The Bill will not gain Royal Assent before 22nd July. The Government aims to finish the House of Lords Report stage by summer recess with the final stages of the Bill, amendments debated between the Houses (known as ping pong) taking place in early autumn before moving to Royal Assent, presumably before party conferences.
With that slightly later timetable in mind the Government published an Implementation Roadmap on 1st July setting out its schedule for implementing the Employment Rights Bill (ERB). There is reassurance given that there will be a proper business readiness period for the changes following responses to consultations and a staged implementation plan.
Here are a selection of the key dates to note:
Consultations in late summer/autumn 2025 include day one rights to claim unfair dismissal and dismissal process in statutory probation period.
Consultations a little later in autumn 2025, likely to be October, include fire and rehire, regulation of umbrella companies, and ending exploitative zero hours contracts.
Winter/early 2026 collective redundancy changes and flexible working will be consulted on.
Three long awaited strategy documents were published in the last week of June 2025: Industrial Strategy, Infrastructure Strategy and Trade Strategy. These policies are all intended to get the economy moving, with significant capital investment in infrastructure, energy and professional services. The long-awaited Industrial Strategy focuses on eight critical sectors including advanced manufacturing, life sciences and tech. These are well aligned to APSCo member profiles and should deliver a welcome economic boost. We will be focusing on recruitment and its importance to these sectors over the next few months. However, understandably these strategies all have a considerable time lag before benefits are felt by business and workers.
Since Q2’s Policy Talk in April it has been a rollercoaster ride for recruiters with April’s NICs increases and the annual batch of Easter and Spring bank holidays resulting in a subdued Spring. Encouragingly June’s APSCo Bullhorn Recruitment Trends Report shows a healthy increase in month-on-month and year-on-year contract vacancies added in May of 4.4% and 10.8% respectively. There was also a healthy increase in year-on-year contract sales revenue showing strong fee values and better quality of placements, despite pressure on volumes.
In challenging economic conditions like those we find ourselves in, businesses and the public sector traditionally turn to more flexible labour sources, such as contractors, temps and consultants, while reducing their permanent spend. This helps them achieve a level of budgetary control over their projects and BAU. This is borne out in our Trends Report with permanent metrics across the board showing a slight increase month-on-month, but significantly down year-on-year.
We know that the “safe harbour” offered by contracting is threatened by the ERB, in particular the “guaranteed hours offer” sketched out in Schedule 1 of the Bill. The legislation has been debated in the House of Lords at ‘Committee Stage’ for over a month - much longer than expected.
This Bill continues to be very contentious with the Conservatives vowing to reverse it if they return to Government. Given the Bill’s importance to the professional recruitment sector, APSCo has been busy continuing to engage on the ERB. This has included a Ministerial meeting in May, along with continued engagement with senior Conservatives, including Shadow Chancellor, Sir Mel Stride’s office and Liberal Democrats across both Houses.
Members have provided their own insights to us on potential impact and we are urging members (and non-members) to write to their MPs – on behalf of their business and in a personal capacity - explaining their concerns about the impact of the ERB on their sector and local area. MPs need to know the strength of feeling on the potential inadvertent impacts the Bill may have on our sector. To help you here, we have drafted a pro forma letter for members to use. This is a very impactful campaigning method as all MPs are concerned about economic activity in their constituencies.
It’s critical that we all provide evidence on the anticipated costs to business of implementing the changes and what we are seeing already from the market in response – an increased interest in outsourcing internationally, self-employed and consultancy arrangements. The scope and scale of the guaranteed hour provisions are yet to be determined, so we must keep the pressure on.
HMRC and HMT provided us with more clarity on the umbrella company reforms and new joint strict liability rules being placed on recruiters and workforce solution providers (and umbrellas in limited circumstances) from April 2026. Following a series of member engagement event we explained recruiters’ position in a recent article in Contractor UK
As we’ve discussed the Employment Rights Bill Implementation Plan scopes out a number of consultations in the latter part of the year, which members are urged to reply to or participate in our responses.
The 10 year plan for the NHS is expected on 3rd July. Our healthcare sector quite rightly feels under pressure and vilified by the Health Minister in recent press, which led to us writing a letter to Wes Streeting. Hopefully the plan will finally enable financial resource to be released to primary care providers and healthcare in community settings to drive forward the DHSC’s agenda. This should provide an opportunity for the healthcare sector to diversify and increase their resilience.
Encouragingly, skills will return to the fore with a skills bill introduced in autumn. The Industrial Strategy confirmed that the reformed growth and skills levy will be rolled out from April 2026 with a strategy to pledge a pipeline of workers for the eight priority sectors. There will be funded non-apprenticeship courses together with the repeatedly delayed lifelong learning entitlement due to launch in January 2027. However, we need to keep the pressure on for flexible, modular training funded by the levy – something business has been calling for since 2016- alongside evolution of apprenticeships.
In conclusion, this will be the year of the Employment Rights Bill – with a swathe of consultations to be responded to as the year progresses. Our members report to us there is a disconnect between the impact of the ERB and the ambitions of the Industrial Strategy. We need to articulate that to Government, but to do that we need evidence of the problems and possible solutions. We need evidence from members on anticipated costs of implementation and running a contracting book post reform, current client awareness and their likely mitigation strategies and increased costs. We also need suggestions on what would work to deliver the Government’s policy to deliver good, secure work, whilst boosting participation in the labour market and skills. Recruiters and MSPs have an expert voice so lets use it!
Members can find the resources they need to run their businesses, educate their clients and join our policy work in our hub. For those looking to play a part please get in touch.