Employment law changes from April 2026: what employers need to do now

April 2026 marks the first major phase of the Employment Rights Act 2025 reforms, marking a significant shift in employment law. It combines:

• Annual statutory rate increases, which came into effect on 1 April 2026;
• Immediate legal change with higher financial exposure in key areas including sickness absence, redundancy, whistleblowing and family leave, which came into force on 6 April 2026; and
• Establishment of the Fair Work Agency, a worker’s rights enforcement body, established on 7 April 2026.

Statutory sick pay (“SSP”): higher cost, more administration, wider eligibility

The SSP reforms are likely to have the biggest day-to-day operational impact:

• SSP is now payable from the first day of sickness absence, removing the current 3-day waiting period.
• The lower earnings limit has been removed, meaning lower-paid workers who previously fell outside the regime are now eligible.

For businesses which already offer day-one contractual sick pay, the practical effect may be limited. For everyone else, the change is more significant. It is likely to mean more short-term absence reporting, more payroll administration and closer scrutiny of how line managers handle short-term absenteeism. Absence policies, payroll processes and manager training should now be reviewed.

Day-one paternity leave and unpaid parental leave

Paternity leave and unpaid parental leave become day-one rights:

• Employees no longer need 26 weeks’ service to qualify for paternity leave or one year’s service to qualify for unpaid parental leave.
• There is no change to the qualifying service requirement for Statutory Paternity Pay (i.e. 26 weeks).

This means an employee may be entitled to parental leave from day one of their employment, but not to be paid for it. This distinction matters. Employers who do not explain this, risk confusion, or possibly even grievances and payroll disputes.

Policies and template communications should be updated to make clear that the entitlement to paternity leave is separate from the entitlement to paternity pay.

New Bereaved Partner’s Paternity Leave

Bereaved Partner’s Paternity Leave gives eligible fathers and partners a day-one right to take up to 52 weeks’ leave where the mother or primary adopter dies within the first year of the child’s birth or adoption. The legislation does not create a statutory right to pay for this type of leave.

Collective redundancy: the cost of getting it wrong doubles

• The maximum protective award for breach of collective consultation obligations doubles from 90 days’ pay to 180 days’ pay per affected employee.
• This materially increases the financial risk where an employer fails to consult properly in a collective redundancy exercise.

The consultation trigger itself has not changed and the current obligation, where an employer proposes 20 or more redundancies at one establishment within 90 days or less, still applies. However, the government is consulting on whether that threshold should be assessed across the whole organisation rather than by reference to one establishment.

Employers should audit their collective consultation processes now, as a rushed or superficial process now has the potential to be far more costly.

Whistleblowing: sexual harassment reports get stronger protection

A report that sexual harassment:

• has occurred; or
• is occurring; or
• is likely to occur,

now becomes a qualifying disclosure for whistleblowing purposes. Workers will no longer need to fit such a report into another category of qualifying disclosure in order to obtain whistleblowing protection. This means that failing to properly deal with a complaint of sexual harassment may now result in exposure to a whistleblowing claim as well as a sexual harassment claim under the Equality Act 2010. This makes effective middle-management training critical, as most legal exposure in this area comes not from the existence of a complaint, but from how it is handled once raised.

The Fair Work Agency (“FWA”) - a new enforcement regime

The FWA has been established as a new single enforcement body which the government intends to sit at the centre of a stronger state enforcement model for workplace rights. Compliance failures which some businesses have historically treated as low-risk issues, such as holiday, minimum wage and statutory payments, are becoming more visible enforcement risks. Employers should consider whether they have sufficiently robust systems in place, especially in areas where pay practices are complex, poorly documented or have evolved informally over time.

Equality action plans: voluntary now, likely to be mandatory in 2027

• Employers with 250 or more employees will be able to publish voluntary equality action plans addressing issues, including the gender pay gap and support for employees experiencing menopause.
• The government intends these to be mandatory from spring 2027.

For larger employers, this is an opportune time to get ahead of this requirement, before it is compulsory. Early preparation will make mandatory reporting easier and lower the risk of a rushed, box-ticking response.

Statutory rate increases

From 1 April 2026:

• The National Living Wage for workers aged 21 and over increased to £12.71 per hour;
• The 18 to 20 years old rate increased to £10.85 per hour; and
• The 16 to 17 years old and apprentice rates increased to £8.00 per hour.

From 6 April 2026, SSP rose to £123.25 per week, while the weekly rate for statutory maternity, paternity, adoption, shared parental and related family payments also increased for the 2026/27 year.

Wider legislative reform for 2026/27

The April reforms are the start of a wider legislative programme with the Government’s current implementation timeline pointing to further changes in October 2026, with additional measures from 1 January 2027.

This includes the planned reduction in the unfair dismissal qualifying period to six months and removal of the compensatory award cap. The same timeline says the extension of tribunal limitation periods is expected no earlier than October 2026, so that change should still be treated as pending rather than fixed.

Action for employers now

Employers should focus on 4 key areas now to ensure compliance:

1. Update family leave and sickness policies;
2. Check payroll settings against the April rate changes;
3. Refresh manager training on whistleblowing and harassment concerns; and
4. Review redundancy consultation procedures.

How Hamlins can help

If you would like to discuss how these changes may affect your business or how to ensure compliance, please get in touch with Penny Hunt, Head of our Employment team.

Our Employment team advises both employers and employees on all aspects of employment law, providing support and guidance on the full range of employment issues which arise during the employment life cycle, from recruitment through to redundancies, performance dismissals and executive exits.