Key employment law updates | February 2026

Welcome to our monthly update, where we share upcoming changes to employment law.

Government consults on strengthening tipping rules

From October 2026, the Employment Rights Act 2025 (ERA 2025) will require employers to consult with trade unions, elected representatives or workers when creating or reviewing their tips policy. Employers will need to review the tips policy once every year (and consult each time). The government has opened a consultation on these new requirements, which closes on 1 April 2026, and we encourage all employers who deal with tips to respond.

The consultation also seeks feedback on how the current statutory Code of Practice on fair and transparent distribution of tips, and the non‑statutory guidance are working in practice. It invites employers, workers and industry groups to identify gaps, suggest improvements, and shape how the new consultation requirements should be implemented.

This is a key opportunity for businesses to influence how the strengthened framework will operate ahead of changes expected to take effect in October 2026.

Fresh consultation opens on upcoming fire‑and‑rehire restrictions

The government has launched its first consultation on how the new "fire‑and‑rehire" restrictions, set out in ERA 2025, should operate in practice.

Once in force, ERA 2025 will make it automatically unfair to dismiss (or threaten to dismiss and replace) an employee in order to push through changes to key contractual terms. These protected terms, known as “restricted variations”, cover essential elements of the employment relationship that employers will no longer be able to alter through fire‑and‑rehire tactics.

The government's consultation seeks views on which types of benefits, allowances, expenses and shift patterns should benefit from these enhanced protections. The government is aiming to draw clear boundaries around what counts as a core contractual term for the purposes of the new rules.

With changes expected to follow in January 2027, this consultation gives employers an important chance to help shape how the new regime will work in practice.

The consultation closes on 1 April 2026.

Government consultation on the regulation of agency work and umbrella companies

The government's most recent consultation focusses on regulation of agency work and umbrella companies. Deadline for submissions is 1 May 2026. ERA 2025 will bring umbrella companies within the temporary labour market regulatory framework, meaning clearer rules, greater oversight and stronger enforcement.

The government's focus is on providing protection for workers, including increasing transparency relating to pay, contractual terms and employment rights, whilst also ensuring the temporary labour market drives economic growth.

The consultation seeks responses from workers, businesses and those in the temporary labour market. You can respond here. 

Good news for employers: annual levy to be removed from April 2026

The Certification Officer has confirmed that the statutory power requiring trade unions and employers’ organisations to pay an annual levy towards the regulator’s operating costs will be abolished from 1 April 2026. This change will take effect under section 85 of ERA 2025, although additional secondary legislation will be needed to formally implement the repeal.

Available training for managers

Given the significant changes due to be brought about by ERA 2025, there is no better time to upskill your managers via our transformational management development programmes to reduce risk, increase engagement, and enhance motivation.

Our programmes involve utilising unique accelerated learning techniques that will boost people management skills for years to come, suitable for supervisors up to board level. 

Furthermore, our seamless programmes link in with your policies and templates to bring about impactful change (with practical templates to bring your policies to life, if required). We link below further information on four of our flagship programmes:

Details of our current programmes are as follows:

• 21st Century: An innovative four-day management development programme designed to equip managers with essential skills, knowledge, and behaviours to effectively manage performance and improve workplace culture.
• Gender Diversity: We know that managers and employees lack confidence talking about gender diversity and managing a diverse workforce. That is why we've created this bespoke training programme to help you get ahead and shape your culture.
• Inclusive Leadership: We may not notice our unconscious biases, but they still influence our actions and beliefs. For leaders, it is crucial to recognise those biases and lead inclusively which is the focus of our one-day Inclusive Leadership programme.
• Prevention of Sexual Harassment: With a duty to take proactive steps to prevent sexual harassment (such as training) introduced last year, it is more important than ever to act. This programme equips your workforce with the tools needed to identify and take conscious steps to prevent workplace sexual harassment.
• Upskill Managers to Manage: We can support you to navigate the challenges of integrating teams effectively to maximise post-integration success, emphasising the need for strong management, strategic alignment, and collaboration to overcome cultural differences and mitigate risks in an increasingly competitive market.
• Improve Employee Heath & Resilience: Improving the health and wellbeing of your people is a key requirement to driving a successful business. By educating employees on health and wellbeing strategies, we can help you to gain the competitive edge as your people improve their energy, productivity and overall wellbeing. Our wellbeing programmes deliver educational, fun and interactive sessions that are empowering and revealing.

Please contact Joanne Boyle, Legal Director, if you would like to discuss further how we can support your organisation.