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On 15 April 2026, the Home Office published a consultation and draft updated Code of Practice on avoiding unlawful discrimination while preventing illegal working. The draft Code does not change the law immediately however it sets out how employers will be expected to comply with their obligations in future.

Whilst there are currently a growing number of employment‑related consultations taking place in Great Britain that do not extend to Northern Ireland, the obligation to carry out right to work checks is a UK‑wide requirement, and employers in Northern Ireland should be aware of a new Home Office consultation that will apply here if approved.

If approved, the draft Code will apply on or after 1 October 2026 to:

  • all new employment checks
  • any repeat right to work checks on existing workers where those checks are carried out on or after that date to retain a statutory excuse.

Until then, employers must continue to comply with the current Right to Work Code of Practice, which has been in force since February 2024.This draft Code reinforces the need for right to work checks to be carried out:

  • At the same stage of recruitment or engagement for all applicants or workers
  • In a consistent manner, regardless of whether checks are done manually, online, or through an external service provider

Employers using different checking methods must ensure that these do not result in different treatment for different groups of workers.

One of the most significant changes in the draft Code is the introduction of formal definitions of “employer” and “worker”. These definitions are intended to cover:

  • Employees
  • Workers
  • Individual sub‑contractors
  • Individuals engaged via online matching services and platforms

This reflects the direction of travel under the Border Security, Asylum and Immigration Act 2025, which, once commenced, will extend the illegal working regime to organisations engaging people in the gig economy or on zero‑hours arrangements.

Employers who rely on contractors, agency staff, or platform‑based working arrangements should therefore pay particular attention.

Penalties for non-compliance with the prevention of illegal working rules includes fines of up to £45,000 for a first offence, and up to £60,000 per illegal worker for repeat breaches. Failure to conduct checks properly can also impact on any Sponsor Licence. It will therefore be important for businesses to understand their obligations

The consultation is open for a short two‑week period and closes on 29 April 2026.

 

As we close out the first quarter of 2026, several noteworthy legislative and regulatory changes have already taken effect, with more anticipated as the year progresses. Below is a summary of the main updates that Members should note.

LEGISLATIVE UPDATES 

Pension Auto Enrolment

From 1 January 2026, Ireland’s new Pension Auto‑Enrolment scheme (My Future Fund) officially launched. Eligible employees aged 23–60, earning €20,000+ and without an existing workplace pension were automatically enrolled.

Initial contributions started at 1.5% from employees, matched by 1.5% from employers, with an additional 0.5% State top‑up. The scheme is centrally administered by the National Automatic Enrolment Retirement Savings Authority (NAERSA) and is designed to improve retirement savings alongside the State Pension.

Employees must remain in the scheme for six months before they can opt out, with contribution rates set to increase gradually over time.

Employers who already operated a qualifying workplace pension before January 2026 were not required to auto‑enrol those members into My Future Fund.

  • Employees actively contributing to an existing scheme were excluded from auto‑enrolment
  • Existing schemes had to meet minimum contribution standards(including an employer contribution)
  • Employers needed to assess their workforce, identifying which employees were covered and which were not
  • Employees not in the existing scheme (or not eligible to join it) were auto‑enrolled into My Future Fund

As a result, many employers now operate dual arrangements: an existing pension scheme for some employees, alongside My Future Fund for others.

National Minimum Wage

From 1 January 2026, the National Minimum Wage increased to €14.15. This change signals the Government’s ongoing intention to move towards a living wage, and it carries immediate implications for both costs and compliance across all employers.

Employment Permit Salary Thresholds

Effective 1 March 2026, minimum salary thresholds for employment permits have risen. General Employment Permits now require a minimum salary of €36,605 (up from €34,000), while Critical Skills Employment Permits demand €40,904 (previously €38,000).

Remote Working

The Government’s public consultation on remote working closed on 9 December 2025, drawing over 8,000 submissions—primarily from employees. The statutory review that followed confirmed a 94% approval rate for employee requests (either in full or in part) and found the legislation is functioning well, contrary to some media reports. Employers report a manageable administrative burden, but the review highlighted low awareness and uptake, especially in rural areas. To address this, the Government will launch a targeted national awareness campaign. The Workplace Relations Commission has also been asked to revise and strengthen the Code of Practice, providing clearer guidance and practical templates. No legislative amendments are planned at this stage.

Employment (Contractual Retirement Ages) Act 2025

The Employment (Contractual Retirement Ages) Act 2025 will, when enacted, enable employees to formally notify their employer that they do not consent to retire at the contractual retirement age if it is below the State Pension Age (66).

The Act was signed into law on 16 December 2025. No commencement date has been set. It will only come into force once the government issues a commencement order. A Code of Practice is expected, and commencement is anticipated after its publication.

Employees will be entitled to notify their employer if they do not consent to retire at a contractual retirement age below 66, with employers required to objectively justify any lower retirement age and issue a reasoned written response within one month, failing which claims may arise before the Workplace Relations Commission and, in some cases, criminal penalties may apply.

Employers should prepare for new notification-handling procedures for employees wishing to work until 66, ensure they can objectively justify any contractual retirement age below 66, and update policies, contracts, and HR processes ahead of the Act’s commencement.

 Pay Transparency Directive

The Government has acknowledged that Ireland will miss the 7 June 2026 deadline for implementing the EU Pay Transparency Directive, opting for phased implementation instead.

The Department of Children, Equality, Disability, Integration and Youth has clarified that employers won’t be penalised for not having all elements in place by June. The General Scheme of the Equality (Miscellaneous Provisions) Bill 2024, published in January 2025, covers several recruitment-related aspects, such as salary ranges in job advertisements and restrictions on pay history questions. Further legislation will address outstanding obligations, including gender pay gap reporting. Meanwhile, the European Commission has issued updated guidance on gender-neutral job evaluation and classification to help employers prepare for future compliance.

Code of Practice on Access to Part-Time Working (2026)

On 22 January 2026, the Government approved a refreshed Code of Practice on Access to Part-Time Working, replacing the previous version. The updated WRC Code doesn’t create new legal duties but reinforces best practice for handling part-time work requests. It encourages consideration of part-time arrangements at all organisational levels—including senior roles—strengthens protections against penalisation, and underscores the importance of accommodating parents’, carers’ and employees’ medical needs. Employers should proactively assess whether roles can be performed on a part-time basis.

These updates highlight the need for ongoing review of policies, pay structures, and working practices throughout 2026.

CASE LAW UPDATE

  1. SK Biotek Ireland Ltd v Shannon Reina (SLD262)– Operation of Statutory Sick Pay 

Background 

The Complainant, a Quality Control Analyst at SK Biotek, worked from August 2023 until her resignation in July 2024. She had several certified sickness absences, including COVID-19 and a work-related injury. SK Biotek operated an internal sick pay scheme whereby after a six-month qualifying period, employees could receive full pay for up to four weeks per year, plus 50% for a further four weeks, subject to compliance with their Absence Management Policy. The Complainant received a verbal warning due to the level of absence and became disentitled to company sick pay.

In May 2024, the Complainant applied for sick pay again and was refused under the company scheme. She then lodged a claim with the Workplace Relations Commission (WRC) under the Sick Leave Act 2022, contending that she was entitled to statutory sick pay when she lost access to the company scheme.

WRC Decision

The adjudicator upheld the Complainant’s complaint. The AO found that she was entitled to statutory sick leave, despite the employer withholding sick pay under its own policy. The Respondent appealed to the Labour Court.

Labour Court Decision 

The Labour Court examined whether SK Biotek’s more generous internal scheme exempted it from statutory obligations under section 9(1) of the Sick Leave Act. The court confirmed that:

  • Both parties agreed SK Biotek’s scheme was, as a whole, more favourable than statutory rights.
  • Eligibility conditions or disciplinary disqualifications were not relevant to the exemption analysis.
  • Section 9(1) provides an absolute exemption from statutory sick pay, even if the employee becomes ineligible due to disciplinary action.

The Labour Court overturned the WRC’s award and ruled that SK Biotek had no obligation to provide statutory sick pay, setting aside the €500 compensation.

Key Takeaways for Employers

This decision confirms that employers may lawfully apply conditions to their occupational sick pay schemes. Where an employee does not qualify for company sick pay, there is no obligation to pay statutory sick leave provided the company scheme is exempt under section 9 of the Sick Leave Act. While the outcome may be viewed as harsh (particularly given that the complainant’s absences were certified and gen) it aligns squarely with the statutory framework. The Act makes clear that contractual sick pay and statutory sick pay do not operate in parallel; entitlement is to one or the other. As the Labour Court stated, section 9 “admits of no exceptions to this exemption and does not confer any discretion on this Court to imply any such exception into it.”

  1. Mick Kiely v Hyph Ireland Ltd (ADJ-00037708) – Constructive Unfair Dismissal. 

In a landmark decision, the Workplace Relations Commission (WRC) has made the highest unfair dismissal award in its history, granting compensation of approximately €464,000 to a former senior executive.

Background 

The Complainant , Mr Mick Kiely, the founder, CEO and chairperson of Hyph Ireland Ltd (formerly Xhail Ireland Ltd), was dismissed in November 2021 without notice or any disciplinary or dismissal procedure. His employment was terminated abruptly by email, and he was immediately locked out of company systems.

WRC Decision

The WRC found that the employer had failed entirely to follow fair procedures, amounting to a clear breach of the Unfair Dismissals Acts. The adjudication officer rejected the employer’s justification for the dismissal and accepted that Mr Kiely had been denied basic procedural fairness.

In assessing compensation, the WRC placed significant weight on:

  • Mr Kiely’s senior executive role and high remuneration
  • The absence of any warning or due process
  • A restrictive non‑compete clause, which substantially limited his ability to mitigate his losses by obtaining alternative employment

The WRC awarded €440,000 for loss of earnings, and €24,000 in pay in lieu of notice, bringing the total award to €464,000.

The case has attracted considerable attention as it illustrates the potential scale of exposure for employers, particularly where senior employees are dismissed without due process. It also serves as a stark reminder that failures in procedure alone can justify substantial compensation, even where an employer believes there were substantive grounds for dismissal.

  1. O ‘Connell v National Council for Special Education (ADJ‑00042837) – Disability Discrimination, WRC Lifts Statutory Cap in Non- Appointment Case

In a recent Workplace Relations Commission (WRC) decision, Noel O’Connell v National Council for Special Education (ADJ‑00042837), the WRC found that the National Council for Special Education (NCSE) had indirectly discriminated against a deaf applicant in a recruitment process. The case is particularly noteworthy as the Adjudication Officer disapplied the statutory €13,000 compensation cap for access‑to‑employment discrimination claims, instead awarding €40,000 in compensation.

Background

In March 2022, the complainant—who is deaf and a native user of Irish Sign Language (ISL)—applied for the role of Advisor Deaf/Hard of Hearing (ISL) with the NCSE. Eligibility criteria included holding a formal ISL qualification and demonstrating excellent oral communication skills. As is common for native sign language users, the complainant did not hold a formal academic ISL qualification, and the application was rejected.

Following an internal review, the NCSE accepted that the complainant met the essential criteria for the role. However, the recruitment process for the role was not reopened and no remedy was offered.

Decision

The Adjudication Officer held that the NCSE’s requirements amounted to indirect discrimination and that the complaint was well founded. In considering redress, the Adjudication Officer examined section 82(4) of the Employment Equality Act 1998, which caps compensation at €13,000 in access‑to‑employment cases.

The Complainant successfully argued that this cap conflicted with EU law—specifically Article 17 of Directive 2000/78, which requires sanctions to be effective, proportionate and dissuasive. Reliance was also placed on Case C‑378/17 (Minister for Justice and Equality v Workplace Relations Commission), where the CJEU confirmed that bodies such as the WRC must disapply national provisions that are incompatible with EU law.

Applying these principles, the Adjudication Officer disapplied the national compensation cap and awarded €40,000.

Key takeaway for employers

This decision signals a clear willingness by the WRC to set aside domestic compensation limits where they fall short of EU law requirements. Employers should be prepared for robust challenges to the €13,000 cap in access‑to‑employment discrimination claims and, potentially, arguments seeking to disapply other statutory compensation caps where more effective and dissuasive remedies are deemed necessary.

 

 

Employers Federation Northern Ireland is celebrating 160 years of supporting employers across Northern Ireland, building on a long tradition of advice, representation and practical help for businesses and organisations.

The Federation was originally formed in May 1866 as the Belfast Engineers, Shipbuilders, Founders and Machine Makers’ Association. It was established by some of Belfast’s leading industrial employers at the time, including Harland and Wolff, to share information, provide mutual support and respond to employment relations challenges.

The milestone year also comes at a time of change for the Federation. It comes following the unexpected death of Peter Bloch, who led the organisation with commitment, integrity and deep care for members and staff for 35 years. Under Peter’s leadership, Employer Federation strengthened its legal support for employers—helping companies and organisations of all sizes, across every sector, to deal with complex and often sensitive workplace issues.

The Federation has now appointed its new Managing Director as Michelle McGinley. Michelle was previously Director of Legal & Policy and stepped into the role of Acting Managing Director following Peter’s death. She provided steady, thoughtful and highly effective leadership, ensuring continuity of service to members while supporting colleagues through significant change.  Michelle took up the role permanently in April 2026 and is the first female to hold the position in the Federation’s 160‑year history. She will work closely with Federation’s experienced team to build on the organisation’s values and continue delivering practical, trusted support for members.

Employers Federation will mark the 160th anniversary throughout the year as we look forward to the future.

Although most of the GB Employment Rights Act 2025 will not apply in Northern Ireland, SSP is a devolved matter, and the Department for Communities has confirmed that Northern Ireland will follow the same SSP reforms as Great Britain.

In light of this the SSP changes coming into effect on 6 April 2026 will apply to Northern Ireland.

How do the SSP rules currently operate in Northern Ireland?

SSP is currently paid from the 4th day of sickness absence at a flat weekly rate (£118.75 per week from 6 April 2025, reviewed annually).

To qualify, employees need to be earning more than the Lower Earnings Limit, which is currently £125 a week (reviewed annually).

What is changing from 6 April 2026?

The key changes are:

  1. SSP will be paid from the first full day of sickness, instead of from day 4. The current 3‑day waiting period will be removed;
  2. The Lower Earnings Limit will be abolished, meaning employees will qualify for SSP regardless of how much they earn;
  3. The SSP weekly rate will increase as part of the annual uprating cycle, rising from £118.75 to £123.25 per week from 6 April 2026.

These changes apply in Northern Ireland on the same timeline as Great Britain and represent the most significant reform to SSP in years.

The changes are explained in more detail in the Government Factsheet: Statutory Sick Pay (SSP)

What your Organisation needs to do

Removing the waiting days and the earnings threshold will mean more employees will qualify for SSP. It may also increase your levels of short‑term absence and the associated costs for your Organisation.

You should take steps now to prepare for the changes coming in April 2026 as follows:

  1. Update your payroll systems so SSP is paid from day 1 and at the new SSP rate;
  2. Review sickness absence policies to ensure they reflect day a SSP entitlement;
  3. Check attendance management procedures so managers follow them consistently, particularly for repeated short‑term absences;
  4. Brief and train managers on the new rules and re-inforce the importance of return‑to‑work interviews and of pro-active and consistent absence management;
  5. Assess the impact on part‑time and lower‑earning staff, who may now qualify for SSP for the first time;
  6. Audit the potential financial impact of the changes on your Organisation, including any knock‑on effects for enhanced sick pay schemes.

These SSP reforms sit alongside wider employment law changes expected under the forthcoming Good Jobs / Employment Rights Bill in Northern Ireland. However, SSP is one of the few measures being implemented ahead of the wider Bill.

Commentary

If your Organisation already provides contractual sick pay from day 1, the impact of these changes may be limited. However, if you currently pay SSP only, you will need to consider how these changes affect your policies, processes and day‑to‑day management of sickness absence. In particular, clear procedures and effective and consistent management of short term absence will be increasingly important.

 

 

 

The Data (Use and Access) Act 2025 (Commencement No 6 and Transitional and Saving Provisions) Regulations 2026 (SI 2026/82) (Regulations) were made on 29 January 2026 and bring into force specific provisions of the Data (Use and Access) Act 2025 (DUA Act) on 5 February and 19 June 2026, amending the UK GDPR and Data Protection Act 2018.

The DUA Act provides the ICO with new powers, including the ability to compel witnesses to attend interviews, request technical reports, and issue fines of up to £17.5 million or 4% of global turnover under the Privacy and Electronic Communications Regulations (PECR).

In particular employers should be aware of the following areas:

1. Data Subject Access Requests (DSARs)

  • Simplified process: Employers must respond to DSARs more efficiently, with clearer timelines and clarified the scope for extensions.
  • Clarity of refusal grounds: The DUA Act narrows the circumstances under which requests can be refused, requiring detailed justification.
  • Electronic access emphasis: Employees should be able to access their data digitally, with secure formats encouraged.

2. International Data Transfers

  • New transfer mechanisms: DUA Act introduces streamlined rules for cross‑border data transfers, replacing some of the older adequacy and safeguard models.
  • Recognised legitimate interests: Employers may rely on “recognised legitimate interests” for certain transfers, provided risks are assessed and documented.
  • Greater accountability: Organisations must demonstrate compliance through updated records and risk assessments when transferring employee data abroad.

3. Complaint Handling (In force from 29 June 2026)

  • Mandatory procedure: From 19 June 2026, all organisations must have a complaints procedure for data protection issues.
  • Transparency: Employees must be informed of how to raise complaints and the expected timelines for resolution.
  • ICO oversight: The Information Commissioner’s Office will monitor compliance, and failure to implement a procedure could lead to enforcement action.

In more detail: Data Subject Access Requests (DSARs)

In relation to subject access request (DSAR) in December 2025 the ICO published updated Guidance to reflect recent DUA Act amendments that essentially codified existing practice and ICO Guidance.

How organisations handle subject access requests is the ICO’s most complained of issue, so the purpose of the Guidance is to remind organisations of their responsibilities under the law.

In particular, the DUA Act and Guidance clarifies:

  • Searches in response to DSARs must be “reasonable and proportionate” – they do not required to conduct searches that would be unreasonable or disproportionate to the importance of providing access to the information.
  • Employers can “stop the clock” on the one‑month response deadline if further clarification is reasonably required from the data subject. Controllers must be able to demonstrate that clarification is genuinely necessary to provide an effective response. Clarification requests cannot be made on a blanket basis – only where reasonably required.
  • Extend time to respond by a further two months if the request is complex; or there are a number of requests from the same person. For example if the organisation requires any information to confirm the identity of the person the information is about or any information you request to confirm that the third party is authorised to act on behalf of the person; or
  • Clarifies the meaning of “manifestly unfounded” and “manifestly excessive” requests, aligning with DUA Act. The ICO emphasizes that this is a high threshold and we recommend that any organisation wishing to rely on this should first carefully read the Guidance and examples provided.

You can view the updated Right of Access guidance: here
In more detail: Updated ICO Guidance on International Data Transfers (9 February 2026)

On 16 January 2026, the ICO updated its guidance on international data transfers.

The previous Guide to International Transfers has now been broken down into more detailed, topic‑specific guides. This includes a new, expanded guide explaining when a transfer is considered “restricted”, who is responsible for complying with the rules, and how employers can meet their obligations under the UK GDPR.

You should pass this Guide to the persons responsible for data in your workplace if you transfer employee, customer, or client data outside the UK, or if you advise others on doing so.

What has Changed?

The ICO has:

  • Expanded its explanation of what is and isn’t a restricted transfer.
  • Introduced a clearer three‑step test.
  • Provided more practical examples.
  • Added new content on who is responsible for complying with transfer rules.
  • Clarified key responsibilities for organisations making international transfers.

The aim is to help organisations understand when the rules apply, how to make a restricted transfer, and who must comply.

The ICO has released two introductory videos to support the new guidance.

The first video focusses on What Is a Transfer and explains:

  • What counts as a restricted transfer.
  • Common questions about when the rules apply.
  • Who is responsible for complying with the transfer rules.
  • Practical scenarios to illustrate the principles.

Important note: In the video, step 2 of the three‑step test focuses on whether information is being transferred outside the UK. In the updated written guidance, the ICO has refined this. Step 2 now focuses on who is initiating the transfer to an organisation outside the UK. If your organisation is not initiating the transfer, then it is not a restricted transfer for you.

This is a helpful clarification for employers who rely on third‑party processors or cloud‑based systems.

The second video explains how to make restricted transfers in a compliant way. Employers must ensure that any transfer is covered by:

  • Adequacy regulations, or
  • Appropriate safeguards, or
  • A relevant exception.

For those who require further advice on this area, on 10 March 2026 the ICO is hosting a 1 hour webinar to support the launch of the updated guidance on international transfers.

In more detail: handing data protection complaints.

On 12 February 2026, the ICO published their final complaints procedure guidance, Under the DUA Act, organisations must have a clear and accessible process for handling data protection complaints by 19 June 2026.

A complaint can come from anyone who believes their personal information has been handled in a way that infringes data protection law and so having the right procedures in place is essential.
The new guidance adopts the now familiar wording used by ICO setting out what organisations must, should and could do to comply with the changes to the law. It includes practical tips and advice for each stage of the process to help DPOs and organisations build a robust approach.

The Guidance has been published early in advance of the obligation to have an effective complaints procedure becoming law on 19 June 2026.

Flexible Working Consultation

In Great Britain on 5 February 2026 the Government launched a further Consultation on improving access to flexible working.

This Consultation aims at introducing a new process for employers to follow if they think they might need to reject a flexible working request.

In Great Britain in April 2024, changes were made to the flexible working process to:

  • Make the right to request flexible working request a Day 1 right
  • Allow employees to make two statutory flexible working requests in a 12-month period, with a second request permitted once the first request has been fully determined or withdrawn.
  • Dispose of the requirement that employees must set out the potential impact of a flexible working request and how it could be accommodated
  • Requires the employer to consult with the employee about the change
  • Employers must demonstrate that they have acted reasonably in refusing any request

This further Consultation seeks views on:

  • a proposed new light touch process for employers consulting with employees where a request cannot be immediately agreed
  • what training, resources and support can help businesses navigate flexible working requests
  • other ways to improve access to flexible working

The majority of questions consultation focus on statutory requests, but it is also open to hearing about experiences of more informal arrangements.

This Flexible Working Consultation closes 30 April 2026 

The position in Northern Ireland (Flexible Working) 

In Northern Ireland the Department of Economy plans to introduce laws via primary legislation to level up employees right to request flexible working in the main to those that were brought into force Great Britain in April 2024. At present in Northern Ireland, employees are entitled to make a request after 26 weeks’ continuous employment (that it is not a Day 1 Right) and only permitted one request each 12-month period. Employees must also state the potential effect of their flexible working request.

When introduced the proposed changes in Northern Ireland will:

  • Make the right to request flexible working request will apply a Day 1 right
  • Permit employees to make two statutory flexible working requests in a 12-month period, with a second request allowed once the first request has been fully determined or withdrawn.
  • Dispose of the requirement that employees must set out the potential impact of a flexible working request and how it could be accommodated
  • Require the employer to consult with the employee about the change
  • Employers will have to demonstrate that they have acted reasonably in refusing any request

There are no current proposals in Northern Ireland to implement the further changes to flexible working that are being considered in Great Britain.

Agency Worker Consultation

On 6 February 2026, a further Consultation on modernising the Agency Work Regulatory Framework was opened.

In Great Britain the government believes that for too long employment law has failed to keep pace with fundamental changes to how, when and where individuals work. It states the Consultation seeks views on proposals to improve the framework that governs the temporary labour market and to strengthen protections for workers while at the same time minimising burdens on businesses.

The government recognises that although the Conduct Regulations were created to protect agency workers, they now place heavy administrative and operational burdens on recruitment businesses, requiring detailed contracts, extensive checks, and significant record‑keeping that can be costly and slow down a fast‑moving sector.

At the same time, the Consultation says that the current rules do not properly cover umbrella companies, leaving gaps in protection and creating an uneven playing field. The government believes this is the right moment to update and simplify the framework so that it reflects the modern labour market, focuses enforcement on real‑world harms, and allows businesses to operate without unnecessary or duplicative regulation.

This Consultation closes on 1 May 2026

The position in Northern Ireland

 Northern Ireland is consulting on proposals to bring its regulation of the temporary labour market broadly into line with the current position in Great Britain, including:

  • ending pay‑between‑assignments contracts
  • introducing the Key Information Document for agency workers and recruitment agencies.

The Department also intends to strengthen the role of the Employment Agency Inspectorate (EAI), which currently has limited powers to share information with other regulators.

New legislation would open information‑sharing gateways with appropriate bodies—an important step where safeguarding or risks to vulnerable people may arise. In addition, the Department plans to enhance the EAI’s enforcement powers by introducing Labour Market Enforcement Undertakings and Orders, mirroring tools already available in GB.

Most of these changes will require primary legislation, the Key Information Document could be introduced more quickly through secondary legislation.

Further information can be obtained from the Legal Team.

Creating Safer Workplaces Sexual Harassment course

END OF YEAR DEBRIEF 2025 – ROI Newsletter Issued copy

Effective Case Management of Complex Grievances

On 26 November 2025, the UK Government issued a Policy paper Working paper on options for reform of non-compete clauses in employment contracts inviting views on options to reform non‑compete clauses in employment contracts. These proposals are part of the wider mission to promote good jobs, boost productivity, and support a dynamic labour market.

Importantly, these proposals apply only in Great Britain (GB). There are no current plans under the Northern Ireland (NI) mandate to introduce similar reforms here. That said, NI often looks across at developments in GB, so future alignment could occur.

Case for Reform

The Paper states that non‑compete clauses restrict employees from joining competitors or starting their own businesses for a period of time after leaving a job. Their purposes is to allow business to protect legitimate business interests. However, evidence shows they can:

  • Limit worker mobility
  • Reduce knowledge sharing and innovation
  • Deter start‑ups and growing businesses from accessing talent
  • Create uncertainty for employees, even when clauses are unlikely to be enforceable

Surveys and research indicate that non‑compete clauses are common not only among high earners but also in lower‑paid roles.

Options under Consultation

There are four main policy options being considered:

  1. Statutory limit on length:
    • A maximum duration (previously suggested at 3 months).
    • Possible variation by company size (e.g., 3 months for large firms, 6 months for smaller firms).
  1. Complete ban
    • Non‑compete clauses would be unenforceable in all employment contracts.
  1. Ban below a salary threshold:
    • Clauses unenforceable for workers earning below a set salary level.
  1. Combination of statutory limit and salary threshold approach:
    • Ban below a salary threshold, plus a statutory limit (e.g., 3 months) for those above it.

Enforcement

The government is consulting on reforms to non‑compete clauses in GB, with options including a statutory time limit, a complete ban, a ban below a salary threshold, or a combination of these approaches. Currently, restrictive covenants are enforced through the courts, where the losing party pays the winner’s costs, which often deters employees from challenging clauses even when they are unlikely to be enforceable. This means workers may comply with overly broad terms out of fear of litigation. The government is therefore also seeking views on whether high legal costs are a barrier to contesting non‑competes and what changes might help rebalance the system.

Consultation

The consultation is open until 18 February 2026, and we will continue to keep members updated on any developments.

This is the first of what we expect will be 26 consultations affecting employment rights in Great Britain. Meanwhile, in Northern Ireland, we understand that the Department for the Economy is finalising drafts of the Employment Rights Bill, which is expected to be published in January. It is also noteworthy that the Minister for the Economy is scheduled to attend the Economy Committee on 7 January 2026, which is perhaps the date on which she will introduce the Bill to them.