Preparing for the Employment Rights Act: Cultural changes?

Preparing for the Employment Rights Act: Cultural changes?

Sarah Furness, Employment Law & HR

Further to our last update setting out the detail of the Employment Rights Act, Sarah Furness, Partner in the Employment Team, has set out below steps that employers can take to prepare, and potential cultural shifts which need to be considered.

Recruitment
As employees who have six months’ service as of 1 January 2027 will be able to pursue unfair dismissal claims, employers who are recruiting over the next few months must ensure that they recruit the right people for the right roles. It is therefore essential that recruitment processes are thorough and robust, and that time is taken to ensure recruitment, often an expensive and time-consuming exercise, is worthwhile.

Most probationary periods are already six months, and it is of course hoped that employers and employees within that six-month period are able to establish whether the role and person are a match! However, this isn’t always the case and employers who haven’t previously given much thought to their recruitment processes will need to shift their priorities promptly. It is important now more than ever to make recruitment count by ensuring roles are clearly defined, a diverse range of candidates apply and that skills and behaviours are adequately assessed.

Managing well
More focus should also be placed on managing employees well from day one of their employment. An effective onboarding process is key so that employees are equipped to do their role from the outset and so that they ‘buy into’ your brand as an employer. Setting expectations, checking in with new employees regularly and providing adequate support is essential as is ensuring managers are trained in being able to lead people and get the best out of them. If you have a team of “accidental managers”, culturally it is time to make a shift and invest in training managers who are equipped with the skills to lead.

Zero-hours contracts
As employers are going to have to offer a guaranteed hours contract to zero-hour or low-hour contract workers, now would be a good time to review your use of such contracts within your organisation. Careful financial planning will also be required particularly where you are in an organisation where work regularly fluctuates, i.e. seasonal businesses. Offering annualised hours contracts can be an alternative, albeit the contract would have to be very clear as to the hours to be worked and when they are to be worked to avoid being caught by the new zero-hours “protections”. Due to the need to give reasonable notice of cancellations and changes to shifts (and to pay compensation for said cancelled/changes shifts) it is also important that employers put systems to monitor and communicate shifts to be worked and that managers know to follow them consistently.

Sickness absence
As statutory sick-pay is to become a day-one right and the three-day waiting period to be paid it is to be removed, it is possible that sickness absence levels will increase. It would therefore be good practice for organisations to review how they manage sickness absence and introduce appropriate policies and processes relating to the reporting of absences and when the instigation of return-to-work interviews, formal sickness absence processes and Occupational Health referrals is appropriate. Putting in place measures to support employees with their health will also assist.

Equality, diversity and inclusion
Although the change to the law on flexible working is a subtle one in that employers now have to state why a flexible working request in unreasonable, this and the requirement for employers who have over 250 employees to introduce Equality Action Plans does mean that there is to be a continued focus on strengthening protection for workers from an equality and diversity perspective. The duty to take reasonable steps to prevent harassment is also to be extended and a review of the UK’s entire family and parental leave system is planned for 2026. As a result of all of these changes, employers who do not give any thought to their equality, diversity and inclusion strategies are strongly recommended to do so urgently to ensure that those who are protected under the Equality Act 2010 are being adequately supported. It is also clear that employees place much more importance on flexibility than ever before and this is something employers need to consider from a cultural perspective.

Trade union recognition
Finally, with Trade Union recognition becoming easier under the Employment Rights Act, a cultural shift likely will be needed for some employers in respect of how they can embrace and engage with Trade Unions so that such communications can be productive for all parties.

The Employment Team is currently supporting various employers in planning for the changes and amending their contracts and policies where needed. Get in touch to find out how we can help you.