4 Nov 25
A year on from the announcement of the Employment Rights Bill (ERB), the legislation is still being debated in Parliament and, after the House of Lords recently voted down the Government’s plans on a number of key proposals, the ERB may not become legislation until later this year or into 2026. However, we do know the ERB is coming, and it promises to be the biggest shake-up of employment law in some time. Here, we have picked out three key issues for employers in sport and provide some practical tips to help prepare for the ERB when it does arrive.
1. (Day 1) Unfair Dismissal Rights
What’s changing? The Government’s original proposals for ‘day 1’ unfair dismissal rights have so far been blocked by the House of Lords, which is insisting on a six-month qualifying period of employment before employees are eligible to bring unfair dismissal claims. Either way, the current minimum requirement for two years’ employment will be substantially reduced. This means that employers will need to demonstrate a fair reason for dismissal (e.g. conduct, capability, redundancy etc.) and follow a reasonable process for all dismissals, even in the very early stages of employment. Alongside an extended time limit of six months to bring a claim (up from three months), this is likely to significantly increase the risks of employment litigation for employers.
To temper the impact to employers of earlier unfair dismissal rights, the Government has also proposed a statutory probation period. This is subject to further consultation and it is not yet clear how this will differ from contractual probationary periods which many employers already use, but it is likely to allow for “lighter-touch” dismissal processes during an initial probationary period prescribed by law.
What can you do? In short, it is going to become harder to terminate employment during its early stages. Employers in sport often have large headcounts and there will inevitably be occasions where employers would prefer to dismiss employees if they are not performing or conducting themselves as expected early on. Employers would therefore be well advised to re-evaluate their recruitment and onboarding processes and, where possible, make them more robust to limit the likelihood of early dismissals. Employers might also consider implementing more formal and regular performance management during probationary periods to help demonstrate any early dismissal is fair.
2. Confidentiality and Non-Disclosure Agreements (NDAs)
What’s changing? In response to concerns that victims of sexual harassment and discrimination have been silenced by employers through the use of NDAs, the ERB will effectively void any NDAs or confidentiality clauses which stop staff speaking about: (a) harassment or discrimination which has affected them or their colleagues; or (b) an employer’s response to complaints or allegations of misconduct (e.g. an employer’s failure to properly investigate an allegation of sexual harassment).
What can you do? Given the high profile of employers in sport, reputation management is often critical and settlement agreements containing confidentiality clauses (effectively NDAs) are commonplace. Employers will need to revisit their standard settlement agreements and NDAs to ensure they contain appropriate guidance and prompts on when they should be used and what they can and can’t cover. Employers should also assess how regularly NDAs are being used across their organisation, as those who rely heavily on settlement agreements and NDAs may need to think carefully about whether there are any wider workplace issues they need to address to ensure any complaints are resolved effectively to help reduce the number of occasions where settlements and NDAs become necessary.
3. Zero Hours Contracts
What’s changing? Although there is no outright ban on zero-hours contracts, workers on these contracts who regularly work in excess of their anticipated hours will be entitled to a “guaranteed hours contract” which reflects the average hours they work over a certain “reference period” (previously reported to be 12 weeks).
What can you do? The ERB could have significant implications for organisations that regularly use zero-hours workers to staff sports events (e.g. hospitality staff during a tournament) or rely on casual staff to service their business as and when required (e.g. ground staff or stewards at sports clubs). These organisations will need to re-assess their staffing models to adapt to these more restrictive rules and avoid inadvertently giving casual staff rights to guaranteed work where this would be problematic or impractical. Organisations will need to think creatively, but alternatives may include using more agency staff or short fixed-term contracts.
