Ask a UK practice owner what has consumed 2026 and the answer is predictable: quarterly updates, AML supervision, agent account security. Meanwhile a second wave of change has been landing quietly on the same clients, and it arrives through payroll rather than through HMRC.
The Employment Rights Act 2025 received Royal Assent in December 2025 and is being switched on in phases across 2026 and 2027. Several measures are already live. Two more land this October. The biggest one, a cut to the unfair dismissal qualifying period, applies to dismissals from the 1st of January 2027. If your firm runs payroll, prepares management accounts for owner managed businesses, or is simply the first person a client phones when something goes wrong, this is your inbox in the making.
Since the 6th of April 2026 your employer clients have been operating under a materially different set of rules:
The practical point for practices is that sick pay is no longer a rounding error. A client with twenty staff on modest or variable hours has just seen the cost and the administrative burden of short absences rise, and the data behind it now needs to survive inspection.
October 1st 2026: the time limit for bringing an Employment Tribunal claim doubles from three months to six months. For breach of contract claims in Scotland the change takes effect on 9 November 2026. Longer exposure means employers must retain payroll, absence and disciplinary records for longer, and be able to reconstruct what was paid and why, many months after an exit.
October 30th 2026: employers must take all reasonable steps to prevent sexual harassment of their employees, and must not permit harassment of their employees by third parties. The same date brings the duty to inform workers of their right to join a trade union, strengthened union access rights, and new protections for union representatives.
Strengthened tipping law also arrives by the end of 2026, which matters if you act for hospitality, hair and beauty or food service clients where tronc arrangements run through payroll.
For dismissals from the 1st of January 2027 the unfair dismissal qualifying period falls from two years to six months, and compensatory awards become uncapped. New protections restricting fire and rehire arrive at the same time.
Two years of service has been the informal safety net for small employers for a generation. Removing most of it changes how quickly hiring mistakes must be identified and handled, and it changes the risk profile of every probation conversation. Beyond that, 2027 brings guaranteed hours and reasonable shift notice for zero and low hours workers, regulation of umbrella companies, reform of flexible working, bereavement leave including pregnancy loss, a new collective consultation threshold and enhanced dismissal protections for pregnant women and new mothers. Timings for the guaranteed hours regime will be confirmed after consultation.
Accountants are not employment lawyers, and nobody should be drafting dismissal advice outside the scope of their engagement letter or professional indemnity cover. But three pieces of this sit squarely inside what a practice already does well.
2026 has trained the profession to watch HMRC. The Employment Rights Act is a reminder that a client's biggest unbudgeted cost this year may arrive from a different department entirely. The measures are published, the dates are fixed, and the first of them is a fortnight away. Firms that raise it now look prepared. Firms that wait until a client is already in a dispute look reactive.
Start with the client list. Everything else follows from knowing which of your clients employ people, and how well they can prove what they paid them.