Employment laws in the UK: a complete guide for employers

Employment laws in the UK set minimum standards for pay, working hours, leave, workplace safety and fair treatment. Employers must also verify employees' right to work, protect personal information and follow lawful procedures when terminating employment. With several employment law changes taking effect in 2026 and 2027, reviewing your existing hiring and HR policies is particularly important.

Understanding the main employment laws in the UK

UK employment rights are established through several pieces of legislation, including the Employment Rights Act 1996, Equality Act 2010, National Minimum Wage Act 1998 and Working Time Regulations 1998.

The Employment Rights Act 2025 introduces further changes, with different provisions coming into force throughout 2026 and 2027.

Employers should also recognise that some employment legislation differs between Great Britain and Northern Ireland.

Recruitment and employment contracts

Under the Employment Rights Act 1996, employees and workers entitled to a written statement of employment particulars must receive their principal terms when employment begins.

These terms include salary, working hours, holiday entitlement, job responsibilities and notice provisions.

Employers must also establish whether someone is legally classified as an employee, worker or self-employed contractor. These classifications affect statutory rights, including holiday pay, sick pay and protection against dismissal.

Calling someone a contractor in their agreement does not automatically make them self-employed. Their actual working relationship matters.

Right to work requirements

Employers must verify that individuals have permission to undertake the work before their engagement begins.

The Home Office updated its right to work guidance on 1 October 2026, extending prescribed checks to additional working arrangements, including certain workers and individual subcontractors.

Employers should use the correct verification method and retain evidence of checks.

Civil penalties for employing someone without the necessary permission can reach £60,000 per illegal worker.

Our guide to UK right to work checks explains the process and the records employers need to maintain.

Working conditions and employee entitlements

Minimum wage

From 1 April 2026, the National Living Wage is £12.71 per hour for workers aged 21 and over.

Other statutory hourly rates include:

• £10.85 for workers aged 18 to 20.
• £8.00 for workers under 18 but above school-leaving age.
• £8.00 for apprentices under 19, or those aged 19 and over in their first apprenticeship year.

In April 2027 all rates will increase by 3.9%.

Employers must account for all qualifying working time and ensure deductions do not reduce pay below the applicable minimum.

Working hours and rest periods

The Working Time Regulations generally restrict average weekly working hours to 48, normally calculated over 17 weeks.

Adult workers can voluntarily agree in writing to opt out, subject to restrictions for certain occupations.

Workers are generally entitled to a 20-minute uninterrupted rest break when working more than six hours, alongside daily and weekly rest periods.

Annual leave and sick pay

Most workers are entitled to 5.6 weeks of paid annual leave each year. For someone working five days per week, this generally means 28 days, which can include bank holidays.

From 6 April 2026, eligible employees can receive Statutory Sick Pay from their first full day of sickness absence. The previous lower earnings threshold has also been removed.

Employers should check that absence policies and payroll systems reflect these changes.

Employee benefits and compulsory contributions

Workplace pensions

Under automatic enrolment rules, eligible employees must be enrolled in a qualifying workplace pension scheme.

Employers generally contribute at least 3% of qualifying earnings, with minimum total contributions of 8%.

Employers must also operate PAYE and account for the applicable employer National Insurance contributions.

Family-related leave

Eligible employees have statutory rights relating to maternity, paternity, adoption and parental leave.

From April 2026, statutory paternity leave and unpaid parental leave became day-one rights, although eligibility for statutory payments remains subject to separate conditions.

You should distinguish between entitlement to time off and entitlement to statutory pay when preparing employment contracts and employee policies.

Anti-discrimination and workplace protection

The Equality Act 2010 protects individuals from discrimination related to characteristics including age, disability, race, religion, sex and sexual orientation.

Employers must apply fair practices throughout recruitment, employment and dismissal.

For example, rejecting a candidate because of assumptions about their age can create discrimination risks even before they become an employee.

Employers also have duties to take reasonable steps to prevent sexual harassment at work.

The Health and Safety at Work etc. Act 1974 requires employers to protect employees' health, safety and welfare so far as reasonably practicable.

Termination of employment

Employees can challenge dismissals that are unlawful or procedurally unfair. Here's what you need to know:

• In Great Britain, the ordinary qualifying period for unfair dismissal protection remains two years until 1 January 2027, when it is scheduled to reduce to six months. Some protections apply from the first day of employment.
• Northern Ireland has separate rules, including a generally shorter qualifying period.
• When dismissing an employee, employers should establish a lawful reason, follow an appropriate process and provide the required notice or payment in lieu.
• The Employment Rights Act 2025 also changed employment tribunal time limits. For most relevant claims arising on or after 1 October 2026, the time limit increased from three months to six months.

Data protection and employee background checks

The UK GDPR and Data Protection Act 2018 regulate how employers collect, use and retain candidate and employee information.

• Background screening must have an appropriate lawful basis, and criminal-record information requires additional safeguards.
• Employers should only request checks that are proportionate to the role. Enhanced criminal-record checks, for example, are restricted to eligible positions.
• A structured screening process helps employers verify qualifications, employment history and identity while maintaining appropriate data protection controls.

Veremark provides background screening services in the UK, including employment verification, criminal-record checks and right to work screening.

Why employers should regularly review UK employment compliance

Following employment laws in the UK requires attention to both established employee rights and new statutory requirements.

A hiring process that worked in 2024 may no longer meet the requirements for contingent workers or digital right to work verification.

Review your employment contracts, payroll arrangements, hiring procedures and termination policies whenever legislation changes.

For organisations recruiting across multiple countries, Veremark's background checking services can help maintain consistent verification processes while accounting for local requirements.

FAQs

What are the main employment laws in the UK?

The Employment Rights Act 1996, Employment Rights Act 2025, Equality Act 2010, Working Time Regulations 1998 and National Minimum Wage Act 1998 are among the principal laws governing employment.

Can an employer dismiss someone without notice?

Summary dismissal may be lawful in cases of gross misconduct, subject to the circumstances and an appropriate procedure. Employers must also consider contractual terms and statutory protections.

Are background checks mandatory for UK employers?

Right to work checks are a legal requirement for relevant working arrangements. Other checks depend on the role, sector and applicable regulations. Enhanced criminal-record screening is restricted to eligible positions.