Director Weekly  With the Employment Rights Act now in law, a raft of consultations throughout 2026 will be critical for shaping exactly how it affects employers. Will the government listen to business?

The government’s compromise was a welcome sign of willingness to listen to the concerns of the business community, but more needs to be done. In our survey of over 500 business leaders in December 2025, 57% said a significant scaling back of employment reforms would help boost business confidence – making it second only to a reduction in the tax burden on business (58%).

Restoring confidence should be a priority because the jobs market looks increasingly weak. January’s ONS data shows that payrolled employees fell 0.1% on the month – not a dramatic shift, but nonetheless a deeply unwelcome one on top of recent weak numbers. It adds up to a 0.6% drop on the year. Meanwhile, unemployment rose 0.3 percentage points on the quarter, and vacancies flatlined.

It is imperative, therefore, that the government uses secondary legislation to make the Employment Rights Act less damaging for employers. Opportunities to adjust course will emerge via a blizzard of consultations in the coming months: as many as 25 may be required.

They got under way with four consultations launched in the autumn, and we’ve now published the IoD’s responses. Here are a few of the key points.

• Enhanced dismissal protections for pregnant women and new mothers Proposals to narrow the rules to limit around employers’ ability to dismiss pregnant women or new mothers – for reasons including misconduct, capability or redundancy – are deeply concerning. We argue instead for improving the implementation of existing protections, for example by shifting the burden of proof for cases that reach tribunal.
• Leave for bereavement including pregnancy loss We argue bereavement leave should be reserved for workers who lose immediate family members, and should have a one-week duration.
• The duty to inform workers of their right to join a trade union We suggest government provide a model statement that employers might opt to use, and argue that informing workers should be done on a one-off basis.
• Trade unions’ right to access workplaces Addressing one of the biggest areas of concern for IoD members, we argue that the proposed exemption for businesses with fewer than 20 workers should be extended to all employers with fewer than 100 workers.

The year ahead will be a hugely busy one for workplace law. We’ll shortly be appearing before the Home Affairs select committee to give evidence on how employers might use digital ID. This Spring will see the Youth Guarantee pilots get under way. And of course we’ll be responding to consultations on the Employment Rights Act.

The devil will be in the detail, so we’ll ensure that IoD members’ views are heard in Whitehall – and continue to advocate for changes that make for a more workable environment for employers.

The IoD’s latest consultation responses are now available.

• Enhanced dismissal protections for pregnant women and new mothers
• Leave for bereavement
• The duty to inform workers of their right to join a trade union
• Trade unions’ workplace right of access