What does the UK government’s roadmap for implementing the Employment Rights Bill mean for internal audit?
2026 looks set to be a big year for employment law changes in the UK. The government promised employment rights reforms in its manifesto and has now published a roadmap to implementation giving more details about when changes will come into force. Internal audit teams would be wise to plan to work with HR and finance, as well as with third-party suppliers, including recruitment firms, to ensure that the correct policies are in place and identify any potential issues
The Employment Rights Bill has already been published, so its main provisions have been widely analysed. They include rights to parental leave and employment protections from day one in a job, changes to sick leave, a ban on “fire and rehire” practices and obligations for employers to “take all reasonable steps” to prevent sexual harassment of employees – including from third parties.
The bill has been criticised by employer groups like the CBI and Federation of Small Businesses, who warn it could lead to job cuts, reduced opportunities for some temporary staff, and added pressure on small firms to meet new flexibility requirements. However, it is popular with Labour MPs and unions (and, polls suggest, with many voters) so is expected to pass into law this year.
Deputy Prime Minister Angela Rayner promised that “these landmark reforms will kick in within months, demonstrating our commitment to making work pay for millions of workers across the country and delivering real change”. And Business Secretary Jonathan Reynolds stressed that the government has consulted widely with business. “Since the beginning, we have been working with businesses big and small to ensure this Bill works for them, and this roadmap will now give them the clarity and certainty they need to plan, invest and grow,” he said.
Timeline for changes
Internal audit teams should note that immediately after the bill becomes law there will be changes to rules over strikes (removing restrictions brought in in 2023) and laws regarding trade union rights (scrapping most of those introduced in the Trade Union Act 2016). There will also be instant protections to safeguard the jobs of employees who take industrial action.
Other changes will follow in April 2026. These include changes to redundancy payment rules, a right to paternity leave and unpaid parental leave from day one in a job, new whistleblowing protections, changes to sick pay provisions, and a package of trade union measures.
In October 2026, the obligations for employers to prevent sexual harassment of employees come into force, along with a ban on “unscrupulous fire and rehire” practices. Then in 2027 further protections against harassment will come into force, plus broader protections against unfair dismissal and dismissal of pregnant women and new mothers. Workers will gain rights to bereavement leave and flexible working and protection against “the exploitative use of” zero-hours contracts.
There is still uncertainty about what exactly “unscrupulous” and “exploitative” will mean in practice, but many of the provisions are clear and this roadmap to when they will come into force has been widely welcomed by business leaders. The broad range of measures means that many organisations will need to revise their employment policies and third-party contracts. Some IT systems may also need to be updated. Organisations may also need to revise risk assessments and consider how they communicate their expectations around sexual harassment and whistleblowing and how staff report wrongdoing.
Internal audit can support this work by offering advice, benchmarking activity against what is being done in comparable organisations and identifying areas that may create additional risks under the new act. Internal audit teams may also decide to undertake reviews or audits of areas including corporate culture, third-party risk and HR.