Top 5 recent workplace developments – June 2026

Here is our selection of key recent employment law developments for employers, HR professionals and in-house lawyers.

1. EHRC issues draft guidance on single sex spaces
2. Single sex toilets and indirect discrimination on grounds of sex as well as religion
3. EAT clarifies limits of belief protection in systemic racism 
4. Bonus discretion: when has entitlement “crystallised”?
5. Government consultations update: carers’ rights and zero hours reform 

1. EHRC issues draft guidance on single sex spaces

The draft updated EHRC Code of Practice for Services, Public Functions and Associations has been presented to Parliament, which, if implemented, will provide comprehensive guidance on complying with the Equality Act 2010 for service providers, public authorities and associations, and services provided to the public.  

The Code will be implemented unless Parliament rejects it.  It does not apply to private employers but may still be of some use to employers as a template of how it may be appropriate to respond to tricky issues around single sex services.

For service provision, the Code confirms that the Equality Act permits single sex services where restricting provision to one sex is a proportionate means of achieving a legitimate aim, and specified conditions are met, such as where only that sex needs the service or where a mixed sex service would be insufficiently effective without a single sex provision. Organisations should justify decisions with evidence, rather than making assumptions and consider whether less intrusive alternatives or a mix of services could achieve the same aim without undermining the service.

For toilets and similar facilities, the draft Code explains that separate-sex provision based on biological sex may be justified but also encourages providers to consider mixed-sex alternatives such as individual lockable rooms. It also says that for necessary services such as toilets, it is very unlikely to be proportionate to leave a trans person without access. Providers should therefore consider providing a balance of mix of single-sex and mixed-sex provision.

The Code highlights that if a service provider admits trans people to a service intended for the opposite sex, such a service will no longer qualify as a separate sex or single sex service and it will not be able to rely on the single sex service exceptions under the Equality Act.

Practical point:

Overall, the message for public-facing organisations is that single sex services can be appropriate where proportionate and justified but that ideally mixed-sex services are provided alongside.

Providers should also follow the Code recommendation to have a policy explaining whether and how separate or single-sex services will be provided, recording the evidence and reasons for decisions.

Equality Act 2010: Draft Code of Practice for services, public functions and associations, 2026 - GOV.UK

2. Single sex toilets and indirect discrimination on grounds of sex as well as religion

In the latest case on single-sex spaces, a female Muslim employee challenged NHS England on its policy of permitting access to toilets and changing rooms based on gender identity.

The claimant was a Muslim female NHS England employee who also suffered from PTSD linked to past male sexual violence and held gender critical beliefs.  She challenged NHS England’s Trans Equality Policy and Procedure, which allowed trans employees to use single sex facilities (toilets and showers) corresponding to their gender identity. The claimant argued that this provision placed women, and particularly those with religious modesty concerns or trauma related to male violence, at a disadvantage and created an objectionable working environment.  She brought claims for indirect discrimination in relation to sex, religious belief and disability as well as harassment.

The Employment Tribunal rejected her complaints related to her religious belief and disability but upheld her claim of indirect sex discrimination, finding that although NHS England had a legitimate aim (inclusion of trans employees), it failed to demonstrate that the policy was a proportionate means of achieving that aim. NHS England could not show sufficient balancing of the competing rights of women affected by the policy. The Tribunal also upheld the claimant’s harassment claims, concluding that whilst both (i) the operation of the policy (allowing access in practice) and (ii) the wording of the written procedure did not have the purpose of violating the claimant’s dignity or creating an offensive environment linked to her sex and gender critical beliefs, it did have that effect. 

It’s worth noting that the Tribunal confirmed that in the Workplace (Health, Safety and Welfare) Regulations 1992 (which requires that separate rooms containing conveniences should be provided for men and women except where and so far as each convenience is in a separate room the door of which is capable of being secured from inside) references to “men” and “women” referred to biological men and biological women.

Practical point:

Employers should:

• Evaluate policies to ensure that they are balanced and proportionate and be aware that harassment can arise from the effect of a policy, even if the purpose was legitimate. 
• Take concerns raised seriously and respond appropriately.
• Where possible, provide single-sex facilities alongside all-access facilities, to cater for all employees.

LS v NHS England

3. EAT clarifies limits of belief protection in systemic racism 

New case clarifies the need for a clear link between a protected belief and the manifestation of that belief.

Mr Garrett was a white British ambulance crew member who brought a claim for direct discrimination based on his beliefs.  During a heated argument with a black colleague, he used the term “roadman” and subsequently he was overheard to comment that he did not believe in the concept of systemic racism, prompting an employee complaint.  Mr Garrett was disciplined, with the Trust finding that his conduct was inappropriate.  He was issued with a final written warning and required him to complete unconscious bias training, a black allyship workshop and a written reflective practice.

Mr Garrett brought Employment Tribunal claims alleging that he had been discriminated against on the grounds of: a) his philosophical belief that all people should be treated equally regardless of race (manifested by his rejection of systemic racism); and b) his race. 

The Tribunal agreed that Mr Garrett held a protected philosophical belief, which he manifested by rejecting the concept of systemic racism. It also agreed that his employer’s failure to interview a key witness, properly engage with his evidence and imposing the reflective practice amounted to direct race discrimination. 

The EAT disagreed with the ET’s approach, finding it had made an error in treating a rejection of systemic racism as a permitted manifestation of protected belief in equal treatment.  The EAT highlighted that a person could believe in equal treatment, whether or not they accepted the existence of systemic racism. 

The EAT also accepted that the employer had a non-discriminatory basis for its actions. The disciplinary findings were rooted in the claimant’s conduct, particularly the offensive way he spoke to colleagues, rather than his beliefs themselves and the Tribunal had wrongly inferred discrimination. 

Practical point:

Belief in equal treatment can be protected but bear in mind that not all conduct linked to a belief is protected. There must be a close link between the belief and its manifestation.

An employer can lawfully take action in response to offensive or inappropriate conduct, even if it is belief-related.  However, employers should ensure that disciplinary decisions are supported by clear, evidence-based non-discriminatory reasons. 

London Ambulance Service NHS Trust v Garrett [2026] EAT 77

4. Bonus discretion: when has entitlement “crystallised”?

This recent case illustrates the importance of having clearly defined parameters for performance related pay.

Mr Chandrashekarappa worked in a sales role at Wipro and attended an internal presentation announcing a discretionary “kitty bonus” of up to 1% of revenues from new business, subject to approval from the relevant sector lead. He secured a major contract and the sector lead approved a proposal that he receive the full 1% bonus.

Several weeks after that approval, a different senior manager introduced additional bonus requirements for the bonus scheme: executive sign off and a cap of $150,000. In December 2020, Wipro told Mr Chandrashekarappa that his bonus would be subject to that cap. He argued that he was entitled to the full 1% on first year revenues, which exceeded £500,000 and he brought a claim for unlawful deduction from wages in the Employment Tribunal. 

The Tribunal dismissed his claim, accepting his employer’s argument that the sector lead’s approval did not result in a legally binding entitlement and that this only arose after the introduction of the bonus cap and additional approval requirements. 

Mr Chandrashekarappa appealed to the Employment Appeal Tribunal (EAT), which agreed with him, finding that there had been an unlawful deduction from his wages.  Instead, the EAT concluded that Mr Chandrashekarappa’s bonus entitlement was not subject to the additional approval requirements introduced from December 2020. On a proper analysis, Wipro had set out the terms of the bonus scheme at the outset, which Mr Chandrashekarappa had fulfilled and the sector lead had validly exercised his discretion to award the full bonus. At that point, Mr Chandrashekarappa’s entitlement had crystallised. It was not open to the employer to ‘move the goalposts’ by imposing new conditions or a cap that had not formed part of the scheme when the relevant decision was made.

Practical point:

This case confirms that discretionary does not mean risk-free. Once discretion has been exercised in line with the scheme rules, a binding entitlement may arise. Employers cannot then retrospectively add caps or additional approval stages to reduce the payout. 

The key is to get the scheme right from the outset and ensuring everyone involved understands the applicable conditions, limits and approval requirements.  Senior management must also be clear that their decisions may create enforceable rights.

Chandrashekarappa v Wipro Ltd [2026] EAT 73 

5. Government consultations update: carers’ rights and zero hours reform

The Government has launched further consultations, focusing on support for unpaid carers and the regulation of zero hours and low hours working arrangements. 

Carer’s leave reform: a new consultation considers whether existing support for unpaid carers remains sufficient. Currently, employees are entitled to five days’ unpaid leave per year. The Government is seeking views on whether this should be extended and how best to support carers to stay in or return to work.

Three main options are proposed: (i) increasing the unpaid leave entitlement; (ii) introducing a “right to return” modelled on maternity leave, providing job protection during longer absences; and (iii) creating a new entitlement to paid carer’s leave. The consultation also considers different payment models, ranging from between 90% of pay down to rates aligned to statutory sick pay. In addition, “Hugh’s Law” proposals would introduce leave and financial support for parents following a child’s serious illness diagnosis. The consultation closes on 1 September 2026.

Zero hours and low hours reform: separately, the Government is consulting (until 25 August 2026) on how the ERA’s zero hours reforms will operate in practice. The aim is not to abolish zero hours contracts, but to address “one sided flexibility” while preserving genuine business need.

The key proposal is a right to guaranteed hours for workers on zero hours contracts or on contracts below a specific hours threshold, who regularly exceed their contracted hours over a reference period. The Government’s preferred approach is a threshold of 8–20 hours per week and a 12 week reference period, although both remain open for consultation.  The consultation highlights how technically complex this area would be to regulate, with issues under consideration including how to calculate guaranteed hours and how exceptions should apply to seasonal or temporary work.

The consultation also covers new rights for eligible workers to be given to reasonable notice of shifts and compensation for shifts cancelled or changed at short notice, with different options for notice periods and payment levels.  Note that agency workers are in scope, and enforcement is likely to involve both employment tribunals and the Fair Work Agency, with financial penalties for non compliance.

Practical point:

These consultations point to increased statutory rights for carers and enforceable rights for those in more insecure work.  There remains, however, a lot to be decided in the operational details on both these topics, and we will keep you updated with the changes.