After months of parliamentary debate, the Employment Rights Bill has finally cleared the House of Lords and gained Royal Assent on 18th December 2025. It has now become the Employment Rights Act 2025 (ERA 2025) – a landmark reform that will reshape UK employment law over the coming years.
While many of the changes will not take effect immediately, employers should now be clear on the direction of travel. The focus should shift from what might happen to how and when to prepare.
The two changes employers are watching closely
Two late amendments made during the Bill’s final passage are particularly significant.
First, the qualifying period for ordinary unfair dismissal will reduce from two years to six months, rather than being removed entirely. This change is expected to take effect from January 2027.
Second, and potentially more impactful, the compensation cap for unfair dismissal — currently the lower of one year’s salary or £118,223 — is expected to be abolished, subject to the Government completing and publishing an Impact Assessment. If confirmed, this will substantially increase litigation risk and exposure for employers.
A phased introduction
ERA 2025 will be implemented gradually under a government roadmap.
The only immediate change following Royal Assent has been the repeal of the Strikes (Minimum Service Levels) Act 2023.
Further industrial relations reforms will follow two months later, including simplified industrial action ballots and notices, stronger protection against dismissal during strikes, and the repeal of much of the Trade Union Act 2016.
From April 2026, employers will start to see more practical, day-to-day changes, such as:
Day-one rights to paternity leave and unpaid parental leave
Reformed Statutory Sick Pay (no waiting days or lower earnings limit)
Expanded whistleblowing protection, including sexual harassment complaints
Higher penalties for collective redundancy failures
Additional reforms are planned for October 2026, including tighter controls on fire-and-rehire practices, stronger rules on tips, expanded trade union rights, and a new duty to take “all reasonable steps” to prevent sexual harassment.
Beyond that, 2027 is expected to bring the aforementioned unfair dismissal changes, reforms covering flexible working, bereavement leave, protections for pregnant workers, restrictions on zero-hours arrangements, and regulation of umbrella companies
What should employers be doing now?
For unionised employers, the priority is understanding the imminent changes to industrial action rules and reassessing risk and response planning.
For non-unionised workplaces, preparation should focus on:
Reviewing contracts, variation clauses and probationary provisions
Strengthening probationary processes ahead of the six-month unfair dismissal threshold
Training managers on upcoming rights and obligations
Planning policy updates for family leave, sickness absence and harassment
Auditing payroll and benefits systems in light of SSP reform
The takeaway
ERA 2025 is not a single moment of change but a rolling programme of reform. Employers that start planning early – rather than waiting for implementation dates – will be best placed to manage risk, cost and disruption as the new framework takes shape.
Dave Gledhill joined Bermans as an articled clerk (trainee) in 1984 and has remained with the firm, after qualifying in 1986, for the entirety of his career.
We have a vacancy for an Employment Solicitor at 2-5 years PQE level, based in our Manchester office.
The successful candidate will have experience of running their own caseload, and advising HR Managers and business owners on the full gamut of employment law (particularly senior exits; TUPE transfers; collective redundancies). Employment Tribunal litigation is a key part of this role, as is experience of supporting on corporate transactions.
The role would suit an enthusiastic employment lawyer with a drive for business development and a desire to develop their own practice. We see this role as an excellent opportunity to progress to partnership for the right candidate.
The role will report to Bermans Head of Employment in Liverpool.
Home/remote working is permitted for up to 2 days a week. Salaries are competitive and there is a firm-wide bonus scheme in place for all our fee earners. Our package includes a number of other contractual benefits set out below:
Benefits:
27 days holiday (plus bank holidays)
A referral bonus (if you introduce someone into the business)
Bonus Scheme
Health cash plan – Paycare (eligible after successful completion of probation)
Pension plan (with the option of salary sacrifice)
Cycle to work scheme (eligible after successful completion of probation)
Access to a wellness web app – Leafyard
Travel pass (eligible after successful completion of probation)
We have a new vacancy for a Senior Employment Solicitor, at Partner/Senior Associate level based in our Manchester office.
The successful candidate will lead our Employment offering in Manchester, so will need to demonstrate an ability to attract and retain clients. Other important attributes include a network of business/professional contacts in the Manchester area in particular, and the personality and ambition to develop the Bermans brand further and to play a role in the continued growth of the practice.
For a non-partner there would be excellent opportunities for promotion to partnership.
The successful candidate is likely to have 10 or more years’ PQE and will have experience of both advising the HR teams / boards of corporate clients and litigating Employment Tribunal matters.
The role will report to Bermans Head of Employment, however there will be some managerial responsibilities in respect of junior members of the team.
Home/remote working is permitted for up to 2 days a week. Salaries are competitive and there is a firm-wide bonus scheme in place for all our fee earners. Our package includes a number of other contractual benefits set out below:
Benefits:
27 days holiday (plus bank holidays)
A referral bonus (if you introduce someone into the business)
Bonus Scheme
Health cash plan – Paycare (eligible after successful completion of probation)
Pension plan (with the option of salary sacrifice)
Cycle to work scheme (eligible after successful completion of probation)
Access to a wellness web app – Leafyard
Travel pass (eligible after successful completion of probation)
Ruby works in the Creditor Services team, focusing on debt recovery and litigation proceedings for Invoice Finance Providers, SMEs, and Funders.
Ruby studied Law (LLB) at Durham University, which included a year abroad in Berlin, and went on to achieve a Distinction in her LPC MSc in Law, Business and Management from the University of Law.
Outside of work, Ruby enjoys expanding her legal expertise and enjoys attending concerts, travelling, and learning German in her spare time.
Bermans’ corporate team has extensive experience in advising investors, investee companies and management teams on PE transactions. Such transactions include initial investments, secondary buyouts, co-investments and exits.
The team’s experience in advising the various parties to private equity transactions means that it prides itself in providing commercial advice and being able to achieve its clients’ objectives. We understand the fast-paced nature of private equity and provide commercial, pragmatic advice that aligns with deal timelines and market dynamics.
Our full service offering means that we are able to utilise our specialists in real estate, employment, intellectual property and finance to address the full range of operational issues that may arise in private equity transactions. We also provide ongoing support to portfolio companies, helping them manage risk, scale operations and execute strategic initiatives.
Our experienced corporate team can provide buy-side or sell-side support to shareholders, investors, private limited companies and private equity firms, across a wide variety of sectors. Assisting with end-to-end support throughout a transaction, we can tailor our support to achieve our clients’ end goals.
Our Mergers and Acquisitions services include:
Domestic and cross-border mergers and acquisitions
Our corporate team provides strategic legal support for management teams and business owners navigating the complexities of management buy-outs. If you’re acquiring the company you help run, or you’re a business owner facilitating an internal transition, our experienced team will deliver clear, commercially focused advice on every stage of the transaction.
We understand the unique dynamic of MBOs, including the sensitive balance between maintaining relationships and achieving fair outcomes.
Our corporate team provides comprehensive legal support for corporate disposals, whether you’re divesting a subsidiary, exiting a market or refocusing on core operations. Our experienced corporate team can work alongside you, your internal teams and financial advisors to manage risk, preserve value and ensure compliance throughout the transaction.
Our expertise includes:
Legal structuring of disposals – advise on efficient legal structures for asset or share sales or group reorganisations
Due diligence and risk management – conduct legal due diligence and identify issues that could impact deal value or timing
Drafting and negotiation of key documentation
Regulatory and compliance advisory – advising on employment, data protection and other regulatory issues
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