You Have Time to Fix Your People Problems - But Don't Waste It

Big changes are coming for UK businesses with the introduction of the Employment Rights Bill. And the ones that prepare properly will have a significant advantage.
Employment tribunal claims rose 23% last year. There are 45,000 open cases right now - a 32% increase on last year. The system is buckling under pressure. The heat is on employers to get people practices right and if they don't the commercial implications in terms of time and cost are significant. The Bill adds additional stress to businesses that are already finding it hard.
But here's the good news: the government has given you more time to prepare. The biggest change - day-one unfair dismissal rights - won't kick in until 2027.
The businesses that use this time to build proper people management systems will thrive. Those that don't will be at serious risk of costly claims and poor staff commitment.
You have time to get this right. But only if you start acting now.
The Numbers That Should Worry You
📈 Tribunal claims are exploding:
- Unfair dismissal: 22% of all claims
- Discrimination claims: 30% of total cases (up 15% in one quarter)
- Disability discrimination: up 28% in Q1 2025 alone
- Average unfair dismissal award: £13,749
💰 Immediate costs hitting now:
- National Insurance up from 13.8% to 15%
- Statutory sick pay rises to £118.75 per week
- New neonatal care leave: 12 weeks paid
- Fire and rehire failures: 25% compensation uplift (up to 112.5 days' pay)
These aren't just statistics. They're real costs hitting real businesses right now.
What Changes When (And Why It Matters)
The government is taking a phased approach, with three key implementation dates:
📅 April 2026:
- Statutory Sick Pay reforms
- Protective awards double (90 to 180 days for collective redundancy breaches)
- Fair Work Agency established
- Day-one paternity and parental leave rights
- Trade union balloting changes
📅 October 2026:
- Fire and rehire restrictions
- Enhanced sexual harassment prevention duties
- Third-party harassment liability
- Extended tribunal claim time limits
- Stronger union rights and tips laws
🚨 2027 - The Big One:
- Day-one unfair dismissal rights
Currently, employees need two years' service to claim unfair dismissal. From 2027, they can claim from day one. With unfair dismissal already representing 22% of all tribunal claims, expect this to explode.
The smart businesses are using this extended timeline to build proper people management systems, not just fixing immediate problems.
The People Problems You Need to Fix (But Now You Have Time to Do It Right)
🎯 Underperformers That team member who's been coasting for months? You don't need to panic, but you do need a plan. Use this time to implement proper performance management systems, not just quick fixes.
⏰ Attendance issues Persistent lateness or absence patterns? Build robust absence management procedures. You have time to do this properly, not reactively.
😤 Attitude problems Behavioural issues affecting the team? Address them systematically. Create clear behavioural expectations and consequences.
📝 Poor documentation If you can't prove your decisions were fair, you'll lose at tribunal. Use this extended timeline to build proper record-keeping systems.
This isn't about rushing to fire people. It's about building systems that prevent problems and manage them fairly when they arise.
Three Things You Should Start This Year
🔍 Build proper foundations Don't just patch problems - build systems. Review employment contracts, create comprehensive policies, and establish robust record-keeping. You have time to do this properly.
💪 Invest in manager development Train your managers in employment law basics, difficult conversations, and fair treatment principles. They're your first line of defence, and you now have time to develop their skills properly.
🎯 Create prevention systems Rather than just fixing current issues, build systems that prevent problems. Regular employee feedback, clear communication processes, and proactive performance management.
The Business Case (It's Not Just About Compliance)
Getting people management right isn't just about avoiding tribunals. Committed employees deliver:
- 21% higher profitability
- 10% increase in customer satisfaction
- 20% increase in sales
Poor people practices cost you:
- Management time lost to tribunal proceedings (average 4.8 weeks per claim)
- Reputational damage
- High turnover costs
- Reduced productivity from everyone else
The Reality Check
The employment law landscape is changing, but you have more time than originally thought to prepare properly.
Day-one unfair dismissal rights don't come in until 2027. But don't waste this opportunity. The businesses that use this time wisely will have a significant competitive advantage.
This isn't just about compliance. It's about building businesses that can attract, retain and motivate great people. The businesses that will succeed are those that see these changes as an opportunity to professionalise their people practices.
You have time to get this right. But only if you start building proper systems now, not waiting until 2026 to panic.
The question isn't whether you can afford to invest in better people management. It's whether you can afford not to.
While others wait until the last minute, smart businesses are already building the people practices that will give them competitive advantage in the new employment landscape.
Don't waste the extra time you've been given.
Need help building robust people management systems? The businesses that start now will be way ahead of those that wait until the last minute.
Need help preparing for the changes ahead? The businesses that act now will have a significant advantage over those that wait until 2026.




