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Employment in the news | February 2026
23 February 2026
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An updated implementation timeline and several consultation exercises provide more detail about forthcoming Employment Rights Act reforms; the consultations on fire and rehire and flexible working are most relevant for our clients.
An EAT decision revisits the distinction between treating someone less favourably because of their protected beliefs, or because of the way they manifest those beliefs.
Chapter 1
Implementing the Employment Rights Act
Shortly after the Employment Rights Act (ERA) passed, the government confirmed that it was sticking to the original implementation roadmap.
A recent update confirms that the unfair dismissal qualifying period will reduce to six months for dismissals from 1 January. The government will remove the cap on unfair dismissal compensation and make fire and rehire dismissals automatically unfair at the same time.
Next steps
- Watch for further government updates on the timetable.
- Review contractual probationary periods and change contracts for new joiners if necessary.
- Click here for a one page reminder of what’s coming into force when.
Chapter 2
ERA consultations (1) – flexible working
The key change to flexible working rules under the ERA is the new requirement for refusals to be “reasonable”. Regulations will also introduce new procedural steps employers must follow before refusing a request.
The consultation sets out what those steps might involve. They include:
- Meeting the employee to discuss their request – which someone with the authority to agree new working arrangements must attend;
- Discussing why the employer cannot accommodate the original request and what alternatives might be available; and
- Summarising the matters discussed at the meeting in writing, along with the final decision, and any agreed next steps.
Many employers meet employees to discuss requests as a matter of course. It remains to be seen whether new procedural requirements will increase the number of successful requests.
Next steps
- The consultation closes on 30 April 2026.
- Depending on the outcome of the consultation, employers will need to review their flexible working policies and brief managers on the new requirements.
Chapter 3
ERA consultations (2) – fire and rehire
Under the ERA, it’s automatically unfair to dismiss an employee for refusing to agree to a “restricted variation” to their contract. A restricted variation includes removing or reducing an entitlement to expenses and benefits, unless the relevant expense or benefit is excluded. The fire and rehire consultation discusses which expenses or benefits to carve out of the general prohibition.
The government’s preferred option is to carve out all expenses and benefits in kind, because they don’t normally form an integral part of an employee’s take home pay and employers need flexibility to adjust benefits packages. However, another option would be carving out most expense and benefits allowances, except benefits relating to travel, accommodation or share schemes that are really a form of pay, because they form a significant part of remuneration and employees expect to receive income on the same basis in future.
Employers would still be able to vary or withdraw non-contractual allowances or benefits, or contractual allowances or benefits if they have a contractual right to do so.
Next steps
- The consultation closes on 1 April 2026.
- Depending on the outcome of the consultation, audit existing employee benefits and expenses and consider introducing contractual variation clauses where necessary.
Chapter 4
Protected beliefs in the workplace
Ngole v Touchstone Leeds revisits the complex issue of when treatment is because of an employee’s beliefs and when it’s because of the way they manifest those beliefs.
Mr Ngole posted comments reflecting his Christian beliefs about same-sex relationships and marriage on social media, which were widely reported in connection with an earlier legal claim. Some years later, he applied to Touchstone Leeds for a position as a mental health support worker and received a conditional offer of employment. Touchstone was committed to supporting the LGBTQI+ community and it decided to withdraw the job offer when it became aware of the earlier posts. It upheld the decision after a further meeting with Mr Ngole, because of concerns that he would not provide the required support to LGBTQI+ service users and about possible risks to staff and service users if they found Mr Ngole’s earlier comments online.
Mr Ngole claimed direct religion and belief discrimination. He was partially successful in the tribunal but appealed his unsuccessful claims. The EAT accepted that Touchstone’s concerns about the way Mr Ngole would perform his duties might be legitimate and justified. However, Touchstone had also relied on risks to service users and staff if they became aware of the posts. The tribunal had accepted this without considering whether users and staff would be upset by the views themselves, or by the way in which they were expressed. If they would have objected to the views themselves, and this led Touchstone to refuse to reinstate the job offer, that would amount to direct discrimination and could not be justified. If the concern would have been because of the way in which the beliefs were expressed, issues of justification would be relevant.
Next steps
- The decision highlights that an employer cannot take action against an employee in connection with protected beliefs simply because someone else objects to those beliefs.
- The question in each case is whether the beliefs have been manifested in an objectionable or inappropriate way, judged objectively.
- If the employee has manifested their beliefs objectionably or inappropriately, the employer needs to assess whether the action it wants to take is proportionate and whether it could achieve its objective in a less intrusive way.
Authored by Ed Bowyer, Stefan Martin, and Jo Broadbent.
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