April action plan: the latest ERA 2025 reforms

The upcoming reforms introduce a series of significant changes across union recognition, redundancy consultation, leave entitlements, sick pay and workplace protections. Lower thresholds and simplified procedures will make union recognition more accessible, while increased penalties will heighten the risks around collective redundancy processes. Day‑one rights for paternity and parental leave, expanded Statutory Sick Pay eligibility and strengthened whistleblowing protections all broaden employee entitlements. Additional reporting options on gender equality and menopause support, alongside the establishment of the Fair Work Agency, signal a more proactive enforcement landscape. Employers should review and update their policies now to ensure they are ready for these developments.

In this briefing we cover:

• Trade union recognition
• Collective redundancy protective award
• Paternity and parental leave
• Statutory Sick Pay
• Sexual harassment - whistleblowing
• Equality/ menopause action plans
• Fair Work Agency

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Trade union recognition

Employers should prepare for more applications for union recognition, and a greater likelihood of those applications succeeding, potentially in relation to a larger proportion of their workforce.

Union recognition by an employer will be streamlined in three key respects:

1. Lower membership threshold: The requirement to show that at least 10% of workers in the bargaining unit are union members will be reduced (potentially down to as low as 2%). This could result in bargaining units being drawn more widely, increasing the union’s sphere of influence.
2. No need to show likely support: The requirement to show that at least 50% of workers in the bargaining unit are likely to support recognition is removed. 
3. Ballot support thresholds are reduced: The requirement that at least 40% of the workers constituting the bargaining unit vote in favour of recognition will be removed. All that will be required to support recognition is a simple majority of those voting.

Collective redundancy protective award

Employers should ensure they have robust procedures in place to meet the consultation requirements; and also look out for further ERA changes to these obligations in 2027.

Where an employer proposes to dismiss as redundant at least 20 employees at one establishment within a period of 90 days or less, it must comply with a statutory collective consultation regime before effecting those dismissals. If the employer fails to comply, it may face liability for a protective award of up to 90 days’ pay per affected employee. From 6 April 2026, that maximum will double to 180 days’ pay per affected employee. This significantly increases the financial exposure for employers who fail to meet these consultation duties. 

Paternity and Parental Leave

Employers should update their leave policies to reflect these changes, and anticipate more employees exercising family leave entitlements.

Statutory paternity leave and unpaid parental leave previously had qualifying periods of 26 weeks and one year respectively. From 6 April, these qualifying periods are removed, and both will become day one rights. The restriction that prevented employers from taking paternity leave after a period of shared parental leave will also be removed.

Statutory Sick Pay

Employers should amend their sickness policies and consider if any changes should be made to enhanced sick pay schemes, to offset some of the additional cost.

The Act expands eligibility for Statutory Sick Pay ("SSP"), by removing both the three-day waiting period and the lower earnings threshold. This means that SSP will become payable from day one of absence (instead of day four), and will cover employees regardless of their level of income. The rate of SSP is also changing, so instead of a fixed weekly rate (currently £116.75 per week), employees will receive the lower of the flat rate or 80% of their normal weekly earnings. 

Sexual harassment - Whistleblowing

Employers should prepare for more sexual harassment concerns to be raised through whistleblowing channels, and ensure their policies and reporting procedures are up to date.

Under UK whistleblowing legislation, disclosures are protected if the worker has a reasonable belief that one or more of a prescribed list of failures has occurred (or is likely to occur). These include criminal offences, health and safety breaches, environmental damage and breach of any other legal obligation. From April 2026, a disclosure that sexual harassment has occurred, is occurring, or is likely to occur is added to this list. Although sexual harassment allegations would likely have already fallen within one of the existing categories, this change highlights the availability of whistleblowing as a means to raise sexual harassment complaints (alongside other channels, such as grievances). 

Equality / menopause action plans

Although these action plans are currently voluntary, they will become mandatory in 2027, so employers should begin considering how they will formulate their plans.

Large employers with 250 or more employees are required to submit annual gender pay gap reporting data. Action plans to address these gaps are not mandatory, but from April 2026 employers can choose to produce and submit these plans through the gender pay gap reporting portal. Action plans may also be produced and submitted for other gender equality measures, including supporting employees with the menopause (new government guidance on this is also anticipated for April 2026), and potentially measures to prevent sexual harassment. 

Annual leave records

Employers should ensure systems are in place to record workers' annual leave and comply with associated requirements - and be prepared for these records to be scrutinised by the new Fair Work Agency.

Employers will be subject to a new obligation to keep 'adequate' records of their workers' annual leave and pay entitlements, including irregular hours or part-year workers. The records must cover what elements of pay were included in holiday pay, and also show compliance with entitlements to payment for periods of annual leave and in lieu of annual leave, as well as night working. 

There is no prescribed format for how employers create, maintain and keep these records, but they must be kept for at least six years. Employers who do not comply will commit an offence and face a fine, via enforcement action by the new Fair Work Agency.

Fair Work Agency

Employers should prepare for greater regulatory intervention. Advance audits of holiday pay and SSP compliance are advisable, and businesses should monitor employment rights added to FWA’s remit.

7 April 2026 sees the launch of a new single enforcement body, the Fair Work Agency ("FWA"). It will initially consolidate the roles of HMRC’s National Minimum Wage team, the Gangmasters and Labour Abuse Authority and the Employment Agency Standards Inspectorate. Holiday pay enforcement will also be within its jurisdiction, and there is potential for further expansion of its remit. The FWA will have a range of investigatory and enforcement powers, including workplace inspections and document requests. It will be able to issue notices of underpayment, ‘name and shame’ non-compliant employers, bring tribunal claims on behalf of workers, and recover enforcement costs. An advisory board and regular reporting will underpin its strategic approach, creating a more interventionist compliance landscape for employers.