A Guide To Employment Law – What You Need To Know

Employment law has undergone significant change in recent years, with new rights for employees and additional responsibilities for employers. From flexible working and carers’ leave to neonatal care leave and the duty to prevent sexual harassment, employers must ensure their policies, procedures and training remain up to date.

This guide highlights some of the most important employment law developments and what they mean for your business.

Duty to Prevent Sexual Harassment in the Workplace

Since 26 October 2024, employers have been under a positive legal duty to take reasonable steps to prevent sexual harassment in the workplace.

Previously, employers were primarily expected to respond to complaints once they arose. The law now requires employers to take proactive steps to reduce the risk of sexual harassment occurring in the first place.

What are the consequences of non-compliance?

Where a sexual harassment claim succeeds, an Employment Tribunal may increase compensation by up to 25% if the employer is found to have breached its duty to take reasonable preventative steps.

The Equality and Human Rights Commission (EHRC) also has powers to investigate and take enforcement action against employers who fail to comply.

What are “reasonable steps”?

Reasonable steps will vary depending on the size and nature of the organisation but may include:

• Having a clear anti-harassment policy
• Providing regular training to employees and managers
• Explaining how complaints can be raised
• Supporting employees who witness harassment
• Investigating complaints promptly and fairly
• Carrying out workplace risk assessments
• Monitoring workplace culture
• Reviewing policies and training regularly

Employers should be able to demonstrate the practical steps they have taken to prevent harassment.

Paternity Leave Changes

Since March 2024, eligible employees have had greater flexibility when taking statutory paternity leave.

Employees can now:

• Take paternity leave as one two-week block or two separate one-week blocks
• Take leave at any time within 52 weeks of the child’s birth or placement for adoption
• Give shorter notice than was previously required
• Change planned leave dates with the required notice

These changes are designed to provide greater flexibility for working parents.

National Minimum Wage

National Minimum Wage and National Living Wage rates increased again in April 2026.

Current rates are:

Employers should ensure payroll systems are updated whenever annual rate increases take effect.

Failure to pay the correct minimum wage can result in penalties, repayment obligations and HMRC enforcement action.

National Minimum Wage and Family Household Workers

Since April 2024, certain workers living in their employer’s family home are entitled to receive the National Minimum Wage.

This applies where the individual:

• Lives in the employer’s family home
• Is not a member of that family
• Is treated as part of the household
• Does not pay for accommodation or meals

Employers who rely on domestic workers or live-in support should ensure they comply with minimum wage requirements.

Holiday Pay and Irregular-Hours Worker

Changes to holiday entitlement and holiday pay came into effect for leave years beginning on or after 1 April 2024.

The regulations introduced definitions for:

Irregular-Hours Workers

Workers whose paid hours are wholly or mostly variable from pay period to pay period.

Part-Year Workers

Workers who only work part of the year and have periods of at least one week during which they are not required to work and are not paid.

Holiday Accrual

Holiday entitlement accrues at 12.07% of hours worked during each pay period.

Rolled-Up Holiday Pay

Employers may use rolled-up holiday pay for eligible irregular-hours and part-year workers, provided it is clearly identified on payslips and calculated correctly.

Flexible Working Requests

Since April 2024:

• Employees can make a flexible working request from day one of employment
• Employees can make two requests during a 12-month period
• Employers must consult with employees before refusing a request
• Requests should generally be dealt with within two months

Flexible working arrangements may include:

• Home working
• Hybrid working
• Flexible hours
• Compressed hours
• Part-time arrangements

Employers should ensure their policies reflect the current rules.

Carer’s Leave

The Carer’s Leave Act introduced a new day-one employment right from April 2024.

Eligible employees may take:

Up to one week of unpaid leave in any rolling 12-month period

The leave is available where an employee is caring for, or arranging care for, a dependant with a long-term care need.

Employers can postpone leave where business operations would be significantly disrupted, but must explain the reasons and offer alternative dates.

Enhanced Redundancy Protection for New Parents

Since April 2024, additional redundancy protections apply to employees who have recently returned from:

• Maternity leave
• Adoption leave
• Eligible periods of shared parental leave

Where a redundancy situation arises, eligible employees may have priority access to suitable alternative vacancies.

Protection can extend for up to 18 months from the child’s birth or adoption placement.

Allocation of Tips and Service Charges

The Employment (Allocation of Tips) Act 2023 came into force on 1 October 2024.

Employers must:

• Pass 100% of qualifying tips and service charges to workers
• Distribute tips fairly and transparently
• Maintain a written tipping policy
• Keep records of tip allocation for at least three years

This legislation applies across the hospitality, leisure and service sectors.

Neonatal Care Leave and Pay

The Neonatal Care (Leave and Pay) Act came into force on 6 April 2025.

Eligible employees whose baby requires neonatal care may be entitled to:

• Up to 12 weeks of Neonatal Care Leave
• Statutory Neonatal Care Pay (subject to eligibility requirements)

This entitlement is in addition to maternity leave, paternity leave, adoption leave and shared parental leave.

Leave is available from day one of employment, although statutory pay requires qualifying service and earnings criteria to be met.

Employees taking neonatal care leave continue to benefit from their contractual terms and conditions (except remuneration) and have protection relating to their return to work.

What Employers Should Do Now

To remain compliant with current employment law, employers should:

• Review anti-harassment policies and training
• Update flexible working policies
• Ensure payroll systems reflect current minimum wage rates
• Review holiday pay calculations for irregular-hours workers
• Update family leave policies
• Introduce Neonatal Care Leave procedures
• Review redundancy procedures relating to new parents
• Train managers on recent legal developments

Frequently Asked Questions