With no end date yet in sight, employers could be forgiven for asking: ‘What the 😵💫 is going on?’
From default flexible working and day-one rights, to tougher rules on sick pay, tribunals and harassment, the
Employment Rights Bill was a much-heralded part of Labour’s election manifesto. Described as an ambitious and ‘game changing’ package of reforms, Labour says that the Bill is both ‘pro-business’ and ‘pro-worker’.
Politics aside, this flagship commitment represents a major overhaul of workers’ rights that will impact every employer in the UK in some way.
Where Are We Now
The Bill had been expected to gain Royal Assent and pass into law this autumn, to begin a phased two-year implementation. However, as of the end of November 2025, it’s still in limbo - stuck in a battle of wills between the House of Commons and the Lords.
The Bill is not without controversy, containing some challenging legal reforms for SMEs.
Most notable are changes to the qualifying period for unfair dismissal and other ‘day 1’ rights; improved access to flexible working; extension of time limits for bringing tribunal claims; the requirement to offer guaranteed hours to qualifying zero and low hours workers; changes to statutory sick pay; and industrial action thresholds.
While the drama in Westminster may seem distant from the daily reality of running a business, and only of interest to employment law geeks, what’s happening is far from normal.
What’s The Problem?
Peers from all sides of the political spectrum are worried about achieving a balance between enhanced worker protections and the potential burdens on employers, particularly small businesses. Their concerns centre around:
- Day one unfair dismissal rights
- Zero-hours contracts with guaranteed hours
- Industrial action rules
Ordinarily, convention dictates that the upper house allows the Bill to proceed to law - particularly if it is a manifesto commitment. However, peers are so worried that they’ve made
amendments to the three areas of most concern. It’s an unusual move that has resulted in a game of parliamentary ‘ping pong’, with the Bill moving back and forth between the two houses.
Both sides appear set in and the Lords, contrary to usual etiquette, show no sign of weakening in their resolve. The government is pressing on, at present seemingly determined to stick to its original mandate, with the Commons rejecting the most recent amendments made by the House of Lords.
Not being able to get a flagship Bill through parliament without keeping its manifesto pledge of basic rights from day one intact, would make the government look weak. And it’s already under pressure.
👀 So What Happens Next?
- The Bill must now return to the Commons once again, scheduled for 8 December, to further debate the Lords’ position.
- If ministers are still determined not to compromise on their manifesto commitment that the bill should pass unamended, the game of parliamentary ping pong may continue.
- Other options would be for the government to respond to the Lords’ feedback and find some agreement.
- Alternatively, they could invoke the Parliament Acts - a rarely used power allowing them to present legislation for Royal Assent without the approval of the House of Lords.
Whatever happens next in this parliamentary stand off, delay to the legislation will inevitably cause more uncertainty for employers.
WorkSmarter will continue to keep you updated as events unfold.
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