UK Employment Law Changes 2026: What HR Managers Need to Know

Quick Answer: Key UK Employment Law Changes in 2026

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1. National Minimum Wage Increases (April 2026)

The National Living Wage and National Minimum Wage rates increase on 1 April 2026:

What this means for HR:

• Review all payroll to ensure no employee falls below the new minimum
• Update offer letters and contracts that specify hourly rates
• Check part-time and zero-hours workers who may be close to the threshold
• Audit commission-only and piece-rate arrangements to confirm NMW compliance

Key risk: Non-compliance with NMW can result in HMRC enforcement, public naming, and back-pay liability. HMRC actively investigates complaints and conducts targeted audits.

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2. Employment Rights Bill: What Changes and When

The Employment Rights Bill 2024 introduces the most significant changes to UK employment law since the Employment Act 2002. Royal Assent is expected in 2025, with most provisions coming into force in 2026.

Day-One Unfair Dismissal Protection

Current position: Employees need 2 years of continuous service before qualifying for unfair dismissal protection.

What changes: The qualifying period is abolished. All employees will have the right not to be unfairly dismissed from day one of employment.

What this means for HR:

• Probationary periods remain lawful, but you must follow a fair process even during probation
• Dismissals during probation must be for genuine performance or conduct reasons, with reasonable investigation
• Introduce structured probation review processes: regular check-ins, documented feedback, clear objectives
• Update your disciplinary policy to reflect that fair process applies from day one

Flexible Working as the Default

Current position: Flexible working must be requested by the employee after 26 weeks of service.

What changes: Flexible working becomes the default position from day one. Employers must have genuine business reasons to require a set pattern of attendance.

What this means for HR:

• Review job adverts: all roles should include whether flexible working is available and in what form
• Update your flexible working policy to reflect the new default approach
• Train managers on how to consider and decline flexible working requests lawfully
• Document business reasons for any rigid attendance requirements

Strengthened Trade Union Rights

• Right to strike: reduced notice period and simplified balloting rules
• Union recognition: lower threshold for statutory recognition claims
• Right to information: unions get greater access to workforce data

What this means for HR: If you have a unionised workforce or are in a sector with active union presence, review your collective bargaining arrangements and recognition agreements.

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3. Statutory Sick Pay (SSP) Changes

From 6 April 2026, the SSP rate increases to £118.75 per week (from £116.75).

No waiting days from day one: The Employment Rights Bill also introduces SSP from the first day of illness rather than the fourth. This is a significant change:

What this means for HR:

• Budget for higher SSP costs, particularly for businesses with high short-term absence
• Review occupational sick pay policies that interact with SSP
• Update Bradford Factor thresholds if you have trigger points based on short-term absences
• Communicate the change to employees who may not have claimed SSP for 1-3 day absences under the old rules

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4. Employer National Insurance Changes

From 6 April 2026:

• Employer NIC rate increases from 13.8% to 15%
• Secondary threshold drops from £9,100 to £5,000 per year

This is the largest employer NIC cost increase in a generation.

Impact example (25 employees at £30,000):

Employment Allowance: Businesses eligible for Employment Allowance can offset up to £10,500 of their NIC bill (increased from £5,000). Check eligibility — most businesses with an employer NIC bill under £100,000 qualify.

What this means for HR:

• Inform your payroll provider of the changes before April
• Work with finance to model the cost impact for 2026/27 headcount plans
• Check Employment Allowance eligibility — claim via your payroll software or HMRC
• Review any contractor arrangements where IR35 may be relevant (NIC costs make employee status more expensive)

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5. Worker Protection Act: Ongoing Employer Duty

The Worker Protection (Amendment of Equality Act 2010) Act 2023 has been in force since October 2024. It introduced an active duty on employers to prevent sexual harassment in the workplace.

This is not a new change in 2026, but EHRC enforcement is ramping up and many employers are still not compliant.

The duty requires employers to:

• Take reasonable steps to prevent sexual harassment before it occurs
• Train all staff on what constitutes sexual harassment
• Have a clear anti-harassment policy that covers harassment by third parties (customers, clients)
• Create reporting mechanisms that employees trust and use
• Investigate and act on all reported incidents promptly

Risk: The Equality and Human Rights Commission can take enforcement action. Employment tribunals can uplift compensation by up to 25% if an employer failed to comply with the preventative duty.

Checklist for compliance:

• Update anti-harassment policy to include third-party harassment
• Train all staff (and document completion dates)
• Provide manager-specific training on handling reports
• Set up a confidential reporting process
• Schedule regular policy reviews

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6. Right to Neonatal Care Leave

The Neonatal Care (Leave and Pay) Act gives parents of babies requiring hospital care after birth the right to up to 12 weeks of additional paid leave.

• Applies from the baby's first 28 days of life
• Child must spend at least 7 days in hospital
• Leave is in addition to maternity, paternity, and shared parental leave
• Statutory Neonatal Care Pay (SNCP) at flat rate (aligned with other statutory pay rates)

What HR must do:

• Update your parental leave policy to include neonatal care leave
• Train HR and managers to recognise and process neonatal leave requests sensitively
• Update payroll processes to handle SNCP

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What HR Managers Should Do Now

Immediate actions (April 2026 deadline)

1. Audit payroll for NMW compliance against new rates (effective 1 April 2026)
2. Confirm SSP rate is updated in payroll software before 6 April 2026
3. Model NIC cost impact and claim Employment Allowance if eligible

Before Employment Rights Bill commencement

4. Rewrite disciplinary and performance procedures to work from day one
5. Review all job adverts to include flexible working availability
6. Introduce structured probation reviews with documented check-ins
7. Update flexible working policy to reflect new default position

Ongoing

8. Anti-harassment training if not yet completed — document all sessions
9. Update parental leave policy to include neonatal care leave

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How Grove HR Helps with 2026 Compliance

Grove HR is built for UK employment law and is updated as legislation changes:

• Bradford Factor tracking: Automatically flag absence patterns — particularly important as SSP from day one may change short-term absence behaviour
• Leave management: Built-in support for all statutory leave types including neonatal care leave
• Document management: Store updated policies and track employee acknowledgements
• Training records: Log anti-harassment training completion with dates and certificates

Get started with Grove HR or book a demo to see how we handle UK compliance.