Employment Rights Act changes for SMEs: key dates employers need to know in 2026 and 2027
The Employment Rights Act brings a series of important employment law changes for SMEs, and the timetable matters just as much as the detail. Rather than one single change date, employers need to prepare for reforms being introduced in stages across 2026 and 2027. Our Employment Rights Act Roadmap sets out the key milestones simply, helping businesses understand what is coming and what they should review now.
Employment Rights Act key dates for SMEs
The roadmap highlights the main implementation dates employers should be planning for now:
6 April 2026 – first wave of practical changes
7 April 2026 – Fair Work Agency becomes operational
August 2026 – trade union ballot changes
October 2026 – harassment, tipping and union access
January 2027 – unfair dismissal and fire and rehire
2027+ – further rights still to be confirmed
For SME employers, this phased approach means preparation should start well before each date rather than waiting until changes come into force.
What changes from 6 April 2026?
The first major wave of change arrives on 6 April 2026. This includes day-one rights to paternity leave, unpaid parental leave and bereaved partner’s paternity leave. It also includes statutory sick pay from day one of sickness, removal of the lower earnings limit, and changes meaning eligible workers receive 80% of normal weekly earnings or the flat SSP rate, whichever is lower.
There are also changes around redundancy, trade unions and whistleblowing. If collective consultation is missed, the protective award can rise to 180 days’ pay. Trade union recognition rules are simplified, and there is an explicit definition of protections for workers who make a disclosure relating to workplace sexual harassment.
For SMEs, this is likely to mean reviewing family leave policies, sickness absence processes, payroll readiness and manager understanding of redundancy risk.
Recent update = From 6 April 2026, employers must keep annual leave and holiday pay records, including carry-over and any payments in lieu, for at least 6 years.
Why 1 July 2026 matters
One key date in our roadmap is the 1 July 2026 planning checkpoint. Anyone employed on or before this date will have at least 6 months’ service by 1 January 2027, which matters because unfair dismissal protection changes from that date.
That makes summer 2026 an important point for businesses to review recruitment, probation, performance management and documentation.
What is changing later in 2026?
The roadmap highlights August 2026 as the point where electronic and workplace balloting can be used for statutory trade union ballots where the rules allow. It also marks 7 April 2026 as the date the Fair Work Agency starts operating, bringing together enforcement activity currently spread across different bodies.
Then in October 2026, the focus shifts to harassment, tipping, trade unions and tribunal time limits. Employers will need to take all reasonable steps to prevent sexual harassment, and there can be liability for harassment by third parties such as customers or clients. Tipping policies must be consulted on with workers and reviewed at least every 3 years, while the time limit to bring tribunal claims is extended from 3 to 6 months.
These changes are particularly important for employers with line managers, customer-facing teams and busy operational environments where policy alone is not enough without manager awareness and practical reporting routes.
What changes in January 2027 and later?
From January 2027, unfair dismissal protection starts after 6 months instead of 2 years, the compensatory award cap for unfair dismissal is removed, and dismissal for refusing a contract change will usually be automatically unfair. Fire and rehire is shown as being severely restricted, with only a narrow exception where the employer can evidence financial difficulties.
Later in 2027, the roadmap points to guaranteed hours rights for zero-hours and low-hours workers, reasonable notice of shifts and compensation for cancelled or cut-short shifts, further flexible working changes, stronger protection for pregnant workers and those returning from maternity leave, a new day-one right to bereavement leave, widened collective redundancy rules, and mandatory gender pay gap and menopause action plans for employers with 250+ employees.
What should SMEs do now?
The roadmap’s immediate actions section is a useful starting point. It recommends reviewing family leave and sickness absence policies, checking payroll is ready for day-one SSP and lower-paid employees, briefing managers on redundancy consultation risk, and making sure harassment reporting routes are clear and easy to use. It also advises refreshing contracts, handbooks and manager guidance in stages, keeping written records of action taken, identifying the workers most likely to be affected first, and planning manager training before each key implementation date.
For many SMEs, the challenge will be turning legal change into practical action. That is where a clear timeline helps.
Our Employment Rights Act Roadmap has been created to make these changes easier to understand and easier to plan for.
Click here to download the roadmap to get a clear view of the key dates, the main changes, and the practical steps your business should be taking now: download here
If you’d like to discuss any of the upcoming changes further, or sense check your policies, get in touch.
01723 344134
