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Posted: Mon 13th Jul 2026
Last updated: Mon 13th Jul 2026
5 min read
For many small businesses, employment law only becomes urgent when something has already gone wrong.
There are plenty of examples, like an employee submitting a grievance, someone else challenging their sick pay, or a manager handling a difficult conversation badly.
That approach is becoming more dangerous.
The Employment Rights Act 2025 is already changing parts of UK employment law, with further changes being introduced in phases across 2026 and 2027.
GOV.UK has confirmed that the implementation timetable is staged, with measures taking effect at different points, including April 2026, August 2026, October 2026, January 2027 and later in 2027.
This isn't a reason for you to panic, but it is a clear reason to prepare.
Some changes are already in force.
Paternity and parental leave: From 6 April 2026, paternity leave and ordinary unpaid parental leave became a day-one right.
This means eligible employees no longer need the previous length of service before accessing those rights.
Statutory Sick Pay (SSP): This has also changed. From 6 April 2026, SSP is payable from the first day of sickness absence instead of the fourth day, and the lower earnings limit has been removed.
That means more lower-paid, part-time and variable-hours workers may now qualify.
Collective redundancy situations: There are other important changes too. From 6 April 2026, the maximum protective award for failure to consult properly in collective redundancy situations increased from 90 days' pay to 180 days' pay.
Sexual harassment disclosures: These also became qualifying disclosures under whistleblowing law.
In large organisations, an internal HR, legal and payroll team can absorb these changes. For a small business, the issue is often very different.
Knowing the law has changed is one step, but the better considerations are:
Are your contracts up to date?
Are your policies accurate?
Does your payroll team understand the changes to SSP?
Do managers know what to do when someone requests paternity leave or parental leave?
Do you have proper records?
Do you know when to get advice?
If you don't give these things the proper attention, the risk to your business increases.
Most small business owners aren't trying to get things wrong.
In my experience, the problem is usually that people are busy, operational demands come first and employment documents are only reviewed when something forces the issue.
But employment law doesn't sit separately from day-to-day business. In fact, some of the core elements of employment law are:
sickness absence
recruitment
family leave
how managers speak to employees
dismissals, grievances, redundancies and workplace conflict
Employment law should be the governing rule whenever you deal with an employee or any third party, as a small mistake at the start of a process can become much more expensive later.
For example, if a manager gives incorrect advice about sick pay or fails to record an absence properly, the problem may not be immediately obvious.
It may only appear later when there is a grievance, a resignation, a dispute or a tribunal claim.
That's why your small business needs to treat employment law as part of a risk management process, and not just as paperwork.
Further employment law changes are expected later in 2026 and 2027.
GOV.UK states that measures coming into force in October 2026 include:
trade union changes, stronger trade union access rights and new protections for trade union representatives (read my blog on this very issue)
harassment measures, including requiring employers to take "all reasonable steps" to prevent sexual harassment and introducing an obligation on employers not to permit third-party harassment
GOV.UK also lists employment tribunal time limits as taking effect no earlier than October 2026.
From January 2027, the unfair dismissal qualifying period is due to fall to six months for dismissals from 1 January 2027, alongside uncapping compensatory awards.
That gives you time to prepare, but that time will only be helpful if you use it.
There are five areas I'd prioritise.
Review your employment contracts. They should reflect the reality of the working relationship and what the law currently requires.
Review your staff handbook and key policies. Sickness absence, family leave, grievance, disciplinary, harassment, whistleblowing and redundancy processes should be clear and usable.
Check managers' guidance. A policy is only useful if managers understand what it means in practice.
Improve your record-keeping. Notes, dates, correspondence, absence records and decisions matter. If a dispute arises, evidence becomes important.
Take advice early. The best time to seek support is usually before the conversation, not after it's gone wrong.
The Employment Rights Act 2025 is more than an update to the law. You should see it as a reminder that people management needs structure.
For small businesses, the aim is to steer clear of all those avoidable mistakes. That means:
clear documents
clear processes
clear manager guidance
taking early action
That's what protects the business, supports employees and reduces the risk of issues becoming formal, expensive and damaging.
