Key legislative changes and caselaw from 2025

Key legislative changes and caselaw from 2025

Whilst the Employment Rights Act 2025 has of course dominated 2025 and will continue to do so into 2026 and beyond, as we leave 2025 behind lets remind ourselves of some of the other key legislative changes and caselaw decisions which occurred during the year.

Major Legislative Changes

☑️ Neonatal Care (Leave and Pay) Act 2023

April 2025 saw the introduction of the Neonatal Care (Leave and Pay) Act 2023. This was a welcomed piece of legislation providing working parents protected time off when their baby needs critical care, without eating into standard maternity or paternity leave and with possible statutory pay to help with financial pressures during a difficult time.

1st April 2025 saw changes to minimum pay levels to include:

• National Living Wage (21+) increased to £12.21/hr
• National Minimum Wage for 18–20s rose to £10.00/hr
• 16–17s and apprentices increased to £7.55/hr
  
  

From 6th April 2025 employers were required to pay higher statutory rates:

• Statutory Sick Pay (SSP) up to £118.75/week
• Statutory maternity, paternity, adoption, shared parental and parental bereavement pay up to £187.18/week
• The Lower Earnings Limit for qualifying for these payments rose to £125/week.

From 6th April 2025 the following changes to NIC came into force:

• Employers’ NIC rate increased to 15%
• The threshold for paying NICs dropped from £9,100 to £5,000/year (this remains until April 2028).

From 6th April 2025, Tribunal compensation and statutory limits increased to:

• A week’s pay cap rose to £719
• Maximum unfair dismissal compensatory award increased to £118,223
• Statutory redundancy pay cap rose as well
  
  

Currently, UK equality law (the Equality Act 2010) protects people from unfair treatment based on characteristics like race, sex, disability, age, etc. But:

• employers and campaigners have called for better tools to close racial and disability pay gaps
• it can be hard for individuals to challenge unfair pay or discrimination
• there is limited transparency about how race and disability affect pay and opportunities

The proposed Equality (Race and Disability) Bill is meant to target these gaps and make equality law stronger and more effective, by doing the following:

1. Strengthen equal pay rights

At the moment, equal pay law focuses mainly on gender.  The Bill would make it clear in law that people should be paid fairly regardless of race or disability.

In practical terms:

• if someone is paid less than a colleague, and the difference is because of race or disability, they would have a stronger basis to challenge that legally.

This is intended to help reduce unfair pay disparities.

2. Mandatory ethnicity and disability pay gap reporting

Like current gender pay gap reporting, the Bill would require large employers (typically those with 250 or more employees) to publish data on:

• how much employees of different races are paid
• how much employees with disabilities are paid

This is called pay gap reporting. The aim is to make pay inequalities transparent, so employers can see where gaps exist and take action.

3. Greater transparency and accountability

The Bill may include measures to:

• encourage employers to explain why pay gaps exist
• require them to set out action plans to address inequalities
• give workers more confidence that issues will be investigated

Who would the Bill affect?

• Employers with 250+ workers would likely need to collect, analyse and report race and disability pay data
• Larger public bodies would also be included
• Smaller employers would not usually be required to report unless the law specifies otherwise

All workers could benefit indirectly, because the changes push organisations to address unfair pay and treatment.

What is still to come?

Because the Bill is still in development:

• some details are not yet final
• there may still be further consultations
• final deadlines for reporting and enforcement are yet to be confirmed
• timing of when it becomes law and when parts come into force is still being decided (likely not until 2026–2027 at the earliest)

Major Case Law decisions

For Women Scotland Ltd v The Scottish Ministers

Background – What was this case about?

The case arose from a disagreement about what the word “woman” means in law, and who can be counted as a woman for the purpose of meeting legal targets for public board representation.

In Scotland, a law called the Gender Representation on Public Boards (Scotland) Act 2018 was introduced to improve the number of women sitting on public boards. To help public bodies apply the law, the Scottish Government issued official guidance explaining how organisations should count women when working out whether they had met the required targets. The guidance stated that:

• Trans women who hold a Gender Recognition Certificate (GRC) should be treated as women
• These individuals could therefore be counted towards the legal requirement to have a certain proportion of women on public boards

In practice, this meant that a person who was biologically male at birth, but who had legally changed their gender through the GRC process, would be included in the “women” category for the purposes of the quota.

Why was this challenged?

A campaign group called For Women Scotland challenged the guidance. They were not challenging the rights of trans people generally, but the legal basis for redefining the word “woman” in this specific context.

They argued that:

• The meaning of “sex” and “woman” is already defined in UK-wide law, specifically in the Equality Act 2010
• Under that Act, “sex” is a protected characteristic, and it refers to biological sex
• Equality law is a matter reserved to the UK Parliament, not the Scottish Parliament
• The Scottish Government therefore did not have the power to change or expand the legal meaning of “woman” through guidance

Why did it go to the Supreme Court?

The case ultimately reached the UK Supreme Court because it raised important constitutional and legal questions about:

• Who has the power to define protected characteristics
• Whether devolved governments can reinterpret UK-wide equality law
• How sex and gender reassignment interact under the Equality Act

What did the Supreme Court decide?

The Supreme Court agreed with For Women Scotland and ruled that:

• The word “sex” in the Equality Act 2010 means biological sex
• The Scottish Government guidance was unlawful
• The guidance went beyond what the Scottish Parliament was legally allowed to do
• Any change to the meaning of “sex” or “woman” in equality law would have to be made by the UK Parliament, not through devolved guidance

Why does this matter in practice?

The decision means that:

• Public bodies must apply biological sex when using sex-based quotas or protections
• Organisations must be careful not to blur:
  • sex (a protected characteristic), and
  • gender reassignment (a separate protected characteristic)
• Single-sex spaces, services and representation rules must be reviewed to ensure they comply with the Equality Act as interpreted by the courts

AB v Grafters Group Ltd (t/a CSI Catering Services Internation)

What area of law was this case about?

This case looked at sexual harassment at work and when an employer can be held responsible for behaviour that happens outside the usual workplace.

What happened?

AB was an agency worker who was travelling in a car with a colleague.
The journey had been arranged for work reasons – it was not a social trip or something organised privately. During the journey, AB was sexually harassed by the colleague. AB brought a claim, saying the employer should be legally responsible for what happened.

What did the Employment Tribunal decide first?

The Employment Tribunal accepted that:

• Sexual harassment did take place

However, it decided that:

• The employer was not legally responsible, because the harassment happened outside the normal workplace and was not “in the course of employment”

What did the Employment Appeal Tribunal say?

The Employment Appeal Tribunal (EAT) disagreed with that approach.

It said the tribunal:

• Focused too narrowly on where the incident happened
• Failed to properly consider the connection to work

The EAT made clear that:

• Something can still be “work-related” even if it happens:
  • off-site
  • during travel
  • outside normal working hours

Because of this, the case was sent back to be looked at again.

Why is this important?

The case confirms that:

• Employers can be legally responsible for harassment that happens:
  • during work-related travel
  • at work events
  • in situations arranged because of work
• Liability is about connection to work, not just location or time

What should you be doing going forward?

• Make sure harassment policies:
  • clearly cover work-related travel
  • apply to off-site and informal settings
• Train staff that:
  • workplace behaviour standards apply beyond the physical workplace
• Treat complaints seriously even where incidents occur outside normal working hours

Rice v Wicked Vision Ltd and Barton Turns v Treadwell

What area of law:
Whistleblowing – when an employee suffers detriment (negative treatment) or dismissal for making a protected disclosure.

What happened:

• Both employees (Rice and Barton) claimed they were dismissed because they blew the whistle (reported wrongdoing at work).
• They also tried to claim that the dismissal itself was a “detriment” under whistleblowing law.

What the courts decided:

• Employment Tribunal (ET) and Employment Appeal Tribunal (EAT) disagreed on whether dismissal counts as a “detriment.”
• Court of Appeal clarified:
  • Dismissal cannot also be treated as a detriment under s.47B of the Employment Rights Act if the claim is already an unfair dismissal claim under s.103A.
  • However, some older cases (e.g., Timis v Osipov) still guide tribunals, so the law is technically still complex.

Why this matters

• Whistleblowing claims are tricky – tribunals carefully separate claims of unfair dismissal from other detriment claims.
• Employers must be extra careful when dismissing someone who has made a protected disclosure.

Practical takeaways

• Always document decisions clearly before taking any disciplinary or dismissal action.
• It is advisable to seek HR/legal advice before dismissing employees who have raised whistleblowing concerns.
• Ensure whistleblowing policies are up-to-date and clear.

Miller v University of Bristol

What was this case about?

This case is about freedom of expression, protected beliefs, and when an employer can discipline or dismiss someone for things they say, particularly in an academic or public setting.

What happened?

Professor Miller was employed by the University of Bristol. During lectures and at public events, he made strong anti-Zionist statements. Some students and members of the university community complained that the comments were offensive and upsetting, particularly to Jewish students.

The University believed that:

• His comments caused harm to students
• They damaged trust and confidence
• They amounted to gross misconduct

As a result, the University dismissed him.

What did Professor Miller argue?

Professor Miller said that:

• His anti-Zionist views were philosophical beliefs
• Those beliefs are protected by equality law
• He was dismissed because of those beliefs
• The dismissal was therefore discriminatory and unfair

What did the Employment Tribunal decide?

The Employment Tribunal agreed with Professor Miller and found that:

• His anti-Zionist beliefs qualified as a protected belief under the Equality Act
• The University had not shown that dismissal was a proportionate response
• The dismissal was both discriminatory and unfair

This meant the Tribunal decided the University acted unlawfully in dismissing him.

Is the decision final?

No.

The University has appealed the decision, and the case is currently under review by the Employment Appeal Tribunal (EAT).

Why is this case important?

The case highlights that:

• Some controversial or unpopular beliefs can still be legally protected
• Employers cannot discipline or dismiss someone simply because of their beliefs
• Action taken against an employee for expressing a belief must be:
  • carefully considered
  • clearly justified
  • proportionate to the harm caused

Simple takeaways

Even where views cause offence, employers must be very careful when taking action if those views are connected to a protected belief.

What does this mean going forward?

Employers should:

• Distinguish between holding a belief and how it is expressed
• Consider whether less severe action could address the issue
• Balance:
  • freedom of expression
  • duties to protect others from discrimination or harassment
• Keep clear evidence of harm and decision-making

HR Connect and Legal Connect will continue to keep you updated as we move into 2026 regarding any changes to legislation and case law decisions, our HR and Legal Connect Masterclass series and Employment Rights Act Implementation and Training Service will also provide you with the skills and tools to continue to be compliant in light of forthcoming changes, as well as the areas addressed in these cases and any changing landscape we may see in 2026.