On 18 December 2025, The Employment Rights Bill received Royal Assent and became law as the Employment Rights Act 2025. These reforms will affect how employers manage contracts, pay, dismissal processes and employee requests.  

While the Autumn Budget 2025 did not introduce new employment rights, it reinforced cost pressures facing employers, including wage increases and payroll considerations. Together, these developments make early preparation essential. 

At Glaisyers ETL, our Employment team supports SMEs across the North West with clear, practical legal advice to help them stay compliant and confident as the law changes.

Key Employment Law Changes Taking Effect from 2026

Holiday Pay and Working Time

Reforms are expected to simplify holiday pay calculations, particularly for employees with irregular or variable hours. Employers must continue to ensure holiday pay reflects normal remuneration, an area that frequently gives rise to tribunal claims. 

Employers should review payroll practices and update holiday policies accordingly.

Paternity Leave and Unpaid Parental Leave Time

From April 2026, paternity leave and ordinary unpaid parental leave will become day-one rights. This removes existing service requirements and will require updates to family leave policies and onboarding processes.

Statutory Sick Pay

Changes to statutory sick pay (SSP) will expand eligibility:

SSP payable from the first day of sickness Removal of the lower earnings limit 

These reforms, expected from April 2026, are likely to increase costs for employers and will require updates to sickness absence policies and payroll systems.

Ordinary Unfair Dismissal  

The qualifying period for ordinary unfair dismissal claims will be reduced from two years to six months’ service, with changes expected from January 2027. 

Employers will need to follow fair procedures and have one of the statutory potentially fair reasons for dismissal from a much earlier stage of employment and ensure disciplinary and performance management processes are robust. 

Zero-Hours Contract  

Workers on zero-hours contracts will gain the right to request guaranteed working hours after a reference period, likely around 12 weeks. Employers will also be required to provide reasonable notice of shifts and compensate workers for short-notice cancellations. 

These changes are expected to take effect in 2027 and will require improved record-keeping and scheduling systems. 

Flexible Working  

Flexible working rights will be made more of a “default” position with reference to: 

Strengthening the day-one right to request flexible working A requirement for employers to provide written reasons for refusals 

Failure to follow the correct process could result in compensation of up to eight weeks’ pay. Employers should ensure managers are trained to deal with requests fairly and consistently. 

Preparing Your Business for Employment Law Changes in 2026

To stay compliant, employers should: 

Review employment contracts and eligibility thresholds Update staff handbooks and HR policies Train managers on new rights and procedures Audit payroll and HR systems 

Early action will reduce risk and help businesses adapt smoothly.

How Glaisyers ETL Can Help

The Employment team at Glaisyers ETL provides practical, commercially focused advice to help SMEs navigate employment law reform. We offer Employment Law compliance audits, reviewing contracts, policies and procedures to ensure your business is ready for the changes ahead. 

Book an Employment Law compliance audit with Glaisyers ETL today. 

Staying on top of changes to Inheritance Tax (IHT) is a crucial component of effective wealth preservation, particularly in light of the UK Government’s reforms over the past year.  

At Glaisyers ETL, we provide guidance on all aspects of IHT legislation, helping you plan your wealth so it’s protected and passed on as intended.

What’s changing  from 2026?

The Autumn Budget brought several important developments that will significantly affect IHT planning for individuals, families, and business owners.

Agricultural and Business Property Relief Reforms

Last Autumn’s budget proposed a £1 million limit on relief for agricultural and business property. After much campaigning from affected groups, the limit was increased to £2.5 million per individual. Regardless of this increase, the limit represents a significant overhaul from current regulations, as qualifying business and agricultural assets currently receive 100% relief from IHT; this will change from 6 April 2026.  

The November 2025 budget softened regulations around this cap, meaning that from 6 April 2026, any unused portion of the £2.5 million allowance can be transferred between spouses or civil partners. Even if one spouse died before the changes take effect, their unused allowance can still be applied, allowing a surviving spouse’s estate to benefit from up to £5 million of qualifying relief.

Importantly, this transfer applies only after both spouses have passed and only if the first spouse did not fully use their allowance. It is a transfer between estates, not something the surviving spouse can claim while their partner is still alive.

Continued freeze on Inheritance Tax thresholds

The Budget also confirmed the planned freeze on IHT nil-rate bands at £325,000 has been extended by a further year to April 2031. This extra year of frozen thresholds means more estates will become liable for IHT in the coming years as asset values continue to rise.

Reducing your Inheritance Tax

Effective Inheritance Tax planning means starting early, seeking tailored advice, and regular reviewing. Two of the most used strategies are lifetime gifting and trust planning.  

Lifetime Gifting

Lifetime gifting can be an effective way to reduce the value of your taxable estate by transferring money or assets to a beneficiary while you are alive. Gifts made to children or friends are classed as Potentially Exempt Transfers (PETs), if you survive for 7+ years after the date it is given then it won’t count towards your estate for IHT purposes.

Gifts to a spouse or civil partner are usually fully exempt from IHT, regardless of how long you survive.  

Trust Structures

Trusts work by removing assets from your personal estate during your lifetime. Once in a trust, these assets legally belong to the trustees, which can potentially reduce the value of your personal estate.

There are many types of trust, and finding the right one for you can be a complex process. The Private Client team at Glaisyers ETL can help simplify your decision and offer expert advice on which trust will be most beneficial for you.  

Common Inheritance Tax Misconceptions 

There are some common misconceptions around IHT that, if not addressed, can lead beneficiaries to receive far less than they expected.

IHT Only Affects the ‘Super Rich’ 

Due to frozen tax-free thresholds and rising asset values, more people than ever are finding their estates liable for IHT. 

Once I Give an Asset Away, It Is Outside of My Estate  

Gifts where the donor continues to benefit (such as a house in which they live rent-free) are considered ‘Gifts with Reservation of Benefit’. This means that the assets remain part of the donor’s taxable estate, even though legal ownership has passed to someone else. 

Overseas Assets Are Not Subject to UK Inheritance Tax 

If you are a UK-domiciled individual, your entire estate – including assets abroad – will still potentially be subject to UK IHT, including foreign property, investments, and bank accounts.  

Recent rule changes mean that an individual’s UK domicile status can now be influenced by the number of years they have lived in or outside the UK. Anyone who has lived, or plans to live, abroad should ensure they understand these new rules and how they may affect their estate planning. 

Inheritance Tax Planning is a One-Time Event 

As tax laws, asset values, and personal circumstances change over time, IHT planning should be reviewed regularly to ensure wills and strategies remain effective and compliant.

Let us help you protect and preserve your wealth for generations to come.

Take proactive steps to secure your family’s financial future. Contact our Private Client team today to schedule your confidential consultation and receive tailored guidance on how changing IHT rules could impact you. 

For the HR Department, the start of the year can feel like the alarm you forgot to cancel on a Sunday: while others get to stay in bed and stretch, your year starts with a sudden and most unwelcome wake-up call. New budgets, restructures, policy rollouts, and legislative changes can make January a high-risk period for HR errors, and the cost of falling short can be monumental, with the potential to result in tribunal claims, employee relations issues, and even reputational damage.  

At Glaisyers ETL, we help employers anticipate and prevent costly HR mistakes, ensuring compliance from the start of the year. Here, we’ll highlight the most common pitfalls to look out for and how you can avoid them so that you can start the year off on the right foot.

Stale Documentation

Employment contracts and handbooks – if not used as a coaster or a doorstop – are often left untouched for years, despite updates to laws, business structures, or working practices. This kind of outdated documentation can create confusion, undermine enforceability, and expose employers to unnecessary risks. Regular contract and employee handbook reviews help to ensure terms remain legally compliant and aligned with how the business actually operates.

HR teams also handle significant volumes of sensitive personal data. Weak data protection can lead to GDPR breaches, regulatory fines, and loss of employee trust. Implementing robust processes, clear accountability, and comprehensive staff training is essential.

Managing Working Hours, Pay, and Holiday Compliance

Employers must carefully monitor working hours, rest breaks, and opt-out arrangements to ensure not only that the organisation is compliant, but also that treatment is fair across all staff members. Holiday pay also remains a high-risk area, particularly where employees receive overtime, commission, or variable pay. HR teams should implement robust time-tracking systems, conduct regular audits of holiday pay calculations, and provide comprehensive training to line managers on their legal obligations to help reduce errors and maintain consistent treatment across the organisation.

Avoiding Discrimination and Promoting Equality in HR

Though it may not be purposeful, unconscious bias can influence recruitment, promotion, performance management, and redundancy decisions. Without adequate training and structured processes in place, these risks can expose employers to discrimination claims. Additionally, a homogeneous team does not generate new ideas – diversity should be prioritised for companies seeking to expand their horizons and thrive. It should also be noted that employers have a legal duty to make reasonable adjustments for disabled employees, and failure to do so could equally land your organisation in hot water and result in reputational damage.

Managing Performance and Redundancies Lawfully

Performance management and redundancy exercises must be handled through fair, transparent processes supported by clear documentation. Informality or poor record-keeping significantly weakens an employer’s position in the event of a dispute or termination of employment. You can find information on navigating settlement agreements on our website or contact a member of our employment team for quick, personalised advice.  

Proactive HR management is exigent year-round, but the start of the year can open more opportunities for error than usual. SMEs, in particular, often face additional challenges due to limited HR resources or reliance on informal practices. Legal and HR compliance should be seen as an investment, not a burden. An HR audit reviews contracts, policies, procedures, and practical application to assess legal compliance and operational effectiveness. A strong compliance framework supports growth, investment, and organisational change.

Ensure your HR policies and practices are compliant for 2026.

Book an HR compliance consultation or policy review with Glaisyers ETL today to protect your organisation and start the year with confidence.

A Settlement Agreement is a legally binding contract between an employer and an employee that solidifies the terms under which a dispute or employment relationship is terminated. By signing, the employee waives their legal rights to bring employment claims against their employer in the future, in exchange for a financial payment or other agreed benefits. Once signed, the agreement becomes enforceable, which is why it is recommended (and in the case of employees, a requirement) for both parties to obtain independent legal advice before it is finalised. 

Understand What Claims You’re Waiving

If you’ve received a settlement agreement to sign, you’re likely coming to the end of your employment. While it might be tempting to get what can be a difficult situation over and done with, you have rights, potentially some bargaining power, and the legal entitlement to independent advice usually funded (or at least contributed to) by the employer, which you need to exercise to ensure you understand the terms and effect of the settlement agreement. By signing the agreement, you give up the ability to bring claims such as unfair dismissal, discrimination, or breach of contract. It’s crucial, therefore, to make sure you understand whether you may have grounds for a claim and the implications of signing a settlement agreement on your legal rights.   

The settlement agreement needs to identify to the particular claims you are waiving. Some rights are commonly excluded from the waiver, for example certain personal injury claims and pension rights. It is therefore imperative to have a solicitor assess the contract before even considering signing it to ensure you understand what rights you are “signing away”. 

Assess Your Proposed Benefits Carefully

These benefits may come in the form of payment in lieu of notice, holiday pay, bonus or commission, ex gratia compensation, or redundancy pay. Employees may be able to negotiate for a higher figure in some of these areas, especially if the tax position is such to bring down the total settlement value. Ex gratia payments are generally tax-free up to £30,000, but contractual or statutory payments such as notice pay and bonuses are taxable through PAYE. They will therefore have tax and National Insurance contributions deducted. Make sure you are aware which payments are taxable and tax free under the agreement so you can consider whether it’s a fair amount for what you’re sacrificing.

Confidentiality and Restrictive Covenants

Many employees don’t realise they may already be bound by restrictive covenants (non-compete, non-solicitation), and what settlement agreements often do is simply reinforce your existing contractual obligations. However, settlement agreements can sometimes seek to extend the timescales for these restrictions or seek to introduce new ones. For example, an employee who signed an employment contract years ago with a six-month non-compete clause might find that their settlement agreement extends this restriction to 12 months and adds a non-solicitation clause preventing them from approaching former clients. This could significantly impact your future job prospects, and additional compensation should therefore be offered in accordance. With a breadth of experience in handling deals like this, Glaisyers ETL can help you assess whether the restrictions are fair, enforceable, or negotiable, potentially future proofing your career. 

Take Your Time

Employees must not feel pressured, threatened, or rushed when signing a settlement agreement. Behaviour of this sort from an employer can potentially render the entire agreement invalid. If your settlement agreement has followed a pre-termination discussion/protected conversation, ACAS guidance states that you should have a period of 10 days to obtain legal advice on a settlement agreement. You should seek support if at any point you feel that you are being pressured into signing a settlement agreement prematurely or under duress.

Check List 

Here are a few items to consider when reviewing your settlement agreement for the first time.  

Have I checked every payment I’m owed? 

Do I understand what legal claims I am giving up? 

Are there any restrictive covenants limiting future job options? 

Have I been given enough time to consider the offer? 

Have I taken independent legal advice (paid for by my employer)? 

How Glaisyers ETL Supports Employees

With extensive experience supporting employees across Manchester and the Northwest, we provide settlement agreement advice and can help you to negotiate deals and challenge unfair or oppressive terms. You can expect quick, clear, and jargon-free guidance to help you through the process from start to finish. 

Speak to our employment law specialists today to protect your rights and secure the best possible outcome.