EARLY 2025
New employment tribunal rules
New employment tribunal rules came into force on 6 January. The changes to the rules are largely a tidying up exercise. This is due to be followed in February by a Practice Direction that will result in employers no longer being able to lodge their response (ET3 forms) by email, although a period of grace will be given for around 5 weeks after the Practice Direction comes into force. Thereafter any response to a Tribunal claim will only be able to be lodged using the tribunal service online system, by post or by hand.
Compensation for claims for protective awards
As of 20 January, an amendment to the Trade Union and Labour Relations (Consolidation) Act 1992 enabled tribunals to increase or decrease compensation by up to 25% in claims for a protective award where it appears a party has not complied with the statutory Code of Practice on Dismissal and Re-engagement.
SPRING 2025
National living and national minimum wage
1 April saw the annual changes to the national living and national minimum wage take effect. As of that date: -
- NLW (for those aged 21 and over) increased from £11.44 to £12.21 per hour
- NMW (for those aged 18 to 20) increased from £8.60 to £10.00 per hour
- NMW (for those aged 16 and 17 and apprentices aged under 19 or in the first year of their apprenticeship) increased from £6.40 to £7.55 per hour
Statutory benefits
With effect from 6 April statutory sick pay increased from £116.75 to £118.75 per week. Statutory maternity, paternity, shared parental, adoption and parental bereavement pay increased from £184.03 to £187.18 per week.
Tribunal compensation
The Employment Tribunal award limit changes apply to dismissals that take place on or after 6 April 2025. The limit on the compensatory award for unfair dismissal increased to £118,223 (or 52 weeks pay based on gross salary prior to dismissal, including employer pension contribution but excluding benefits in kind and discretionary bonus, whichever is the lower).
The limit on a week's pay (used for calculating statutory redundancy payments and the basic award for unfair dismissal) increased from to £700 to £719 meaning that the maximum basic award and maximum statutory redundancy payment increased to £21,570.
Guidelines for injury to feelings awards
An award for injury to feelings is made to compensate for injury to feelings caused by discrimination. This award is separate from an award to compensate for financial loss and can be made even where no financial loss has been suffered. To assist Employment Tribunals, the Court of Appeal previously set out guidance for quantifying awards for injury to feelings, known as the Vento bands. For claims presented on or after 6 April 2025 the bands are as follows: -
- Lower band (less serious cases) - £1,200 to £12,100
- Middle band (for cases that do not merit an award in the upper band) - £12,100 to £36,400
- Upper band (for most serious cases) - £36,400 to £60,700
Awards of more than £60,700 will only be made in the most exceptional cases.
Gender pay gap reporting
30 March saw the gender pay gap reporting deadline for public sector employers (using 31 March 2024 as a snapshot date).
4 April saw the gender pay gap reporting deadline for private companies and voluntary organisations with 250 or more staff, using a snapshot date of 5 April 2024. Year on year data shows slow progress in addressing gender pay gaps, with only a 1.6% drop since mandatory monitoring was introduced, so there is still much work to be done.
Neonatal leave and pay
The Neonatal Care (Leave and Pay) Act 2023 introduced a right to up to twelve weeks of leave for parents of children receiving neonatal care. The leave will be paid if parents meet qualifying criteria. For more detail on this see Neonatal leave and pay - what to expect
LATER IN 2025 AND BEYOND
Employment Rights Bill
The Employment Rights Bill is currently expected to receive Royal Assent in September 2025.
An Implementation Roadmap was published on 1 July which provides clearer guidance on when future consultations are planned to take place, and when the majority of provisions are intended to be implemented. This shows a number of measures are not expected to take effect until 2027, including protection from unfair dismissal becoming a day 1 right. For more on the detail of the roadmap see our summary of the important dates
Non-disclosure Agreements
A late government amendment to the Employment Rights Bill that will void any clause in an agreement between an employer and worker that (a) prevents the worker from making either an allegation or a disclosure of information about "relevant harassment or discrimination"; or (b) prevents the worker making an allegation or a disclosure of information relating to the response of the employer to those allegations, or the making of them, was introduced shortly before the summer parliamentary recess. The ban will not apply to "excepted agreements". While it is not yet clear exactly what that will include, it seems a non-disclosure agreement ("NDA") requested by a worker will be excepted from the ban.
Additionally, other new legislation concerning the use of NDAs take effect in Autumn 2025. Since 1 August the Higher Education (Freedom of Speech) Act 2023 prevents English higher education providers, including universities, from entering into NDAs with staff, students or visiting speakers in relation to sexual abuse, harassment or misconduct as well as other types of harassment and bullying.
From 1 October, the Victims and Prisoners Act 2024 will make NDAs unenforceable against victims of crime in relation to disclosures of information to a specified list of people and organisations including the police, a victims close family and victim support services. This may be of relevance where, for example, an employee signs a settlement agreement after having been the victim of a crime (or where the employee reasonably believes they have been a victim of a crime) in the workplace.
It should be noted that neither of these provisions apply in Scotland.
Equality (Race and Disability) Bill
A draft Equality (Race and Disability) Bill is to be published during this parliamentary session for pre-legislative scrutiny. This is intended to enshrine the full right to equal pay in law for ethnic minorities and disabled people. It will also introduce mandatory ethnicity and disability pay reporting for employers with 250 or more employees - a consultation on this was launched by the UK Government in March 2025.
The Paternity Leave (Bereavement) Act 2024
This Act, which was made under the Conservative government will, amongst other things, remove the 26-week qualifying service for fathers and partners to take paternity leave where the mother (or adoptive parent or intended parent for surrogacy purposes) dies shortly after childbirth. It will also remove the condition preventing bereaved partners who have already taken shared parental leave from then taking paternity leave. Regulations are required to bring this Act into force, and the Labour MP who sponsored the Bill indicated it was also intended to increase paternity leave from two to 52 weeks via those regulations. This legislation was introduced by the Conservative government, but it is clear the policy intentions behind it are aligned with those of the current Labour government.
The Pensions (Extension of Automatic Enrolment) Act 2023
There is no timescale for implementation of this Act which will reduce the minimum age for eligibility for pensions automatic enrolment. It will also reduce or remove the lower end of the qualifying earnings band.
KEY CASES FOR 2025
There are a number of high-profile cases due to be heard in 2025, most notably: -
Augustine v Data Cars Ltd - in this case the EAT had held that although a part-time driver had been less favourably treated than a full-time comparator, that was not a breach of the Part-Time Workers Prevention of Less Favourable Treatment) Regulations 2000 because the part-time status was not the sole cause of the treatment. The EAT reached this decision on the basis it felt bound to follow a Court of Session judgment on the matter, even though it believed the Court of Session judgment had been decided wrongly.
UPDATE - The appeal was unanimously dismissed by the Court of Appeal, but on the ground that it was more desirable that the Supreme Court resolve the matter rather than on the merits of the case. The three judges were split on whether the Court of Session judgment that the EAT had followed had been decided correctly or not. Leave to appeal to the Supreme Court has been granted.
Sullivan v Isle of Wight Council - the issue in this case is whether the Employment Rights Act 1996 should be interpreted to allow an external job applicant to bring a whistleblowing claim. The EAT held it should not, but an appeal is due be heard in the Court of Appeal in February 2025.
UPDATE - The Court of Appeal have dismissed the appeal, holding the exclusion of job applicants from whistleblowing detriment protection is not incompatible with the European Convention on Human Rights.
Lister v New College Swindon - the claimant is appealing an employment tribunal judgment that, although his gender critical beliefs were protected, dismissal was a proportionate response by his employer to the manner in which he had expressed those beliefs. Our summary of the case can be found Dismissed gender critical teacher not discriminated against.
Miller v University of Bristol - an appeal is due to be heard on 12 November against an employment tribunal judgment that an academics anti-zionist beliefs were protected beliefs under the Equality Act 2010 and that is dismissal was both unfair and discriminatory. More details on the tribunal judgment is available at Anti-Zionist beliefs qualify as protected beliefs
Bailey v Stonewall & Others - this well publicised case will head to the Court of Appeal towards the end of 2025. The claimant is appealing the EAT judgment that found that Stonewall had not caused or induced discrimination carried out by the barrister's chambers she worked for. Our overview of the EAT judgement can be found Stonewall - third party not liable for inducing employer's discrimination.
Groom v Maritime and Coastguard Agency - the Court of Appeal is due to hear this case, which concerns whether a volunteer coastal rescue officer is a worker with employment rights, in November 2025.
During the course of 2025 we should also see judgments handed down in relation to a number of cases of interest that were heard in 2024. These include: -
For Women Scotland Ltd v The Scottish Ministers was heard by the Supreme Court in November 2024. The issue the Court is to decide upon is whether a person with a full gender recognition certificate which recognises their gender as female, is a woman for the purposes of the Equality Act 2010.
UPDATE - The Supreme Court has upheld the appeal, finding the terms "sex", "woman" and "man" contained in the Equality Act 2010 refer to biological sex only and do not include transgender people either with or without a gender recognition certificate.
Higgs v Farmor's School was heard by the Court of Appeal in October 2024. An employment tribunal found that a Christian employee's gender critical beliefs were protected under the Equality Act, but that the employee's disciplining and dismissal were not because of those beliefs. The EAT upheld an appeal and remitted the question of whether the reason for the employer's actions had been because of or related to the manifestation of her protected beliefs rather than a justified objection of that manifestation. It is the decision to send the case back to the employment tribunal that the claimant is appealing, arguing that the EAT should have substituted their own determination on the matter.
UPDATE - The Court of Appeal upheld the appeal, substituting a finding that the claimant had been directly discriminated against. A further appeal to the Supreme Court has been refused.
