Employment Rights Act 2025 - key impacts on the maritime industry

UK government data highlights that the maritime sector directly supported around 227,000 jobs in 2019, with an estimated 24,100 UK seafarers active in 2023.

The government has directed some of its latest employment law changes squarely at the maritime sector. We’ve collated the key elements below:

1. Collective redundancy obligations 

What are the UK’s rules on collective consultation for redundancies? 

Where an employer is planning to make more than 20 redundancies within a 90 day period at one establishment, they are obliged to collectively consult with employees about the proposed redundancies:

• 30 days before the first dismissal takes effect where 20–99 redundancies are proposed; or 
• 45 days before the first dismissal where 100 or more redundancies are proposed.

How does that apply to ships? 

As always with seafarers, the first question is whether the UK’s statutory rules apply at all. Where there is a sufficiently strong connection to Great Britain, collective consultation is required. The Court of Appeal in Seahorse Maritime Limited v Nautilus International 2019 clarified that when considering a maritime employer's collective consultation obligations, the focus should not be on whether the individual crew members have a sufficiently strong connection with Great Britain, but rather whether the establishment (i.e. each individual ship) had such a connection. This will be fact sensitive in each case, based on the operational and organisational realities, which might include where the vessel operates, or where the vessel owner or operator was based/incorporated. 

What notification requirements are there?

UK employers are required to notify the UK Secretary of State for Business and Trade if 20 or more redundancies are proposed at one establishment (or ship). However, until now, employers making crew redundant on ships registered outside Great Britain have been required only to notify their flag state and crucially, there was no financial penalty for failing to provide this notification, leaving a gap in enforcement. 

What is changing?

Notification requirements: From April 2026, marine employers with crew on ships operating regular international services calling at a Great Britain harbour 120 or more times per year or running domestic services between Great Britain and Northern Ireland must notify the UK Secretary of State of their proposed collective redundancies, even where the ships are registered outside Great Britain. This is important because a failure to notify the UK Secretary of State is a criminal offence and conviction may result in an unlimited fine.

Penalties for breach of consultation obligations: From 6 April 2026, if an employer does not comply with its collective consultation obligations, it will be subject to a ‘protective award’ of 180 days’ pay per employee, increasing from the previous maximum of 90 days’ pay per employee. This doubling of the penalty that can be awarded significantly increases the risks of getting this wrong. 

Calculating the minimum threshold of 20 employees for collective consultation: The UK government is consulting on plans to trigger collective consultation based on the total number of proposed redundancies across the organisation, rather than by reference to a single establishment (or ship). Although this is not yet law, current proposals suggest that the lowest organisation wide threshold under consideration is 250 redundancies (for example, 10 redundancies on each of 25 vessels). This change is likely to be introduced in 2027.

2. Limitations on “Fire and Rehire” and “Fire and Replace”

Responding to global challenges by making contractual changes to employment contracts will become riskier for employers subject to UK laws. From January 2027, dismissals used as a mechanism to impose changes to key contractual terms - such as pay, working hours, pensions, shift patterns and time off - will be automatically unfair, including where employers seek to replace employees or introduce new flexibility clauses covering those terms. Compensation for unfair dismissal is uncapped and employees have this protection from 6 months’ employment.

Crucially, in direct response to the well-known issue with P&O, the ban also extends to “fire and replace” practices, where employees are dismissed and replaced with contractors or agency workers.   

A narrow exception will apply where dismissals are genuinely necessary due to serious financial difficulties threatening the business’s survival. Further details will become clear in the coming months.

3. Introduction of Mandatory Seafarer’s Charter and changes to the Seafarers’ Wages Act 2023

A legal framework for a Mandatory Seafarers’ Charter is being created, replacing the earlier voluntary charter and strengthening protections for seafarers working on vessels that regularly operate in UK waters. 

Previously, protections for seafarers were limited. In 2023, the Government introduced a) a voluntary Seafarers’ Charter, which relied on operator sign up rather than enforcement, and b) the Seafarers’ Wages Act 2023, which linked port access to payment of National Minimum Wage–equivalent pay for work in UK waters on services calling at UK ports at least 120 times a year. This regime focused primarily on pay, and did not cover wider working conditions, and relied on limited enforcement mechanisms.

The plan is for the new Seafarer’s Charter to apply to services calling at UK ports at least 120 times a year. It builds on the Seafarers’ Wages Act 2023 (which will become Seafarers’ (Wages and Working Conditions) Act 2023) and extends beyond pay to cover working conditions, employment rights, safety, roster patterns, fatigue management, training, and remuneration (including pay outside UK waters). 

Operators will be required to provide declarations confirming compliance, to access UK ports. Harbour authorities will be required to impose surcharges or deny access where declarations are not provided. 

The Charter will be implemented through regulations following consultation and is expected to become legally binding in December 2026.

4. Maritime International Convention 

Following Brexit, the government lost powers to implement amendments to international maritime conventions. The Employment Rights Act 2025 fills this gap and gives the government clear powers to implement and keep up to date with international maritime employment conventions. It means it will be simpler to introduce regulations giving effect to amendments to international agreements such as the Maritime Labour Convention and the Work in Fishing Convention. 

Remember that breaching these conventions can be a criminal offence, so keeping track of compliance is key. The latest amendments to the Maritime Labour Convention will be implemented in December 2027 covering:

• Recognition of seafarers as key workers
• Strengthening rights to shore leave
• Enhancing repatriation protections 
• Addressing violence and harassment on board

We will be providing updates on the detail of these changes and how to comply next year.

Our Employment team is working closely with HR, legal and senior people leaders to support policy updates, workforce planning and practical manager training ahead of the reforms. If you’d like to discuss what these changes mean for your organisation, please get in touch with Heidi Watson, or your usual Clyde & Co contact.