The Employment Rights Bill: What Small Businesses Need to Do Now

The Employment Rights Bill is the most significant piece of UK employment legislation in a generation. Whether you employ 2 people or 200, these changes will affect how you hire, manage and – if necessary – dismiss staff.

For a complete set of ready-to-use documents, see our people and HR legal pack.

What's Changing (The Headlines)

• Day-one unfair-dismissal rights – currently employees need two years' service; this will become a day-one right subject to a statutory probationary period (expected nine months)
• Zero-hours and low-hours contracts – employers must offer guaranteed-hours contracts to workers who regularly work more than their minimum
• Restrictions on fire and rehire – automatically unfair except in genuinely existential circumstances
• Statutory sick pay (SSP) – removing the three-day waiting period and lower-earnings limit
• Flexible working – tighter grounds on which employers can refuse
• Single enforcement body – a new Fair Work Agency

What You Should Be Doing Now

Audit your contracts. Make sure all employees have compliant written statements. Check that probationary-period clauses are flexible enough. See our guide on making sure your employment contracts are fit for purpose.

Review your dismissal processes. You'll need a fair process from the start. Make sure you have clear procedures – see getting your disciplinary and grievance procedures ACAS-compliant.

Check zero-hours arrangements. Start tracking actual hours worked to assess exposure.

Train your managers. The biggest unfair-dismissal risk is a manager who acts before thinking.

For the full annual compliance picture, see your 2026 legal housekeeping checklist.

How Our HR Templates Help You Prepare

Our HR template pack includes employment contracts with flexible probationary-period clauses, an employee handbook covering ACAS-aligned procedures, and policy templates for flexible working, sick pay and performance management.

Related reading

• Handling Disciplinary And Grievance
• Employment Contract Essentials