Employment Law Update | May 2025
Welcome to our spring employment law update
Employment law advisor Brendan Bah provides an update on the Employment Rights Bill and reviews some of the cases and news stories shaping the workplace so far this year.
In the Law
Employment Rights Bill
The Employment Rights Bill has recently moved to the House of Lords for further scrutiny and debate. If it progresses at normal speed, the Bill may receive Royal Assent before Parliament breaks for summer recess in July, which means that some parts of the Bill could come into force as early as October 2025. This could include:
- Employer liability for third-party harassment
- Increase in time limits from three months to six months for bringing some tribunal claims
The government has also published a 222-page document setting out the amendments to the original bill, which include the following.
Fair Work Agency
One of the most significant changes is in respect of powers to be given to the new Fair Work Agency, including:
- The ability to bring employment tribunal claims on behalf of workers, even if they were not going to claim themselves.
- The power to offer legal assistance for employment cases with any costs potentially recoverable from employers if the claim is successful.
- The authority to pursue employers for unpaid holiday and sick pay, and to impose financial penalties on top, which would go straight to the government.
This means that whilst employers would often wait to receive something from an ex-employee or ACAS, it could now be a well-funded government body that comes knocking. This could have a massive impact on how employers risk assess any employment issues.
Bereavement leave
Another change could see employees gain the right to bereavement leave after early pregnancy loss.
Legislation already exists allowing parents to take bereavement leave where they have lost a child or suffered a stillbirth after 24 weeks of gestation.
However, this is to be extended to cover a loss which occurs before 24 weeks.
Under the proposed changes, mothers and partners will be granted two weeks’ paid bereavement leave.
Some people have raised concerns about employers asking employees to substantiate the request for leave, which may be challenging if the miscarriage occurs in the first trimester before a scan has taken place. Although further clarification and guidance is needed from the government, it is hoped this leave will ensure employees take time off when it is needed most and will lessen the possibility of mental health concerns further down the line.
The Government has also offered further family-friendly support for workers through the Neonatal Care (Leave and Pay) Act 2023, which came into effect on 6 April. The Act allows parents of newborn babies requiring neonatal care up to 12 weeks’ extra leave on top of other leave they take, including maternity/paternity leave and shared parental leave.
The Bill is also set to introduce a new right to a minimum of one week’s unpaid bereavement leave for employees who have lost other loved ones (subject to eligibility requirements).
Additionally, the Government is looking to remove the current qualifying period of one year before employees can apply for parental and paternity leave for birth and adoption.
Sick pay
The Government has also reinforced its aim to support all workers by ensuring that statutory sick pay (SSP) is available from the first day of sickness absence, making it a legal right for workers for the first time. Currently employees are only entitled to SSP from day four of an absence.
As well as the removal of the qualifying period, employees on a low income who previously haven’t been entitled to claim SSP will now be able to. The Government’s recommendation is that employees earning below the lower earnings limit (£125 per week) will be able to claim sickness pay at a rate of 80% of their weekly earnings or the flat rate of SSP (currently £118.75 per week), whichever is lower.
Unfair dismissal and probation
For years, employers have relied on the two-year qualifying period before employees could claim unfair dismissal, but that is about to change. Under the Employment Rights Bill, employees will gain unfair dismissal rights from day one, meaning that dismissals will be open to immediate legal challenge.
There will be a new defined ‘initial period of employment’, which the Government has indicted could be six months with the option of a three-month extension. During this period, employers will be able to follow a ‘light-touch’ approach to dismissing employees.
Further information is still required as to:
- What any ‘light-touch’ approach would look like
- What (if any) dismissal protections might apply during the probation period
- What compensation employees could claim if dismissed early
- Whether tribunals will adopt a more lenient approach
This is one of the biggest changes to employment law in years. While it’s unlikely to take effect before autumn 2026, employers need to be aware and ready. Performance monitoring for all employees from day one will be crucial, as will dealing with any concerns or issues.
Right to disconnect
One issue that has been omitted is the ‘right to switch off’. While this was not part of the original Employment Rights Bill, it was expected to be added through the legislative process. The proposal would have allowed employees to ignore work-related emails and calls outside office hours, but there are now reports that ministers are set to abandon it altogether.
The reason for this is thought to be the extra burden it could impose on businesses, especially at a time when they are struggling with other challenges such as how to meet the increase in the National Minimum Wage and employers’ national insurance contributions.
Given Labour’s priority to support workers’ rights, it’s possible that the right to disconnect will resurface in the future.
Analysis
Hybrid working
Recent research has found that most women prioritise flexible working over other family-focused policies.
The study of more than 1,000 female workers found that two-thirds (67%) of women believe that their professional growth has been positively impacted by hybrid working, and that flexible work arrangements play a crucial role in supporting women’s careers, providing greater work-life balance and increasing productivity.
Almost half of those surveyed said hybrid working had led to promotions into more senior roles, while a similar proportion credited the increased flexibility as a key factor in their career advancement.
Across all age groups, the majority of respondents agreed that hybrid working had helped level the playing field for women in the workplace.
Supporting staff and especially working mothers with flexible working arrangements is therefore crucial. Recent statistics show the employment rate for mothers (75.6%) was higher than that of both women and men without dependent children. Employers would do well to take this into account when thinking about mandating staff to return to the office full time.
Employers who prioritise flexibility will have an advantage over those that don’t, especially where working parents and particularly mothers are concerned. According to the survey, 63 percent of those questioned stated that flexibility enabled them to remain in employment rather than leaving due to family commitments.
Many staff are now prioritising flexible working - not just working parents – as they recognise the valuable impact it has on their mental health and work-life balance.
Organisations that promote flexibility are now often seen as employers of choice, recognising not only the positive impact it has on their employees’ wellbeing but also on productivity.
McDonald’s: Further harassment allegations looming
McDonald’s, one of the UK’s largest private sector employers with 168,000 people working at more than 1,400 restaurants, recently revealed that it had been notified of 75 allegations of sexual harassment over the last 12 months and from these, 29 employees had been dismissed.
This is just the tip of the iceberg for the fast food chain, as more than 700 junior workers joined legal action against the company following allegations of widespread discrimination, homophobia and sexual harassment across its UK restaurants.
Current and former employees, some as young as 19 have instructed a law firm to take action on their behalf, in a move that has impacted nearly a third of its UK outlets.
One 19-year-old employee said they had been subject to homophobic comments from managers and other crew members. “I feel as though I can’t speak to any managers about it,” he said. “My manager said if I can’t deal with it, I should just leave the job. Things said to me shouldn’t be said to anyone, I’ve been called names like ‘f****t’. These comments make me feel really uncomfortable – I hate working there.”
Other examples of harassment included a young worker repeatedly being pestered for sex, another worker being asked sexual questions including how many people they had slept with, and another being asked for sex in return for extra shifts.
Ongoing complaints about harassment and discrimination have also caught the attention of the Equality and Human Rights Commission, which said it had received complaints about 300 reported incidents of harassment since the BBC’s original investigation in 2023.
The EHRC has now written to every McDonalds in the UK telling them they must comply with their legal duties or risk enforcement action, which could include court action.
Following the introduction of the Worker Protection Act in 2024, employers now have a legal obligation to take ‘reasonable steps’ to prevent the sexual harassment of their employees. This means not just dealing with the aftermath but being proactive and stopping incidents before they happen.
Employers can face massive compensation claims for failing to protect their employees from harassment, with tribunals also now able to increase compensation by 25% for employers not fulfilling their legal obligation.
Our recent webinar explained employer’s new legal duties and outlined steps they can take to comply. If you are interested in how LCF Law can support you with this, please contact us.
Gender identity and gender-critical beliefs
Gender identity remains a highly sensitive topic, with strongly held views on both sides ranging from the right of transgender individuals to have their identity recognised, to gender-critical beliefs that sex is a fixed biological characteristic, distinct from gender.
Recent case law has confirmed that gender-critical beliefs can qualify as protected philosophical beliefs under the Equality Act 2010. In Bailey v Stonewall and others, the employment tribunal found that an employer had discriminated against an employee, Bailey for holding gender-critical beliefs. This decision was mirrored in the decision of Adams v Edinburgh Rape Crisis Centre, where it was held that an employee, Adams had been discriminated against and constructively dismissed because of her gender-critical beliefs.
However, in Orwin v East Riding of Yorkshire Council, the tribunal dismissed employee Orwin’s claims that he had been discriminated against and unfairly dismissed for his gender-critical beliefs. It found that his dismissal was due to his use of an email signature with deliberately provocative preferred pronouns and that this was an inappropriate manifestation of his beliefs.
Cases such as Bailey and Adams highlight potential tensions between protected philosophical beliefs and other protected characteristics such as gender reassignment. In Fischer v London United Busways Ltd, although the tribunal dismissed Fischer’s discrimination claim, it observed that using a gendered slur against a trans colleague could amount to unlawful discrimination.
These varying outcomes illustrate the complex legal landscape and highlight the challenges employers face in upholding equality and preventing discrimination in the workplace.
If you're unsure how to navigate these sensitive issues or need advice on managing conflicting rights in the workplace, we can help.
In the Courts
Sexism in the workplace: The end of a 13 year battle
The Edinburgh Employment Tribunal has ordered the University of Edinburgh to pay over £1 million to a former professor for unfair dismissal following a 13-year legal battle.
The case dates back to 2010, when S and a colleague - then the only two remaining female professors from the original intake - raised concerns about gender discrimination. They described feeling “disabled in their employment” and requested a meeting with the university’s principal to discuss making their work viable.
A subsequent review of the engineering department highlighted a toxic culture. It noted efforts to deflect scrutiny from systemic issues and widespread perceptions among male staff that recent female appointments were based on “positive discrimination” rather than merit. Both female professors later received apologies, but the damage was done.
S was branded “distrusted and disliked” for speaking out, with colleagues instructed to communicate with her only through solicitors. The tribunal found this amounted to victimisation.
In 2012, S was dismissed when her work permit expired. While the tribunal accepted this could have been a fair reason for dismissal, it found the university had failed to follow proper procedure or explore reasonable alternatives to help her remain in the UK.
The university also failed to follow its own policies around sickness absence and disability support. Although the tribunal did not uphold a sex discrimination claim, it found S had suffered victimisation and disability discrimination.
This case is a stark reminder that failing to follow internal procedures - or worse, ignoring them - can lead to significant legal and financial consequences for employers.
Anyone for a cuppa?
An NHS nurse who was left out of a tea round (amongst other things) has won a payout at tribunal for an unfair constructive dismissal claim.
H was employed as a specialist diabetes nurse at an NHS trust but resigned in January 2022. At the tribunal she claimed that her co-worker N bullied her, ignored her in meetings and “stopped making tea for her when he was making it for all the other team members.”
H was awarded £41,000 by the South London employment tribunal due to her employer’s poor management of the situation.
One incident cited during the tribunal was when H and N were treating a patient, and after disagreeing on how best to threat the patient N told H “I don’t like you.”
Although the case is headlined as “a constructive dismissal due to being left out of a tea round,” the tribunal also uncovered evidence of an ongoing campaign by one employee to freeze H out over a considerable period.
Some behaviour in the workplace may initially seem inoffensive and petty but it can quickly escalate, and managers need to be able to step in when needed to address any issues before they escalate. To prevent issues like this from occurring, employers should:
- Have clear policies and procedures that give examples of bullying and harassment
- Train employees so they are aware of what constitutes bullying and the repercussions of not following policies
My name is…………..
A Birmingham tribunal has found that mixing up the names of ethnic minority employees is race discrimination.
S accused his colleague, B of racism when she referred to him by the name of another Indian employee. S stated that he looked and sounded very different from his colleague.
S worked with B, who is white, for a number of years and they got on well, but in a meeting in 2022 she referred to him as Bhuv, which was the shortened version of the other Indian colleague’s first name.
The employment judge stated that those from minority backgrounds are often “confused” with others of the same heritage, which can make them feel hurt and offended and “lumped together as a group” rather than being treated individually.
Following the meeting, S resigned and later submitted a grievance. His manager said B was “one of the kindest people he knew” and would only have got the names wrong “by accident.” The tribunal found there “could be no mistaken identity based on looks and voices” and concluded the mistake happened “because of his race.”
Expert employment law support
With parts of the Employment Rights Bill expected to come into force in 2025 alongside other new legislation and ongoing tribunal activity, HR teams are likely to face a busy and demanding year ahead.
Our employment law specialists are here to support you, whether that’s by clarifying the new legislation for you or reviewing your policies and procedures to ensure they meet it.
For advice and assistance, contact Brendan Bah on 07518 298 838 or ku.oc1750429420.fcl@1750429420habb1750429420, or James Austin on 07729 118 961 or ku.oc1750429420.fcl@1750429420nitsu1750429420a.sem1750429420aj1750429420.
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