Welcome to this month’s edition of Worked Up – your one-stop shop for the latest updates in employment and immigration law.

In our first edition of the year, we’re giving you a preview of what to expect in 2025 – a potentially very big year in terms of employment and immigration law developments. In this month’s edition, we scan the Employment Rights Bill horizon and set out some of the new reforms due to be implemented in 2025 and 2026, explore the introduction of the new Equality (Race & Disability) Bill, along with the implementation of the Neonatal Care (Leave and Pay) Act 2023, which aim to address pay gap and family support issues. Lastly, we’ll provide an overview of key UK immigration changes that we expect to see in 2025.

If you would like to discuss any of the below updates, please do get in touch. Alternatively, if you would like to receive these updates directly to your inbox, please subscribe here.

The Employment Rights Bill: the past, the present and the future

Closing pay gaps and supporting families: more to come from Labour in 2025

Key UK Immigration Changes in 2025

If you want to stay ahead of the curve and keep updated on the key employment and immigration changes (including proposed legislation, consultations and case law) on the horizon over the next 24 months, check out our “What’s on the horizon” tracker.

Worked Up regulars will be well aware of the government’s much-touted Employment Rights Bill (“ERB”) by now, particularly as we’ve been covering the ERB since the draft was first published back in October last year.

For those in need of a refresher following the New Year festivities, some of the main (non-exhaustive) changes that the ERB is proposing to bring include:

• Unfair dismissal protection is set to become a “day one” right from the first day of employment, removing the two-year qualifying period. Subject to consultation, a “lighter touch and less onerous process” is likely to be permitted for the first 9 months of employment, save for in redundancy cases.
• Unpaid parental leave and statutory paternity leave will also become a day-one right.
• The lower earnings threshold and the three-day waiting period for statutory sick pay will be removed (we expect to see this one introduced fairly quickly).
• Greater protections for employees wanting to work flexibly, with employers being required to provide reasonable grounds when refusing flexible working requests.
• The threshold of 20 or more redundancies in 90 days to trigger collective consultation obligations will apply across an entire business, not just one establishment.
• Firing and re-hiring will become (potentially much) more difficult, as it will become automatically unfair to dismiss employees for refusing contract changes (with only limited exceptions for financial necessity where proper consultation has been carried out). This is in addition to changes that have just come into force (as of 20 January 2025) which grant employment tribunals the power to apply an uplift to protective awards by up to 25% where employers unreasonably fail to meet their collective consultation obligations or the requirements of the ACAS Code of Practice on dismissal and re-engagement.
• The recently introduced (October 2024) new sexual harassment regulations will extend the preventative duty so that employers will need to take “all reasonable steps” to prevent sexual harassment in the workplace rather than just “reasonable steps”. Further changes are also expected in this area, with the plan to deem sexual harassment complaints as ‘protected disclosures’ which will qualify them for protection under whistleblowing legislation and bringing back employer vicarious liability for third-party harassment.

Nothing is yet in force and many of the proposed changes are already subject to consultation, with further consultations likely to take place over the next 12 months (we’d expect, for example, for there to be extensive consultation on the collective-redundancy framework, flexible working rights and the proposed changes to unfair dismissal laws). The changes will be significant for all industries, but we expect the impact will be particularly substantial for businesses that regularly use freelance talent (such as Film and TV as well as other media businesses), given the likely introduction of a whole host of new rights and protections for such workers.

The ERB will also of course need to pass through Parliament. Labour have enough of a majority to achieve that relatively unscathed, but we would still expect to see some amendments to the proposals before the ERB is passed into law.

It is anticipated that the ERB will be approved no earlier than this summer, although many of the reforms are expected to take effect in Autumn 2026. This should give employers plenty of time to consider whether their employment structures remain fit for purpose and amend their policies, procedures and paperwork where necessary. We will, of course, report on these upcoming consultations and the ERB as it advances through Parliament. Our helpful horizon tracker will also be covering what employment law updates should be on your agenda in 2025.

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Announced in the King’s Speech 2024, the draft Equality (Race and Disability) Bill aims to fulfil Labour’s manifesto promise to “enshrine the full right to equal pay in law” for ethnic minorities and disabled people.

The Bill seeks to tackle inequality by: 1) introducing a statutory right to equal pay for ethnic minorities and disabled people, making it easier to challenge pay disparities due to ethnicity or disability; and 2) requiring employers with over 250 employees to report on their ethnicity and disability pay gaps, encouraging employers to address the reasons behind these disparities. The government also plans to create a new regulatory unit to enforce equal pay.

Additionally, the Neonatal Care (Leave and Pay) Act 2023 received Royal Assent in May 2023 and will come into effect on 6 April 2025. The Act will introduce statutory neonatal leave and pay for up to 12 weeks for parents of babies up to 28 days old who have a continuous stay in hospital of 7 full days or longer, which must be taken within 68 weeks of birth. These measures will be on top of any other leave parents may be entitled to, including maternity and paternity leave.

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The UK’s immigration system is currently in the process of undergoing significant reform, focusing on modernisation, security, and enforcement. For businesses sponsoring foreign workers and individuals visiting the UK, understanding these changes is critical to ensuring compliance and avoiding penalties.

eVisas

The UK is transitioning to a fully digitalised immigration system, phasing out physical documents like Biometric Residence Permits (“BRPs”) and Biometric Residence Cards (“BRCs”). While BRPs and BRCs, which expired on 31 December 2024, will remain valid for travel until 31 March 2025, individuals must apply for an eVisa as soon as possible.

The eVisa provides an online record of immigration status, streamlining processes for travel and verification. Applicants can apply via the UKVI app or website, linking their eVisa to their passport. It’s essential to ensure all personal details and documents are up to date in the UKVI system to prevent travel disruption.

Businesses should ensure that all migrant workers (not just those sponsored by the business) holding physical documents transition to eVisas promptly.

Expanded entry requirements for visitors

The Electronic Travel Authorisation (“ETA”) scheme, introduced in late 2024, will be mandatory for non‑visa nationals visiting the UK by April 2025. Similar to the US ESTA system, the ETA costs £9 and is valid for two years.

As of 8 January 2025, nationals of the USA, Canada, Australia, and Japan have been required to have an ETA to enter the UK.

From 2 April 2025, EU/EEA nationals and Swiss citizens will also require ETAs.

Businesses hosting international visitors should account for this added step when planning travel.

Stricter Compliance for Sponsors

The government is increasing enforcement against non-compliant sponsors. Changes include:

• Introduction of longer action plans: Sponsors committing minor breaches may face 12‑month action plans instead of the current 3 months, extending restrictions on recruiting foreign workers for non-compliant sponsors.
• Tougher penalties: Licence revocations will now result in a 2 year ‘cooling-off’ period for repeated breaches, double the previous 12-month period of restriction.

Furthermore, as of 31 December 2024, sponsors can no longer pass certain sponsorship costs to Skilled Workers under the Skilled Worker visa route. Instead, sponsors must bear costs such as sponsor licence fees (including administrative costs) and Certificates of Sponsorship fees. There is already an existing prohibition which prevents sponsors from passing on the Immigration Skills Charge to workers. These costs are substantial, particularly for businesses sponsoring multiple workers. However, sponsors can still recoup other immigration-related expenses, like application fees and Immigration Health Surcharge fees.

The changes aim to address allegations of worker exploitation and apply initially to the Skilled Worker route, with plans to extend this prohibition to other routes. Non-compliance, such as passing prohibited costs to workers, can lead to sponsor licence revocation.

We expect businesses will need help navigating these changes, particularly on workstreams such as drafting compliant clawback policies, reviewing employment contracts, and advising on sponsorship obligations.

Navigating the changes

As the UK tightens its immigration framework, preparation is crucial. Businesses must review their policies, update contracts, and budget for additional compliance costs. Meanwhile, individuals should apply for ETAs or eVisas well in advance of travel to ensure smooth entry.

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