Jun 5
The Employment Rights Act 2025 received Royal Assent on 18 December 2025, and several important employment and payroll changes are now in force. The first major April 2026 changes include day-one Statutory Sick Pay, removal of the lower earnings limit for SSP, new National Minimum Wage and National Living Wage rates, increased statutory family pay rates, day-one paternity and unpaid parental leave rights in Great Britain, and new annual leave record-keeping duties for GB employers.
These are not all UK-wide in the same way. Some changes apply across the UK, including Northern Ireland. Others apply only in Great Britain because employment law is largely devolved in Northern Ireland.
This article is a practical checklist for employers in Northern Ireland and Great Britain. It sets out what has changed, what applies where, what is coming next, and what to check before your next pay run.
The Employment Rights Act 2025 is being introduced in stages. Some measures are already in force, while others are scheduled for later in 2026 and 2027.
| Date | What changed or is due to change | Applies to |
|---|---|---|
| 1 April 2026 | National Minimum Wage and National Living Wage rate increases | UK-wide, including NI |
| 5 and 6 April 2026 | Statutory family pay increases to £194.32 per week | UK-wide, including NI |
| 6 April 2026 | SSP reforms: day-one entitlement, no lower earnings limit, new weekly rate | UK-wide, including NI |
| 6 April 2026 | Paternity leave and unpaid parental leave become day-one rights | GB only |
| 6 April 2026 | Annual leave and holiday pay record-keeping duty | GB only |
| 6 April 2026 | Collective redundancy protective award maximum increased | GB only |
| 6 April 2026 | Sexual harassment disclosures explicitly covered by whistleblowing law | GB only |
| 6 April 2026 | Tribunal compensation limits updated | GB and NI, with different figures |
| 6 April 2026 | Paid miscarriage leave | NI only |
| 7 April 2026 | Fair Work Agency established | GB only |
| 1 January 2027 | Unfair dismissal qualifying period reduces to 6 months | GB only |
| 2027 | Guaranteed hours rules for zero-hours and low-hours workers | GB, subject to further detail |
| 2027 | Wider bereavement leave, including pregnancy loss before 24 weeks | GB, expected unpaid |
| Future date | Northern Ireland Good Jobs Bill reforms | NI, not yet enacted |
For NI employers, the key point is that many Employment Rights Act 2025 changes do not automatically apply. Northern Ireland is expected to introduce its own reforms through the Good Jobs Bill, but that Bill has not yet been enacted. However, UK-wide rate changes, including SSP, NMW, NLW and statutory family pay, still matter for NI payroll.
Our pieces on HMRC PAYE issues and salary sacrifice pension changes cover the related payroll compliance picture, and our piece on how tax accountants help small businesses covers the wider compliance burden on SME payroll teams.
The new minimum wage rates apply from 1 April 2026 across the UK, including Northern Ireland.
| Category | Rate from 1 April 2026 | Previous rate |
|---|---|---|
| National Living Wage, 21 and over | £12.71 per hour | £12.21 |
| 18 to 20 year olds | £10.85 per hour | £10.00 |
| 16 to 17 year olds | £8.00 per hour | £7.55 |
| Apprentice rate | £8.00 per hour | £7.55 |
| Accommodation offset | £11.10 per day | £10.66 |
The payroll checks to run are straightforward but important.
Confirm every worker is in the correct age band, especially where birthdays have moved them into a new rate. Check that deductions, uniform costs, salary sacrifice or benefit arrangements do not bring pay below the applicable NMW floor. Review annualised hours and salaried-hours arrangements carefully, because underpayment can arise even where headline annual pay looks compliant.
If you use agency workers or labour providers, check the contractual and practical position. Responsibility can depend on the arrangement, but you should not assume that outsourcing labour removes all risk from your business.
Our piece on the key financial KPIs every SME owner should be monitoring monthly covers wage cost as a key metric, and how management accounts help SME owners explains how better reporting supports compliance.
The SSP changes from 6 April 2026 apply UK-wide, including Northern Ireland.
SSP is now payable from the first qualifying day of sickness absence, rather than after 3 waiting days. The lower earnings limit has also been removed, so employees no longer need to earn a minimum weekly amount to qualify, provided they meet the other SSP conditions.
The weekly rate from 6 April 2026 is the lower of:
This is particularly important for lower-paid and low-hours employees. The 80% cap prevents SSP from exceeding normal earnings.
Payroll should be checked to ensure the system:
For employers with high short-term absence levels, this is likely to increase cost. The most exposed sectors include care, hospitality, retail, cleaning, logistics and any business with a large part-time workforce.
Our piece on switching to cloud accounting for SMEs covers the systems side of managing rule changes cleanly.
Statutory family pay rates rose to £194.32 per week from April 2026. This applies across the UK, including Northern Ireland.
The flat rate covers:
For SMP, the first 6 weeks remain payable at 90% of average weekly earnings. After that, the rate is £194.32 or 90% of average weekly earnings, whichever is lower.
Check payroll systems for employees already on leave, because the new rate applies to weeks falling on or after the relevant April 2026 date.
For GB employers, paternity leave and unpaid parental leave became day-one rights on 6 April 2026. The previous qualifying service periods have been removed for the leave entitlement itself.
The pay rules are different. Statutory Paternity Pay still requires the employee to meet the normal qualifying conditions, including the 26-week continuous employment requirement by the relevant qualifying week.
That means an employee may be entitled to paternity leave from day one but not entitled to Statutory Paternity Pay from the employer.
GB employers should update policies, manager guidance and onboarding documents. Line managers also need to understand that family leave requests may arise during probation.
NI note: These day-one family leave changes are not yet in force in Northern Ireland. NI employers should continue applying NI law and monitor the Good Jobs Bill. Our piece on why internal audit supports business growth touches on the governance habit of tracking regulatory change before it becomes urgent.
GB employers now have a statutory duty to keep adequate records showing compliance with annual leave and holiday pay obligations. This came into force on 6 April 2026.
The duty covers records of entitlement, leave taken and holiday pay. Records should be retained for 6 years. Failure to keep adequate records can be a criminal offence.
The practical check is whether your payroll and HR systems record:
A simple spreadsheet that records only days taken may not be enough. Records need to show how entitlement and pay were calculated.
Our digital bookkeeping team works with businesses on the systems side of record-keeping and compliance.
For GB employers, the maximum protective award for failure to comply with collective redundancy consultation obligations doubled from 90 days’ pay to 180 days’ pay from 6 April 2026.
This is not simply a payroll issue. It is a major risk for employers proposing 20 or more redundancies at one establishment within 90 days. Getting consultation wrong can now be substantially more expensive.
The GB statutory limit on a week’s pay also increased from £719 to £751 from 6 April 2026. This affects statutory redundancy payments and the basic award for unfair dismissal. The maximum statutory redundancy payment in GB is now £22,530.
Northern Ireland has separate limits. The NI statutory week’s pay limit increased to £783 from 6 April 2026, so NI employers should use NI-specific figures.
If redundancies are possible, our corporate restructuring accountants team can help with the financial planning side. Our pieces on what an insolvency accountant does in business distress cases and how recovery accountants help improve cash flow cover the wider landscape where workforce cost decisions often sit.
From 6 April 2026, a disclosure about sexual harassment can explicitly qualify as a protected disclosure under whistleblowing legislation in Great Britain, provided the legal test for protected disclosure is otherwise met.
This means an employee or worker who raises a sexual harassment complaint may have whistleblowing protection against dismissal or detriment. Claims linked to whistleblowing can carry significant risk, including uncapped compensation.
GB employers should update whistleblowing and anti-harassment policies, train managers to recognise protected disclosures, and make sure complaints are escalated properly.
The Fair Work Agency was established on 7 April 2026. It brings together enforcement functions that were previously split across different bodies and is expected to strengthen enforcement of areas such as the National Minimum Wage, statutory sick pay, holiday pay and employment agency standards.
The agency is in a transitional year, so employers should expect its role and practical enforcement activity to develop further. Even so, the direction is clear. Payroll records, holiday records, statutory pay calculations and wage compliance are now under closer scrutiny.
Our piece on red flags of financial fraud in SMEs covers some of the financial patterns that can also attract regulatory attention.
Northern Ireland employers should separate UK-wide payroll changes from GB-only employment law reforms.
The changes applying in NI include:
The paid miscarriage leave change is significant. Northern Ireland now provides statutory paid leave where an employee experiences pregnancy loss before 24 weeks. The entitlement is a day-one right and is paid at the statutory rate of £194.32 per week, or 90% of average weekly earnings if lower. No medical evidence is required, and leave must be taken within the relevant statutory period.
For employers with staff in NI, GB and Ireland, this creates a complex payroll and HR position. Our Cross-border tax advisors team works with businesses managing multi-jurisdiction payroll and compliance. Our pieces on cross-border payroll and common tax mistakes expats and cross-border businesses make cover common friction points.
For employers with staff in the Republic of Ireland, Irish employment law is separate from UK and NI law.
Key Irish employer obligations in 2026 include:
For a cross-border employer, an Irish employee’s sick pay, minimum wage and leave position is different from that of a Northern Ireland or GB employee. Payroll systems need to handle each jurisdiction separately.
Our piece on setting up a company in both the UK and Ireland covers structural considerations, and VAT compliance for businesses operating across the UK to Ireland border covers the indirect tax dimension.
The Employment Rights Act 2025 does not stop at April 2026.
From 1 January 2027 in Great Britain, the ordinary unfair dismissal qualifying period reduces from 2 years to 6 months. The cap on compensatory awards for unfair dismissal is also due to be removed.
From 2027, GB employers should also prepare for guaranteed-hours rules for zero-hours and low-hours workers, subject to final detail. Wider bereavement leave, including pregnancy loss before 24 weeks, is also expected in GB in 2027.
For businesses relying heavily on flexible labour, the guaranteed-hours rules could be significant. For employers with short probation periods, the 6-month unfair dismissal threshold needs planning well before January 2027.
Our piece on how to prepare your business for sale covers how employment liabilities affect business value, due diligence and its importance in business explains how acquirers scrutinise compliance, and protecting the family business with a family charter covers the governance side for owner-managed employers.
The April 2026 changes increase cost and administration in several areas at once.
Employers are dealing with the NLW rising to £12.71, SSP from day one, lower-paid employees newly qualifying for SSP, statutory family pay at £194.32, continued pension auto-enrolment obligations, higher redundancy exposure in GB, and wider unfair dismissal risk from January 2027.
For businesses already dealing with margin pressure, these changes can compound quickly. Our piece on the future of financial planning and the key financial KPIs every SME owner should be monitoring monthly are useful reading. Where cost pressure becomes structural, our corporate restructuring accountants team can help. Our piece on what happens to creditors during company insolvency explains where unmanaged pressure can lead.
Where employment disputes, pay compliance issues or whistleblowing investigations become contentious, our forensic accountants UK team can support with financial reconstruction and expert analysis. Our pieces on what a forensic accountant does and when you need one, forensic accounting vs audit, and how forensic accounting helps in fraud investigations explain where that expertise applies. For broader assurance, our internal audit and external audit teams cover governance and reporting.
Many substantive provisions apply to Great Britain only. However, SSP reforms, NMW and NLW rate increases, and statutory family pay rate increases apply UK-wide, including Northern Ireland. Northern Ireland has its own employment law framework and separate reform programme through the Good Jobs Bill.
From 6 April 2026, SSP is the lower of £123.25 per week or 80% of the employee’s average weekly earnings.
SSP is now payable from the first qualifying day of sickness absence. The old 3-day waiting period has been removed.
The National Living Wage for workers aged 21 and over is £12.71 per hour. The 18 to 20 rate is £10.85, and the 16 to 17 and apprentice rate is £8.00. These apply UK-wide.
Northern Ireland introduced statutory paid miscarriage leave from 6 April 2026. Eligible employees experiencing pregnancy loss before 24 weeks can take up to 2 weeks’ leave, paid at the statutory rate or 90% of average weekly earnings if lower.
From 1 January 2027 in Great Britain, the ordinary unfair dismissal qualifying period reduces from 2 years to 6 months. The change does not automatically apply in Northern Ireland.
The Fair Work Agency was established in Great Britain on 7 April 2026. It brings together labour market enforcement functions and is expected to strengthen enforcement of areas such as minimum wage, statutory sick pay, holiday pay and employment agency standards.
No. The Employment Rights Act 2025 is UK legislation. Employees in the Republic of Ireland are covered by Irish employment law, including Irish minimum wage, statutory sick leave and PAYE Modernisation rules.
If your payroll system has not been updated for the April 2026 changes, or if you are uncertain about what applies to your NI workforce versus your GB workforce, now is the time to address it.
As accountants Armagh and across Northern Ireland, the wider UK and Ireland businesses rely on for payroll and compliance work, SCC Chartered Accountants can help you work through the checklist, update your processes and keep your team on the right side of a regime that has tightened.
Our digital bookkeeping team handles the systems side, our SME business solutions team covers operational and process changes, our tax compliance team handles tax and PAYE obligations, and our specialist tax team supports reliefs that may offset the rising employer cost base.
Get in touch with the SCC team for a payroll compliance review against the April 2026 changes and the further reforms still to come.
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