Employment Rights Bill: Update Following House of Commons Approval on 12 March 2025

Employment Rights Bill amendments approved by House of Commons on 12 March 2025. Key changes and implications since February update outlined.

Recent amendments to the Employment Rights Bill were approved by the House of Commons on 12 March 2025. Below, we outline the key changes and their implications since our last update on the progress of the Bill, given in February. 

Statutory Sick Pay (SSP) 

Workers earning less than the lower earnings limit (LEL) (£123 per week) stand to be paid sick pay (previously those below the LEL were excluded). The Bill was amended to give those earning below the LEL a right to sick pay at 80% of average weekly earnings, meaning employees will be entitled to the lower of the SSP weekly rate or 80% of average earnings as soon as they are off sick from work. 

From 6 April 2025 the new level of statutory sick pay will be £118.75 or 80% of an employee’s weekly earnings. As an example, an employee earning £125 a week would currently  receive the sick pay rate of £118.75. When the proposed changes come in, they would instead receive £100.

Zero-Hours Contracts and Agency Workers 

The Bill originally gave workers on zero or low hours contracts the right to receive an offer of fixed hours based on their normal working pattern over a period of time (indicated to be 12 weeks). 

A loophole was identified where employers could get around this protection by engaging staff through an agency. An amendment to the Bill entitles agency workers to the right to be offered guaranteed hours if they are on zero/ low hours contracts. 

The responsibility will fall on end hirers to manage current and future requirements. Regulations will clarify when the obligation to provide guaranteed hours will fall on the agency, where this is more practical. 

The liability for paying compensation will be with the agency but there will be a right to recover the cost from the hirer. 

An amendment allows these rights to be excluded through the use of a collective agreement, possibly as an incentive to employers to recognise trade unions.

Collective Redundancy Consultation 

The changes to the collective consultation rules are among the most important amendments made to the Employment Rights Bill in March 2025.

Currently, if an employer plans to make 20 or more redundancies at one location within 90 days, they must follow collective consultation rules and notify the Secretary of State using the HR1 Form.

The Bill originally removed the phrase ‘at one establishment’ from section 188 of TULRCA, meaning that collective consultation would have been required if there are 20 or more redundancies across the entire business. The amended version reinstated this but proposes to introduce a trigger for s.188 TULRCA if a (to be confirmed by regulations) number of redundancies across an organisation is proposed.

The maximum protective award for failing to consult properly will increase from 90 to 180 days’ gross pay per employee.

In ‘fire and rehire’ situations, if an employer does not follow the Code of Practice on Dismissal and Reengagement, an employment tribunal can increase the protective award by up to 25%. With the new 180-day cap, this uplift could now add up to 45 days’ pay, compared to the current 22.5 days on the 90 days’ gross pay cap. 

Trade Union Rights

The original Bill included access agreements, now expanded to encompass digital/virtual access, acknowledging that virtual meetings are a feature of a modern workplace and hybrid practices.

On recognition procedures, the amended Bill simplifies the process by stipulating that 10 days after the Central Arbitration Committee (CAC) receives a union's recognition application, the number of workers in the proposed bargaining unit cannot be increased. This is stated to prevent the recruitment or reorganisation of staff to prevent union recognition.

The membership requirement for union recognition applications remains at 10% of the bargaining unit. However, the Bill now grants the Government the power to lower this threshold to 2% in future regulations.

The Bill also streamlines the organisation of industrial action. It reduces the information required in ballot notices and the details unions must provide employers in industrial action notices.

The notice period for industrial action has been adjusted from 14 days to 10 days. Additionally, the requirement for a minimum 50% turnout before validly calling industrial action will remain for now, pending consultation on electronic balloting.

Votes in favour of industrial action will now be valid for 12 months, instead of the previous 6-month duration.

New Bereavement Leave for Miscarriage 

The Bill includes provisions to expand the existing right to statutory parental bereavement leave into a more general form of bereavement leave. 

During the Report stage, an amendment was proposed to grant two weeks of paid bereavement leave to those experiencing pregnancy loss due to miscarriage. This amendment did not pass but the Government has accepted the principle of bereavement leave for pregnancy loss in response to the Women and Equalities Committee report on the Bill, which suggests that the Bill will be amended to include this provision again as it progresses through Parliament.

Progression of the bill

The Bill has proceeded to the House of Lords, having its first reading there on 27 March. It will return to the Commons for consideration of amendments by the Lords before receiving Royal Assent.

Some legal commentators have suggested that if the Bill follows the usual process through the Lords, it could receive Royal Assent before Parliament's recess in July 2025, with some provisions potentially coming into force by October 2025.

However, implementation this quickly seems unlikely, as the original 158-page Bill has now doubled to 310 pages following amendments. Many of these new amendments are expected to be scrutinised in more detail as the Bill progresses. 

It is more likely that the provisions will start to come into force in 2026, with further consultations on practicalities taking place this year. However, a select few provisions may have an earlier implementation date.

If you would like to discuss any aspect of this article further, please contact our employment team on 0113 244 6100. 

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The information in this article is necessarily of a general nature. The law stated is correct at the date (stated above) this article was first posted to our website.

Specific advice should be sought for specific situations. If you have any queries or need any legal advice please feel free to contact Wrigleys Solicitors.