Change in the early years sector is rarely sudden, but it is often cumulative. The recently published roadmap for the Employment Rights Act 2025 is a good example of this: a series of measured reforms that, taken together, will shape how providers manage and support their teams over the coming years.
While headlines may suggest significant disruption, the reality is more considered. Most changes will be phased in gradually between now and 2027, giving providers time to adapt. The opportunity, therefore, is not to react, but to prepare with clarity and intent.
Employment Rights Act 2025 – A Practical Roadmap
For early years providers, the operational landscape is already complex. Managing ratios, covering absence, and supporting a predominantly female workforce through various stages of family life requires both structure and flexibility. Against this backdrop, the upcoming changes are less about transformation and more about evolution.
From April 2026, several key updates are expected to come into effect.
One of the most immediate shifts will be to Statutory Sick Pay (SSP), which is set to become payable from the first day of absence. In addition, the lower earnings threshold will be removed, meaning more employees will qualify. In a nursery environment, where unplanned absence can have a direct impact on ratios, this places greater emphasis on robust sickness reporting procedures and clear absence management processes.
Alongside this, family-friendly rights will expand. Paternity leave and unpaid parental leave are expected to become day-one entitlements, removing the requirement for a qualifying period of service. For providers, this will require a more proactive approach to workforce planning, ensuring that teams can accommodate these requests without compromising continuity of care.
Another notable development is the introduction of a Fair Work Agency. This new body will bring together existing enforcement functions and increase oversight of employment standards, including minimum wage, holiday pay, and statutory entitlements. While many providers already operate to a high standard, this signals a more structured and visible approach to compliance.
Looking further ahead, additional reforms are expected. These include potential restrictions on “fire and rehire” practices and updates to unfair dismissal rules. While the detail will continue to evolve, the direction of travel is clear: greater protection for employees, supported by stronger enforcement.
Preparing for What’s Ahead
The most effective response is not wholesale change, but careful alignment. Reviewing contracts, policies, and internal processes now will allow providers to respond confidently as each phase of reform is introduced.
Equally important is the role of managers. Those responsible for day-to-day decision making, whether handling sickness absence, responding to family leave requests, or managing employee concerns, will need a clear understanding of both current obligations and what is changing. Well-informed leadership at this level will be critical in ensuring consistency and compliance.
In many ways, these reforms reinforce what strong providers are already striving to achieve: fair, transparent, and well-managed workplaces that support both staff and the children in their care.
FAQs
What is the Fair Work Agency?
The Fair Work Agency is a new government body designed to bring together several existing regulators responsible for enforcing employment rights. Its remit will include oversight of areas such as the National Minimum Wage, Statutory Sick Pay, and holiday pay. With greater powers to investigate and enforce compliance, it represents a more coordinated approach to upholding employment standards.
Do I need to change anything?
Now is an appropriate time to review your contracts, policies, and payroll practices to ensure they remain aligned with upcoming changes. Just as importantly, managers should be confident in key processes, including sickness reporting, handling family leave requests, and escalating concerns such as harassment or whistleblowing disclosures. Preparation at this stage reduces the risk of reactive decision-making later.
What do I need to have ready by April?
A focused review will go a long way. Your sickness absence policy should reflect the move to day-one SSP, while family-friendly policies should be updated to incorporate day-one rights for paternity and unpaid parental leave. It is also worth ensuring that your payroll systems can accommodate these changes, and that managers are briefed on how to respond to requests in a consistent and compliant way.
What happens if I don’t comply?
Non-compliance, whether with new or existing requirements, may result in investigation by the Fair Work Agency. This could involve being required to correct underpayments, address procedural failings, or bring practices in line with legislation. In some cases, financial penalties may apply. Taking the time to review documentation and processes in advance is a practical way to mitigate this risk.
The direction of travel is clear: a more structured, transparent, and accountable employment landscape.
For early years providers, the challenge is not simply to keep pace, but to lead with confidence, ensuring that systems, processes, and people are aligned to support both compliance and long-term sustainability.
