It's all change in Employment Law in 2025

There are 8 proposed changes and one completely new piece of legislation contained in the Employment Rights Bill currently at consultation stage in Parliament, that means that the changes will happen, but for the majority of changes, we just don’t know when.

The Autumn Budget in 2024 announced that there are two financial changes that will arrive next month (April 2025), the rest will in all likelihood, arrive in phases throughout the year, usually in April or October. So, below is an overview of the changes coming into effect.
Items to be changed:

1. The National Minimum and Living Wage
2. National Insurance
3. Employment Rights from start date
4. Trade Union Rights
5. Fire and re-hire
6. Unfair Dismissal
7. Statutory Sick Pay
8. Zero Hour contracts
9. Neonatal Care leave 

National Minimum and Living Wage:

•    The National Living Wage increases from £11.44 an hour to £12.21. 
•    The National Minimum Wage increases from £8.60 an hour to £10.00.

National Insurance:

•    Employers’ contributions to National Insurance will increase from 13.8% on any figure over £9500.00 per annum to 15% on any figure over £5000.00 per annum.
•    Employment Allowance for businesses increases from £5,000.00 to £10,000.00.

Employment Rights from start date

Employees will obtain employment rights from their first day in any job. This is currently a right that is obtained after 2 years of continuous employment. Employers will need to ensure contracts are updated to reflect this. (This is likely to come into effect in 2026).

Trade Union Rights:

All employers will be required to inform all employees of their right to join a Trade Union.

Fire and re-hire:

It will no longer be permitted for employers to use the fire and re-hire tactic. There will be one exception to this rule, which is where a company needs to fire and later re-hire an employee when to avoid the company becoming insolvent. If a company uses this exception, they will need to show evidence of the financial difficulty it is in.

Unfair Dismissal:

Currently, an employee cannot claim for unfair dismissal until after they have gained employment rights after two years’ continuous service, except in discrimination cases, (see above changes regarding rights to obtained from start date).  The law will introduce a statutory probationary period and once that period has been completed, an employee will then obtain the right to claim unfair dismissal.

Statutory Sick Pay:

Eligibility for an employee to receive statutory sick pay (SSP), starts after the fourth consecutive day of sick leave. This will change so that an employee will receive SSP from the first day of illness until the end of the sickness period, with no limitation. This will be the case from the first day of an employee’s employment.

Zero-Hour contracts

These types of contracts will no longer be legal, unless an employee already on a zero-hour contract requests to stay employed on that basis. Employees will have the right to request a fixed hours contract.

Neonatal Care Leave and Pay:

The Government has confirmed that a new right to neonatal leave and pay will be introduced and will take effect from 6 April 2025 under the Neonatal Care (Leave and Pay) Act 2023. If you are an employer, please click HERE for more information on updating your policies etc. 

To find out more about employee rights, click HERE. 

If you are an employer or employee needing further advice and guidance, when it comes to the latest Employment Rights Bill, contact our team today on 01926 491181 or email: employment@moore-tibbits.co.uk.