17/01/2025
With 2024 well and truly behind us, we take a look forward to see what you can expect in the employment sphere during 2025. Please see our previous edition of Employment Eye for a summary of the key legislative changes over the last 12 months.
January
Dismissal and Re-engagement
The Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment of Schedule A2) Order 2024 is due to come into force on 20 January. This Order gives Employment Tribunals the power to increase or reduce any protective award by up to 25% for unreasonable failure to follow the statutory Code of Practice on Dismissal and Re-engagement (the Code) in collective consultation cases.
The Code was introduced by the Conservative Government in July 2024, it will remain in force until the Labour Government strengthen its provisions, which it has promised to do.
April
April statutory increases
| Payment | From | To | Date |
| National Living Wage - 21+ years | £11.44 | £12.21 | 1 April |
| National Living Wage - 18-20 years | £8.60 | £10.00 | 1 April |
| National Living Wage - under 18s | £6.40 | £7.55 | 1 April |
| National Living Wage - apprentices | £6.40 | £7.55 | 1 April |
| Employer NlCs | 13.8% | 15% | 6 April |
| Statutory Sick Pay | £116.75 | £118.75 | April |
| Other family leave payments* | £184.03 | £187.18 | April |
*Such as statutory maternity and paternity pay
The qualifying thresholds for family leave payments will increase from £123 to £125 per week, with the exception of maternity allowance which will remain at £30 per week.
Other rates and limits increases (e.g. the statutory cap on a week’s pay used for calculating payments such as the basic award for unfair dismissal and statutory redundancy pay) will take effect in April 2025 and are likely to be announced in early 2025.
Neonatal Care (Leave and Pay) Act 2023
Although the Labour Government has not formally confirmed when the Neonatal Care (Leave and Pay) Act 2023 will come into force, the HMRC has published its guidance, which indicates that the legislation is still likely to take effect. It is expected to come into force in April 2025. This legislation introduces the right to statutory neonatal leave and pay for up to 12 weeks for parents of babies requiring neonatal care (in addition to other family related leave). The leave must be taken within 68 weeks of birth.
September
On 1 September, the Economic Crime and Corporate Transparency Act 2023 provisions relating to the prevention of fraud comes into force. The Act applies to large employers (with 250+ employees) with more than £36 million turnover and £18 million in assets. Whilst this is not strictly “employment law” the provisions may have a knock on effect for some employment policies (e.g. whistleblowing and disciplinary), as the Act includes a new corporate criminal offence of ‘failure to prevent fraud’.
Sometime in 2025
Employment Rights Bill
Despite the fact that many of the reforms will not take effect until 2026, the Employment Rights Bill (the Bill) will feature heavily in 2025. The Government kicked off its series of consultations in 2024, when it launched four consultations relating to:
- Zero hours contracts
- Collective consultation and fire and re-hire
- Statutory sick pay
- Trade union activities
The above consultations closed in December 2024 and we are yet to hear of the outcomes - for further details about these consultations please see our Spotlight article. The Government has also promised further consultations during 2025 (as highlighted in its ‘Next Steps to Make Work Pay’ policy paper (published alongside the Bill)) relating to:
- Electronic balloting
- Modifying the test for a fair dismissal during the statutory probationary period (ie ‘initial period of employment’)
- The steps required in order to comply with the requirement to consult before rejecting a flexible working application
We have reported extensively on the proposed changes highlighted in the Bill. Should you wish to remind yourselves of the proposed changes please see Employment Eye from October 2024 as well as the Spotlight article highlighting the Government’s amendments to the Bill (published in November 2024).
The Bill is currently passing through the House of Commons and is at the report stage, bringing it one step closer to becoming law. We will of course report on any developments as they emerge.
Equality (Race and Disability) Bill 2024
This draft Bill will be published sometime in 2025, and whilst we are unsure of the precise content, the King's Speech and background briefing notes indicated that it would include:
- Equal pay (ethnicity and disability) - to extend equal pay protections beyond sex
- Ethnicity and disability pay reporting - to introduce mandatory ethnicity and disability pay reporting for larger employers (those with 250+ employees)
- Outsourcing – to ensure that outsourcing of services can no longer be used by employers to avoid paying equal pay
- Enforcement – to implement a regulatory and enforcement unit for equal pay (with input from trade unions)
The Paternity Leave (Bereavement) Act 2024
The Paternity Leave (Bereavement) Act 2024 received Royal Assent in May 2024, the Act will need supporting regulations before it can be brought into force (yet to be published), but once implemented, it will remove the 26 week minimum service requirement for fathers and partners to take paternity leave in cases where a mother, or a person with whom a child is placed or expected to be placed for adoption, dies.
Victims and Prisoners Act 2024
The Victims and Prisoners Act 2024 received Royal Assent in May 2024, it will be brought into force by regulations and we expect further details to be published sometime in 2025. When it takes effect, it will make provisions in non-disclosure agreements (including settlement agreements) preventing victims of crime from disclosing certain information unenforceable. A "victim" is defined as a person who has suffered harm as a direct result of being subjected to, or of specified circumstances relating to, criminal conduct.
There are also various cases to watch out for in 2025, which include issues relating to:
Philosophical beliefs
University of Bristol v Miller: whether an Employment Tribunal was correct to hold that an academic’s anti-Zionist beliefs qualified was a protected philosophical belief.
Less favourable treatment
Augustine v Data Cars Ltd: whether a worker’s part-time status must be the ‘sole reason’ for the less favourable treatment.
Whistleblowing
Sullivan v Isle of Wight Council: whether the Employment Appeal Tribunal was correct to hold that an external job applicant did not fall within the extended definition of ‘worker’.
Barton Turns Developments Ltd v Treadwell: whether an Employment Appeal Tribunal was correct to hold that employers can be vicariously liable for the act of a co-worker for the ‘detriment of dismissal’.
Employers should keep a close eye on the plethora of developments that are store this year, paying particular attention to implementation dates, as risk assessments and strategic planning may be necessary. We will of course keep you updated! However, if you would like further information on any of the topics discussed in this article, please contact a member of the Employment, Pensions & Immigration department who will be happy to help.
