Employment Rights Act 2025: Where Employer Policies Commonly Fall Short

The Employment Rights Act 2025 has changed the rules in several specific areas — redundancy consultation, whistleblowing protection, and statutory pay among them. What needs to be discussed is how those changes play out in the actual documents employers across London and the South East rely on day to day: redundancy procedures, whistleblowing policies, employee handbooks, and contracts.

In practice, this is where the gaps tend to show up.

Redundancy templates and consultation processes

Many redundancy policies and consultation frameworks were drafted around a site-by-site view of headcount reductions — because that's how the rules used to work. Under the Act, redundancies are now assessed on an organisation-wide basis. A redundancy approach that still frames consultation thresholds by location, rather than across the business as a whole, may no longer reflect how those thresholds are actually triggered.

This matters in practice because consultation duties can now be triggered by proposed headcount reductions across an entire group structure, even where no single site crosses the old threshold on its own. A redundancy policy built around individual site numbers may simply never flag that a consultation obligation has arisen.

Similarly, with the maximum protective award for collective consultation failures now standing at 180 days' uncapped pay per affected employee, the financial consequence of a redundancy process falling short has changed considerably. .

Whistleblowing policies

Most whistleblowing policies set out categories of protected disclosure — health and safety, financial wrongdoing, breaches of legal obligations, and so on. Under the Act, a report of sexual harassment can now amount to a protected disclosure in its own right, provided the statutory tests are met. A policy that doesn't reflect this may mean managers handling a harassment complaint don't recognise it as sitting within whistleblowing protection — which affects how it should be investigated, recorded and responded to.

This is less about the policy document itself and more about whether managers handling complaints understand the category has changed. A policy can be technically updated and still fail in practice if the people applying it day to day haven't been told what's changed — which is why a policy review and a short briefing for managers often go together.

Employee handbooks and contracts

Handbooks and contracts are often the last documents to be revisited, simply because they don't change often. But statutory pay increases under the Act have knock-on effects — on how pay structures, overtime, and family-related leave provisions are described — that can leave handbook wording technically inaccurate even if no one intended it to be.

None of these gaps tend to be dramatic on their own. The risk is cumulative: a procedure here, a policy category there, a handbook clause that hasn't kept pace — each individually minor, but together representing a meaningful gap between what the Act now requires and what's actually in place. And these gaps don't sit in isolation from one another, which can mean two separate gaps interact in ways that are harder to untangle once a dispute is underway. It is also worth noting that the April 2026 changes addressed here are the first phase of the Act's implementation — further provisions due in October 2026 and January 2027 will require policies, procedures and contracts to be revisited again.

Next reads in the series

Employment Policy Reviews: Why Timing Matters Under the Employment Rights Act 2025

Employment Law: The Issues Employers Are Asking About Most

FAQs

Why do redundancy procedures need revisiting under the Employment Rights Act 2025?

Many redundancy procedures were built around a site-by-site assessment of headcount reductions, but the Act now requires an organisation-wide approach — meaning consultation thresholds may be triggered differently than the employer assumes, and the maximum protective award for getting this wrong is now 180 days' uncapped pay per affected employee.

Does a whistleblowing policy need updating under the Employment Rights Act 2025?

If a whistleblowing policy doesn't reflect that, provided the statutory tests are met, a report of sexual harassment can now amount to a protected disclosure in its own right, managers handling such complaints may not recognise them as falling within whistleblowing protection.

Why would an employee handbook be affected by pay changes under the Employment Rights Act 2025?

Statutory pay increases can affect how pay structures, overtime and family-related leave are described in employee handbooks — wording that was accurate previously may no longer be.

What are the most common employment policy mistakes under the Employment Rights Act 2025?

The most common gaps are redundancy policies built around site-by-site thresholds that no longer apply, whistleblowing policies that don't reflect sexual harassment as a protected disclosure category, and handbook wording that hasn't kept pace with statutory pay changes — each individually minor, but cumulatively significant.

Are there further changes under the Employment Rights Act 2025 that will affect employment policies?

Yes. The April 2026 changes are the first phase of a longer programme of reform. Further provisions are expected in October 2026 and January 2027, including the removal of the compensation cap, the reduction of the two-year qualifying period for unfair dismissal claims, increased protection against sexual harassment and a ban on fire and rehire — all of which will require policies and procedures to be reviewed as those provisions come into force.

About the Author

Michael Pope is Head of Employment and Corporate Commercial Specialist at Grant Saw Solicitors, where he leads the development of the firm's Business Services practice. With over four decades' experience, he advises businesses, directors and contractors on employment law, risk management, and company and commercial matters.

Michael began his career at Woolsey Morris & Kennedy Solicitors in 1983, becoming a partner in 1987, before founding Lawbridge Solicitors in 2008. He holds a Masters in Employment Law and Relations with Distinction from the University of Leicester and is regulated by the Solicitors Regulation Authority (SRA No. 128429).

Employment law advice

Our Employment team advises businesses, directors and contractors across London on employment law, risk management and the practical implications of legislative change. To discuss a review of your organisation's current position, call 020 8858 6971 or email michael.pope@grantsaw.co.uk or yasmin.awan@grantsaw.co.uk.

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Disclaimer

This article is for general information only and is not legal advice. Laws and guidance change and outcomes depend on facts. If you need advice on your situation, please contact us. Grant Saw Solicitors LLP is authorised and regulated by the Solicitors Regulation Authority.

Last updated: 17 June 2026