Legal update
Employment Rights Act 2025 update
Further to our previous update on the planned implementation roadmap for the Employment Rights Act 2025 (the ERA) (see here), we bring you the latest updates on the evolving implementation of the ERA.
Equality action plans
The ERA will require employers with 250 or more employees to produce equality action plans setting out the steps they are taking to address the gender pay gap and how they are supporting employees going through menopause. These will be introduced on a voluntary basis from April 2026 and will become compulsory in spring 2027.
On 4 March 2026, the Government published new guidance for employers to support them in taking effective action to improve workplace gender equality (see here and here).
The guidance outlines that employers must choose at least one ‘action’ that addresses their gender pay gap and one ‘action’ that supports employees going through menopause as part of their action plan. The list of actions can be found here, which broadly fall under the following categories:
- recruiting staff;
- developing and promoting staff;
- building diversity into the organisation;
- increasing transparency; and / or
- supporting women with health conditions and menopause.
Each recommended action has its own separate guidance document. Additional guidance will be published in April 2026.
Practical takeaway: Employers with more than 250 employees should review the Government’s new guidance and begin to introduce action plans on gender equality on a voluntary basis, in preparation for the mandatory requirements that will take effect in 2027. Northridge will continue to provide relevant updates as further guidance is released.
Collective redundancy
On 26 February 2026, the Government launched a new consultation on what the threshold to trigger collective consultation obligations should be, which is open until 21 May 2026.
Current position
The current legal position is that an employer must launch a collective consultation when they propose to make 20 or more redundancies within a 90-day period at one ‘establishment’.
However, different sites, stores and warehouses are normally treated as different ‘establishments’, meaning that there are often situations where large numbers of employees at an organisation are not being consulted because the redundancies are spread across multiple sites below the current threshold.
New approach
The ERA instead introduces an additional alternative threshold, which will be based on the total number of redundancies across the whole business. The current consultation is to determine what this threshold should be.
The Government’s preferred option is for a single fixed number between 250 and 1000 redundancies across the business as a whole, but they are also considering an alternative tiered approach where the threshold would vary depending on employer size (for example, 250 redundancies for organisations with fewer than 2500 employees, 500 redundancies for organisations with more than 250 but less than 10,000 employees, and so on).
