Welcome to our June and July 2025 Employment Law Update!
This edition brings together a wide range of developments employers need to be aware of as we head into the second half of the year. We spotlight upcoming changes to non-disclosure agreements, where certain clauses will soon be unenforceable, and provide updates on the Government’s Equality Law and Parental Leave reviews.
We also cover the latest progress on the Employment Rights Bill, key tribunal rulings on redundancy and belief-based dismissals, and a case examining liability for outsourced worker pay. Finally, we flag a major funding change affecting Level 7 apprenticeships from January 2026.
Non-disclosure agreements – changes to disclosure rules
NDAs signed on or after 1 October 2025 that seek to prevent signatories reporting criminal behaviour such as sexual assault, or other types of inappropriate conduct that should be reportable, will be deemed void and not enforceable. Employers should review their NDAs to ensure that they do not contain any clauses that try to prevent employees from making permitted disclosures because if signed on or after 1 October, they won’t be enforceable. If you would like any assistance with reviewing NDAs, please contact us and we can put you in touch with our Commercial team.
Employment Rights Bill (“ERB”) - Call for Evidence
Equality Law
In April the Government launched a Call for Evidence, seeking views on proposed equality law reforms in addition to those already included in the ERB.
The following areas were covered:
- the prevalence of pay discrimination on the basis of race and disability
- making the right to equal pay effective for ethnic minority and disabled people
- measures to ensure that outsourcing of services can no longer be used by employers to avoid paying equal pay
- improving the enforcement of equal pay rights by establishing an Equal Pay Regulatory and Enforcement Unit, with the involvement of trade unions
- improving pay transparency
- strengthening protections against combined discrimination
- ensuring the Public Sector Equality Duty (PSED) is met by all parties exercising public functions
- creating and maintaining workplaces and working conditions free from harassment
- commencing the socio-economic duty
The consultation closed on 30 June 2025, but it is a useful reminder of the Government’s thinking and the future direction in which it may take equality legislation.
Parental leave and pay system review
On 1 July 2025, the Government launched a further Call for Evidence, seeking views on the parental leave system which it believes requires further improvement to support working families more effectively. This will be an internal government review, although external stakeholder views will be considered to ensure the review reflects a wide range of perspectives. The review is expected to run for 18 months, following which the Government will provide their findings and a roadmap for next steps with respect to any potential reforms.
Employment Rights Bill (“ERB”) – Trade Unions
On 10 June 2025, the House of Lords Committee agreed government amendments to union recognition during its eighth sitting.
They are:
- After a trade union has been officially recognised by the Central Arbitration Committee (CAC), affected employers have five working days in which they must provide certain information about workers in the bargaining unit (i.e. name, date of birth and the category of worker to which they belong).
- There will be 20 working days (up from an originally intended 15 days) for the union and employer to agree arrangements for the union to access workers in the bargaining unit.
- After a union has been recognised, both parties can apply to the CAC to decide whether a bargaining unit continues to be appropriate.
Employment Rights Bill (“ERB”) – The Roadmap
The Government published a roadmap on 1 July 2025 setting out how the Government intends to implement the Employment Rights Bill, which is central to the Government’s promise to introduce legislation to “Make Work Pay”. It is clear from this roadmap that the Government is still intent on consulting on the proposed changes under the Employment Rights Bill so that the legislative changes will “work for all”, and the paper provides further clarity on the proposed timings and arrangements for such a consultation. Detail on anticipated commencement dates for different elements of the Bill will be provided, enabling both employers and workers to see when the changes under the Bill come into effect, which is essential for helping businesses to plan ahead. The roadmap can be reviewed in full here.
A timely reminder about fair redundancy procedures
Two recent tribunal cases are a timely reminder to employers to ensure that if they may need to make staff redundant, they must follow the correct procedures (the procedure to be followed will depend on the number of potential redundancies).
In Hendy Group Ltd v Daniel Kennedy, the EAT emphasised the need for employers to be active rather than passive in helping those at risk of redundancy find other suitable jobs within their organisation. The Tribunal has also reinforced the importance of collective consultation being properly undertaken, which is currently required where 20 or more redundancies are proposed at one establishment.
Following the collapse of Wilko, a tribunal has found that the company breached the collective consultation rules and, as a result, has awarded over £2m to almost 10,000 ex-employees. If you find yourself needing to consider making redundancies, please consult our guide first and/or contact a member of the team who will be happy to help.
Apprentice funding
From 1 January 2026, only people under 22 will have access to funding to pursue a higher-level apprenticeship (Level 7). Funding will only be used to fund courses for existing apprentices and those aged 16 – 21 at the start of the programme.
Case updates
Higgs v Farmor’s School now settled after Supreme Court refuses school permission to appeal
The case of Higgs v Famor’s School has finally run its course with the Supreme Court having rejected the school’s application to appeal against the Court of Appeal’s finding that Mrs Higgs was unfairly dismissed. To summarise, Mrs Higgs was dismissed from her administrative pastoral role at Farmor’s School for gross misconduct ‘on the balance of probability she could have held discriminatory views’, after she posted comments on her Facebook page that were deemed transphobic and homophobic.
The original tribunal dismissed Mrs Higgs’ claim that her gender-critical views were a protected characteristic, so she appealed. The EAT remitted the case back to the ET to apply the proportionality test in determining whether the correct balance was struck between Mrs Higgs’ right to express her Christian beliefs and the degree of offence caused by the way in which they were expressed. Mrs Higgs appealed to the Court of Appeal on the grounds that the EAT should have upheld her claim.
The Court of Appeal allowed Mrs Higgs’ appeal, finding that she should succeed on her claim that her dismissal was unlawfully discriminatory. In response, the school applied to the Supreme Court for permission to appeal, which has now been rejected, bringing the case to a close. The Court of Appeal’s finding underlines the importance of assessing facts objectively: in Mrs Higg’s case, this meant deciding whether the manifestation of Mrs Higgs’ Christian beliefs in social media posts, unconnected with her work, was reputationally damaging for the school.
Ministry of Justice not responsible for outsourced workers’ pay rates
Djalo v Secretary of State for justice
The Ministry of Justice (MoJ) contracts out the cleaning of its building to OCS. One of the cleaners, Ms Djalo, whose contractual arrangement is with OCS and not the MoJ, claimed indirect discrimination against the MoJ for their failure to uplift her wage to the London Living Wage, which is what the MoJ pays its directly employed staff. Her argument rested on her contention that the MoJ had the contractual power to require OCS to increase pay levels. Ms Djalo also alleged racial discrimination as most of her fellow workers providing their services to the MoJ via OCS are black or of ethnic minority (BME). The ET struck out her claim, ruling that section 41 of the Equality Act does not protect a claimant contract worker against differences in their pay and that of the employees of the contracting organisation. Ms Djalo appealed to the EAT on ten grounds. The EAT dismissed the appeal.
Readers may be interested to note that the government’s recent call for evidence on possible changes to equal pay legislation addresses this question of outsourced workers’ pay rates (see above) and wants to understand the extent of pay discrimination suffered by outsourced workers. Although any changes, if approved, will not be imminent, employers that provide outsourced services need to be aware of these proposals and factor them into future pay plans.
The information provided in this article is provided for general information purposes only, and does not provide definitive advice. It does not amount to legal or other professional advice and so you should not rely on any information contained here as if it were such advice.
Wright Hassall does not accept any responsibility for any loss which may arise from reliance on any information published here. Definitive advice can only be given with full knowledge of all relevant facts. If you need such advice please contact a member of our professional staff.
The information published across our Knowledge Base is correct at the time of going to press.
