Top 5 recent workplace developments - February 2026

Stay informed with our roundup of the latest employment law developments.

1. Unfair dismissal: Reforms
2. Employment Rights Act 2026: Timetable for implementation
3. Flexible working: Consultation published
4. COT3: Future claims
5. Disability discrimination: Substantial and long-term adverse effect

1. Unfair dismissal: Reforms

The Government has confirmed when the unfair dismissal reforms will come into effect. 

The Government has confirmed two important points relating to the timeline for implementation of the unfair dismissal reforms:

• When the qualifying period for unfair dismissal claims is reduced to six months on 1 January 2027, this will apply immediately meaning that any employee who has already reached six months’ service on that date will benefit from unfair dismissal protection straight away. 
• The cap on compensation for unfair dismissal claims will be removed from 1 January 2027 and will apply to dismissals with effect from that date.

Whilst we were expecting this to be the case, it is helpful to get confirmation of the precise timings for these changes, which underlines the importance of employers taking action now to mitigate the impact of the changes. 

Practical point

There are a number of practical steps employers can take to get ready for these changes. For example, strengthening recruitment, pre-employment screening and onboarding processes, updating employment contracts, policies and procedures, tightening up probation management and training staff. Employers should also be reviewing existing employees who will gain unfair dismissal rights from 1 January 2027 to ensure they are suitable for ongoing employment, especially those who start on or after 1 July 2025.

For more information, please read our detailed update or get in touch with your usual Clyde & Co contact who can talk you through how to get prepared.

2. Employment Rights Act 2026: Timetable for implementation

The Government has published an updated timeline for the implementation of their workplace law changes under the Employment Right Act. 

Mostly, the planned dates for implementation of the Employment Right Act continue to be those outlined previously, but there are a couple of changes to the original timeline. These include:

• The new restrictions on ‘fire and rehire’ dismissals which were originally planned for October 2026 will take effect in January 2027.
• The introduction of electronic and workplace balloting for statutory trade union ballots which was originally planned for April 2026 has been delayed until August 2026.

Separately, the Government has launched consultations on various measures being introduced by the Employment Rights Act 2025 – including ‘fire and rehire’, trade union recognition, flexible working requests, and employer policies on tipping. The flexible working consultation (considered next) closes on 30 April; and the remaining three close on 1 April. 

The Government is also consulting on the regulation of the temporary recruitment sector, including umbrella companies. This is in addition to measures being introduced on 6 April 2026 to tackle umbrella company tax non-compliance by making the UK agency that supplies workers to an end-client (or if there is no UK agency or the UK agency is connected to the umbrella company, the end-client) jointly and severally responsible for the PAYE liabilities of the umbrella company that employs the worker.

The new “fire and rehire” protections will make it automatically unfair for an employer to dismiss an employee either because they did not agree to a “restricted variation” of their contract of employment or in order to re-engage them or replace them with someone else to carry out substantially the same duties under a varied contract of employment (including at least one “restricted variation”). The consultation on “fire and rehire” focuses on the scope of “restricted variation” for the purposes of the new protections. 

It seeks views on what type of contractual changes to employment expenses, benefits and payments in kind, share schemes and shift patterns, should constitute "restricted variations" for the purposes of the new right not to be automatically dismissed for failing to agree to a restricted variation. The Government’s stated preference is for all expenses and benefits to be excluded and for significant shift changes to be included, for example, changes from day to night working / weekday to weekend working (or vice versa).

Practical point

It is helpful for employers to have some additional time to prepare for the fire and rehire changes and the introduction of e-balloting. Once the consultations have completed, more information will become available on the detail of the Government’s proposals for changes in these areas. We can help you get prepared for the significant changes ahead, please get in touch with us.

3. Flexible working: Consultation published

On 5 February 2026, the Government published its consultation on improving access to flexible working.

The Employment Rights Act 2025 introduces significant reforms to the statutory flexible working framework, including a ‘reasonableness’ test, the requirement to explain why a refusal is reasonable and a mandatory consultation process. These changes are expected to take effect in 2027.

The Government consultation seeks feedback on a proposed statutory consultation process that employers would be required to follow before refusing a statutory flexible working request. The proposed steps include:

• Holding a meeting with the employee, ideally within six weeks of the request
• Providing advance notice of the meeting’s purpose
• Engaging in meaningful discussion of the request and any potential alternatives
• Ensuring an authorised decision maker attends, keeps a record, identifies any reasonable adjustments considerations, explains the business challenges and explores solutions including trial periods)
• Considering any feasible alternatives
• Providing written confirmation of the outcome and final decision

The consultation also invites feedback on how the current regime is working in practice and how access to flexible working can be improved. It also seeks views on the training, resources and support employers may need. 

Practical point

The proposed reforms are intended to increase the likelihood of flexible working requests being approved and create a more transparent and consistent process for employers and employees. 

For more information about the proposed changes to flexible working and what this means for employers, please see our detailed update.

4. COT3: Future claims

The Employment Appeal Tribunal has ruled that a COT3 barred a future whistleblowing detriment claim based on the same the protected disclosures. 

Mrs Darlington raised safeguarding issues while employed by the London Borough of Islington (Islington) at Hargrave Park School (Hargrave). She said these were protected disclosures. After leaving, a job offered to her from another Islington-operated setting was withdrawn following a negative reference, which Mrs Darlington said was whistleblowing detriment.

This led to a claim and a COT3 settlement being reached, under which the reference was withdrawn and a new one provided. The agreement was drafted widely, settling “all existing and future claims” against Islington and the school, including claims arising after the agreement, and all claims under the Employment Rights Act 1996.

After the COT3 had been signed, a subsequent job application by Mrs Darlington was also unsuccessful despite the provision of the new reference. Mrs Darlington brought a fresh whistleblowing detriment claim, relying on the same disclosures. An Employment Tribunal found that the COT3 barred this claim. Mrs Darlington appealed to the Employment Appeal Tribunal (EAT). 

The EAT decided that the intention of the COT3 was to settle all existing and potential future claims against Islington arising from Mrs Darlington's allegation that she had made protected disclosures while employed at Hargrave and, as a result, was subject to detriment. The wording "whether arising from her employment with the Employer, its termination or from events occurring after this agreement" was clearly intended to exclude claims of future alleged detriment causally connected to the same previously alleged protected disclosures. 

Viewed objectively, the agreement was intended to settle all claims - past and future - arising out of the alleged protected disclosures, including later alleged detriments. The wording clearly covered events occurring after the agreement, and there was no basis to limit its effect to one particular school or role, or point in time.

Practical point

The decision confirms that a carefully drafted COT3 can bar future whistleblowing detriment claims based on the same protected disclosures, even if the new detriment happens later or in a different context. If the intention is to cover all whistleblowing issues arising from particular disclosures, the agreement should say so in clear terms, including language about future claims, claims arising from future events, and reference to the Employment Rights Act.

While the employer succeeded here, HR should still ensure post-settlement recruitment and referencing decisions are well-documented and defensible to avoid disputes escalating in the first place. 

Darlington v London Borough of Islington

5. Disability discrimination: Substantial and long-term adverse effect

A recent Employment Appeal Tribunal decision considers a disability discrimination claim brought by an employee with endometriosis.

Ms Pal worked for Accenture from 2009 to 2019, progressing from analyst to manager. In 2018–19 she experienced significant ill health and underwent surgery for endometriosis. Although she returned to work on a phased basis, her employment was terminated a few months later. 

She subsequently brought claims for unfair dismissal and discrimination arising from disability. To succeed in her disability claim, she needed to show that her endometriosis had a substantial and long-term adverse effect on her day-to-day activities.

The Tribunal upheld Ms Pal’s unfair dismissal claim but dismissed her disability discrimination claim.

On appeal, the EAT found that the Tribunal had failed properly to assess whether she was disabled. It had discounted her evidence, overlooked supporting medical evidence and relied on irrelevant comments about other women’s experiences of endometriosis.

The EAT also said that absence from work due to treatment can itself amount to a substantial adverse effect on day-to-day activities.

The case will now be re-considered by a differently constituted Tribunal.

Practical point

Endometriosis may be a disability where it has a substantial and long-term adverse effect on an individual’s normal day-to-day activities. When assessing disability, the focus should be on the actual impact of the condition on the individual, taking proper account of their own evidence and any supporting medical evidence. 

Pal v Accenture UK Ltd