises 4.1% to £12.71 (ages 21+), with the 18-20 rate jumping to £10.85. Maternity, paternity, and adoption pay increases to £194.32 weekly. These aren’t Employment Rights Act changes technically, but they compound your April cost pressures.
Change | Before April 2026 | After April 2026 |
SSP Waiting Days | Day 4 | Day 1 |
SSP Earnings Limit | £123/week minimum | Removed |
Paternity Leave | After 26 weeks service | Day 1 right |
What about 2027? Additional ERA provisions roll out next year, including unfair dismissal protection from day one, restrictions on fire-and-rehire practices, and zero-hours contract reforms. April 2026 is just the beginning.
Last week, a prospective client in Brighton asked us: “Do I really need to pay sick pay from day one?” The answer is yes. But paying it correctly while maintaining control of absence levels requires a strategic approach.
Here’s the roadmap we will use with our clients across Sussex, Surrey and London:
Step 1: Budget Planning (Do This Now)
Calculate your specific exposure. Take your current workforce, average absence rate (UK average: 5.8 days annually per employee according to CIPD), and multiply by the new day-one SSP obligation. Add wage increases. For a 20-person team, you’re looking at £15,000-£25,000 in additional annual costs depending on your absence patterns and pay structures.
Step 2: Policy Reviews (February Deadline)
Your sick leave policy, family leave policy, and whistleblowing procedures need immediate updates. Out-of-date policies don’t just risk Fair Work Agency penalties-they create confusion when managers make real-time decisions. One client recently faced an employment tribunal partly because their maternity policy referenced 2018 regulations.
Step 3: Management Training (March Deadline)
Your managers are your front line. They need practical training on processing day-one sick pay, documenting absences correctly (essential for pattern monitoring), conducting return-to-work conversations, and navigating the expanded whistleblowing landscape. Policy updates mean nothing if your team doesn’t know how to apply them.
Step 4: Absence Management Systems (April Go-Live)
Implement robust tracking before April 1st. You need clear reporting procedures (who calls whom by when?), centralized absence records, and structured return-to-work protocols. This isn’t about being harsh, it’s about being fair, consistent, and cost-conscious. ACAS guidance emphasises that well-managed absence policies reduce claims while supporting genuine employee wellbeing.
Generic online guides can only take you so far. Here’s what makes current employment challenges unique:
For Sussex’s thriving hospitality and tourism sector, seasonal workers and irregular hours complicate sick pay calculations. London professional services firms face different pressures such as highly mobile talent, competitive benefits expectations, and sophisticated employee knowledge of their rights. Surrey’s manufacturing and retail businesses sit somewhere between, often operating on tighter margins with less HR infrastructure.
Local HR consultants like us at MJV Consulting understand regional employment tribunal outcomes, sector-specific challenges, and the practical realities of Southeast labour markets.
MJV Consulting are a Horsham-based HR Consultancy who have been helping local businesses since 2016 through regulatory changes where we provide context-specific advice, not cookie-cutter compliance.
When does the Employment Rights Act 2025 come into force?
The Act became law on December 18, 2025. Most provisions take effect April 1, 2026, with additional changes rolling out throughout 2027.
Does day-one sick pay apply to part-time and casual workers?
Yes. All employees qualify from their first day, regardless of hours worked or earnings level. The previous Lower Earnings Limit no longer applies.
What are the penalties for non-compliance with the Fair Work Agency?
Penalties vary by violation type but can include significant fines, naming and shaming, and in serious cases, director disqualification. The Agency has investigative powers similar to HMRC for tax matters.
Do these changes apply if I only employ contractors or gig workers?
Employment status determines rights. If your contractors meet the legal definition of “workers” or “employees,” they qualify for relevant protections. The Fair Work Agency will scrutinize misclassification heavily, this is a high-risk area.
I have fewer than 10 employees. Do these rules still apply to me?
Yes. The Employment Rights Act 2025 applies to businesses of all sizes. Micro-businesses face the same sick pay, minimum wage, and family leave obligations as larger employers.
About MJV Consulting
MJV Consulting provides specialist HR support to Surveyors, Architects and Property Management companies in Horsham, Crawley, Haywards Heath, Burgess Hill and Guildford. We offer retained HR services, compliance audits, policy development, and HR systems implementation, helping businesses manage their people effectively without the cost of full-time HR staff. Contact us at www.mjvconsulting.co.uk or 01403 916727 to discuss how we can support your business growth.
If you’d like to discuss your HR challenges or explore how we can support your business, contact us at MJV Consulting on 01403 916727 or email us at info@mjvconsulting.co.uk. We’re here to help small businesses across Sussex, Surrey and London build teams that thrive.
