ERA 2025 Commencement Regulations, Equality Action Plans, Pay Gap Reporting And Further Consultations

6 April 2026 deadline

The Government has published further commencement regulations for the Employment Rights Act 2025, confirming the expected 6 April 2026 commencement date for the changes to statutory sick pay, whistleblowing disclosures and protective awards (in addition to changes to various family leave rights - see our earlier blog post here). New points to note:

• The regulations confirm that the doubling of the maximum protective award for failing to meet collective redundancy consultation obligations to 180 days' pay per affected employee will apply in respect of dismissals taking effect on or after 6 April 2026 (this is likely to be construed as applying only to awards in respect of a batch of dismissals, the first of which takes effect on or after 6 April 2026, and not where the effective dates of dismissal of a batch straddle 6 April - although the drafting could be clearer on this).
• The new obligation on employers to keep records for six years evidencing compliance with the statutory right to annual leave and pay is coming into force on 6 April 2026 (the timing for this had not previously been announced).
• The Fair Work Agency will be established on 7 April 2026 and will gain its enhanced enforcement powers in relation to agency workers, gangmaster licensing, labour abuse and the national minimum wage from that date; however, its enforcement powers in relation to holiday pay and statutory sick pay are not being brought into force as yet.
• A number of ERA 2025 provisions are commenced, empowering the Secretary of State to make further regulations in the future (eg, concerning equality action plans (see below), scope of NDA provisions, protections against dismissal following statutory family leave, and some details of the new fire and rehire protections - suggesting that secondary legislation in these areas may be imminent, as a necessary, preliminary step before the changes can be brought into force).

We have published a briefing highlighting action points for April 2026 and later, available to clients on request, and our podcasts here focus on the practical steps employers should take in respect of this first wave of reforms.

Also note that, from 6 April 2026, agencies and end-clients will become jointly and severally liable for PAYE and Class 1 NICs on payments to workers supplied through umbrella companies. Employers should review their labour supply chains for umbrella companies and audit compliance, contractual provisions and availability of insurance.

Equality action plans

The ERA 2025 includes provision to require large employers (with 250 or more employees) to publish gender pay gap and menopause action plans; this is expected to become mandatory for the 2027-8 reporting year (so publication will be due by April 2028). The Government is encouraging employers to publish an action plan voluntarily for the 2026-2027 reporting year (by April 2027) and has published guidance suggesting a list of possible evidence-informed actions to address concerns. The guidance requires employers to choose at least one step to address the gender pay gap and one to support employees experiencing menopause support, but encourages employers to select more. The guidance notes the importance of senior management engagement and training, and of input from a range of employees when developing the plan.

The list of actions are grouped as follows: 

• recruitment measures (eg, inclusive job descriptions, advertising family leave policies and flexible work options in job adverts, reducing unconscious bias in CV screening)
• developing and promoting staff (eg, automatic consideration of all eligible employees for promotion subject to opt-out)
• building diversity through targets
• increasing transparency (in relation to pay, promotion and rewards, and enhancing and promoting flexible working and family leave policies)
• menopause support (eg manager training, occupational health advice, support groups, workplace adjustments and risk assessments, policy review)

Additional guidance on creating an action plan is expected in April 2026. This will include suggested steps to identify the causes of a gender pay gap and to engage with employees, how to choose actions, how to publish the action plan, steps to track progress, and the reporting cycle.

It is worth noting that pay transparency has been identified as one potential measure, at a moment when the EU Pay Transparency Directive is approaching its implementation deadline for Member States in June 2026. Should large employers fail to include pay transparency within their action plans — once those plans become mandatory for the 2027–2028 cycle — they may face criticism from employees and stakeholders alike, particularly where they are already obliged to provide pay transparency for their European workforces. Moreover, if a significant proportion of large employers were to adopt this approach, it could lend weight to calls for the government to introduce comparable pay transparency requirements in the UK.

Large employers should start considering their approach now. 

Ethnicity and disability pay gap reporting

The Government has also just confirmed that it intends to press ahead with plans to legislate for mandatory ethnicity and disability pay gap reporting for large employers, following its 2025 consultation (discussed in our blog post here), although the proposed timing is yet to be confirmed. 

• The requirement will align with the gender pay gap reporting obligations in terms of requiring the same six calculations (mean/median pay, bonus gaps, quartiles, bonus participation), snapshot dates for collecting and reporting data, geographic scope, publication requirement and enforcement method.
• Large employers will be required to report their ethnicity and disability pay gaps, the overall composition of their workforce by ethnicity and disability, and the proportion of their employees who did not share their ethnicity or disability status, and to produce ethnicity and disability action plans. 
• Ethnicity data will need to be collected using the ethnicity classifications set out in the Government Statistical Service’s harmonised ethnicity standard and aggregated in line with guidance from ONS. Ethnicity pay gaps will need to be reported as a binary comparison and, provided there is a minimum number of employees in each group being reported on, also aggregated into five ethnic groups. The proposed threshold number of employees per reported group is 10, although this is subject to further consideration.
• Disability pay gap reporting will be binary (disabled and non-disabled, using the Equality Act 2010 definition of disability and again subject to a minimum number of employees in a group being reported on); the legislation will include the option to require more granular data if appropriate in the future.

The Government plans to develop a range of guidance and practical tools for employers. Employers may want to audit and potentially improve their current data capture now, and start considering what initiatives might be taken to address potential pay differentials.

Consultations

The Government has published two further consultations on ERA 2025 reforms:

• a consultation until 21 May 2026 on the proposed additional trigger for collective redundancy consultation obligations. Currently there is a duty to inform and consult if 20 or more redundancies are proposed at one establishment within 90 days; the ERA provides for an additional trigger based on the aggregated numbers across a multi-site employer's establishments, expected to be introduced from 2027. The consultation makes clear the Government's preference for a trigger of a fixed number of proposed redundancies (rather than a percentage of workforce), and suggests a single figure set somewhere between 250 and 1000 proposed redundancies (although the consultation also discusses the possibility of three, tiered thresholds of 250 for employers with up to 2,499 employees, 500 for a workforce of 2,500 and 9,999 employees, and 750 for the largest employers). The change will mean the obligations are triggered more frequently for large multi-site employers carrying out multiple small batches of redundancies across multiple sites (note that the threshold applies to individual employing entities and is not aggregated across group companies). The obvious action point will be to implement a system for tracking proposals and consultations to ensure compliance. Some may also want to consider setting up a single standing employee representative body to facilitate consultation, although this will not be mandatory: the law will be amended to make clear that employers do not have to consult all the employee representatives together nor to consult with a view to reaching the same agreement with all of the representatives. 
• a consultation until 23 April 2026 on the types of detriment that employers should be prohibited from imposing on workers for taking industrial action. The Government’s preferred option is to prohibit all detriments (rather than prohibiting a list of specific types). It also intends to add protection against detriment for taking industrial action to the list of claims for which a tribunal can uplift an award by up to 25% for breach of the Acas Code on Disciplinary and Grievance Procedures. 

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.