Employment law changes: What you need to know

What's happened?

The Government have brought about wide-ranging changes to employment law. These changes are being in introduced in phases across 2026 and 2027, however most them are coming into force from 06 April 2026. We're writing this article to raise awareness on how these changes affect small businesses. We may update this article from time-to-time as things develop.

Statutory Sick Pay (SSP)

How it currently works

Employees that are entitled to Statutory Sick Pay (SSP) are not paid for the first three days of sick leave. These three days are known as waiting days.

To be eligible for SSP an employee must earn at least £125 per week. This means that part-time workers who don't work many hours are often not entitled to SSP. There are also other eligibility requirements which are outside the scope of this article.

What are the changes?

The new rules entirely remove the three waiting days so that employees are entitled to SSP from their first day of sick leave.

The earnings requirement of £125 per week is also being removed. Employees will no longer have to earn a minimum amount to be entitled to SSP.

The impact

With the removal of the three waiting days employees will be entitled to more SSP than before, and with the removal of the minimum earnings requirement, pretty much every employee will be eligible for SSP (again with no waiting days).

These changes have left some to speculate that we will see an increase in the amount of people seeking a job to immediately go on sick leave. As always, small business owners will need to be vigilant when taking on new staff and ensure they have good processes in place. If an employee is on sick leave for more than 7 days, employers should ensure they request a fit note (also known as a sick note).

Paternity leave

How it currently works

Employees must have been continuously employed for at least 26 weeks to be entitled to paternity leave.

What are the changes?

From 06 April 2026 paternity leave will be a "day one right" which will allow an employee to give notice of leave from their first day of employment.

The impact

Small businesses will need to ensure they have the processes in place to handle day one leave requests and a plan to cover the work the new hire would have been carrying out whilst they are on leave.

Next steps

If you are an employer you should:

• Read the summary of changes from ACAS: https://www.acas.org.uk/employment-rights-act-2025
• Review and update your company handbook, policies and procedures
• Seek HR/legal advice if you feel you need it

For TaxBoxx clients we are ready to handle these changes on the payroll side. Please note however that we are accountants and tax advisers and we are therefore unable to give employment law advice. This article is to raise awareness for our clients and the broader small business community. If you have concerns and would like to discuss how this will impact your business please feel free to contact us.