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What is the Employment Rights Bill 2025, and how does it affect small businesses?

This is a question we’re hearing more and more from clients across the UK—and with good reason. The Employment Rights Bill 2025 introduces sweeping updates to UK employment law, affecting how you manage flexible working, harassment, family leave, contracts and more.

At SYLO | Beyond HR, we help businesses like yours turn legal changes into practical action—so you can stay compliant and stay focused on your people.

What is the Employment Rights Bill?

The Employment Rights Bill is a government-backed piece of legislation due to take effect in 2025. It’s designed to modernise UK employment law, with new protections for employees and greater accountability for employers.

Key areas of reform include:

  • Harassment prevention
  • Flexible and predictable working
  • Family leave rights
  • Non-disclosure agreements (NDAs)

This is one of the most significant employment law updates in recent years, especially for SMEs.

Employment Rights Bill: What’s Changing?

If you’re asking, “What does the Employment Rights Bill mean for my business?” — here’s a breakdown:

  1. Legal Duty to Prevent Harassment

Employers will have a positive duty to prevent workplace sexual harassment. It’s no longer enough to wait until something happens.

What this means:

  • You must prove you’ve taken reasonable steps to stop harassment
  • NDAs can’t be used to cover up discrimination or poor handling of complaints
  • Policies and training must be active, not passive

How to prepare:
Update your harassment and inclusion policies, train line managers, and seek advice on NDAs.

  1. Day-One Right to Request Flexible Working

Employees will be able to request flexible working from the first day of employment. Employers must respond within 2 months and can only reject requests for valid business reasons.

You’ll need to:

  • Review your flexible working policy now
  • Brief your managers on how to respond fairly
  1. Right to Request Predictable Working Patterns

Agency, casual and zero-hours workers with 26+ weeks’ service can now request regular, reliable hours.

What this covers:

  • Zero-hours and gig economy staff
  • Agency workers and irregular shift patterns

Advice: Review your use of flexible contracts and prepare to formalise where appropriate.

  1. New Statutory Leave Types

The Bill introduces three new types of time off:

  • Carers’ Leave (5 unpaid days/year)
  • Pregnancy Loss Leave (before 24 weeks)
  • Neonatal Leave (up to 12 weeks paid)

What to do:

  • Update your leave policies and contracts
  • Train managers to handle these conversations compassionately
  • Prepare HR systems to record and manage new leave types
  1. New NDA Restrictions

Settlement agreements can no longer silence employees about:

  • Harassment or discrimination
  • How their complaint was handled

This change reinforces transparency and may increase reputational risks if handled badly.

Best practice:

  • Review settlement agreement templates
  • Ensure confidentiality clauses meet the new legal standard
  • Seek HR or legal advice before issuing NDAs

How Does This Affect Your Business?

If you’re a UK employer, especially in the SME space, here’s what’s at stake:

  • Contracts must be reviewed
  • Policies must reflect new rights
  • Managers need upskilling
  • Leave and scheduling systems need updating

Waiting until enforcement could mean:

  • Breaching employee rights
  • Facing tribunal claims
  • Damaging your brand and team culture

What Should Employers Do Now?

Many SME owners are searching:

  • “How do I comply with the Employment Rights Bill?”
  • “Do I need to update my HR policies in 2025?”
  • “Who can help me review employment contracts?”

Here’s your checklist:

  • Review contracts, policies and handbooks
  • Audit casual/agency/flexible roles
  • Brief managers and HR teams
  • Create a plan for implementing changes
  • Speak to a trusted HR advisor (like SYLO)

SYLO | Beyond HR: Helping SMEs Stay Ahead

We help employers move from reactive to proactive HR with:

  • Legally compliant contracts and policies
  • Manager training on new rights
  • Support with flexible working, leave tracking, and workforce planning
  • Ongoing advice tailored to your business

Whether you need a one-off compliance check or retained HR support, we’re here to help.

Book Your Employment Rights Bill Health Check

Get ahead of the changes with a complimentary consultation.

Speak to our HR team
Email: enquiries@sylobeyondhr.com