Employment Law Alert UK – February 2026

Employment Rights Act 2025

Government publishes updated timeline for implementation of new rights under the ERA 2025. On 03 February 2026 the Government published a timeline update to give "confidence about upcoming changes" for workers, employers and businesses. Of particular significance, the update confirms that the new fire and rehire protections will be introduced on 1 January 2027 alongside the changes to unfair dismissal, rather than in October 2026 as initially planned. Alongside this on 29 January 2026 the government published factsheets which provide further details on the measures included within the ERA. Of note, the factsheet on unfair dismissal confirms that the Government does not intend to consult further on the removal of the cap on unfair dismissal compensation. In a bite size series of videos, our employment team unpacks the key reforms under the Employment Rights Act 2025, with practical takeaways to help you prioritise and prepare. You can watch and subscribe to these here.

DEI

NHS Trust liable for sex and gender reassignment harassment and indirect sex discrimination over transgender changing room policy. The Employment Tribunal considered claims brought by seven female nurses at Darlington Memorial Hospital against their employer, the NHS Trust, regarding its policy permitting a transgender woman (a biological male) to use the female changing rooms. The Claimants argued that this policy, and the Trust's handling of their concerns, amounted to harassment related to sex and/or gender reassignment, indirect sex discrimination, and victimisation under the Equality Act 2010. The Tribunal found that the Trust's policy and its requirement for the Claimants to share a changing room with a biologically male trans woman constituted unwanted conduct related to sex and gender reassignment, violating the Claimants' dignity and creating a hostile, humiliating, and degrading environment. The Tribunal also found that the Trust failed to take the Claimants' concerns seriously and prioritised the perceived rights of transgender employees over those of female staff, amounting to indirect sex discrimination. However, the Tribunal dismissed claims of harassment relating to the conduct of the transgender employee themself, as well as claims of victimisation. The judgment emphasised that the Trust's approach breached both the Equality Act and workplace health and safety regulations requiring single-sex changing facilities, and that a more balanced approach respecting the rights and dignity of all staff was necessary. (Bethany Hutchinson & Ors v County Durham and Darlington NHS Foundation Trust)

EAT upholds claims of indirect race discrimination from insourced GOSH cleaners. The EAT has held that the decision by the Respondent not to move the Claimants onto enhanced terms post transfer, amounted to indirect discrimination, given that 78% of the insourced cleaners were of BAME background.  The Claimants worked at Great Ormond Street Hospital ("GOSH") for a contractor until August 2021 when the cleaning services were brought in-house. Prior to the transfer the cleaners were paid the London Living Wage. After the transfer they were not moved to higher GOSH Trust rates. The ET initially dismissed their claims, but the EAT disagreed in relation to the cleaners' pay post-transfer. The EAT found that the Tribunal had erred in requiring evidence about all contractors to establish a PCP, as the relevant comparison was between the transferred cleaners and directly employed staff on Trust terms. The EAT held that the Trust's failure to move the Claimants onto enhanced pay and benefits after transfer amounted to indirect race discrimination, as a disproportionate number of the affected cleaners were of BAME background, and the Trust could not objectively justify the delay in harmonising terms, particularly in light of an express contractual variation provision in the cleaners' contracts. The case highlights the importance of due diligence and appropriate consultation when contemplating the insourcing of services. (Mr Alpha Anne & Ors v Great Ormond Street Hospital for Children NHS Foundation Trust)

ET upholds claim of harassment in connection with comment that neurodiverse Claimant should get back to focussing on her work. The ET has upheld the Claimant's claims of failure to make reasonable adjustments, harassment and victimisation. The Claimant initially worked for the Respondent as a freelancer, but she became a permanent employee in April 2023. The Claimants dyslexia and rejection sensitivity dysphoria were known to the Respondent. She raised concerns about specific software she was asked to use and requested a break-out area for the summer party. In June 2023 the Claimant went on sick leave and subsequently raised a grievance. The Tribunal found that the Respondent failed to make reasonable adjustments regarding the requirement to use the specific software, and requests for training in connection with this. The Tribunal also found that the Claimant was harassed when her manager said words to the effect that she should 'get back in her work box' during a team meeting. The Tribunal also found that the Respondent's HR Director's email suggesting resignation as the only option after the breakdown in the working relationship constituted victimisation. The Tribunal emphasised the importance of HR professionals having a proper understanding of neurodiversity in the workplace and having proper processes in place for dealing with requests for reasonable adjustments. (Mrs S Stone v MA Business Limited)

ET did not find age discrimination where Claimant called "old" over IT skills. The ET has dismissed the Claimant's claims of direct age, race and sex discrimination, as well as claims of harassment and victimisation.The Claimant worked for the Respondent as a Sales Designer from 4 July 2022 until she was dismissed on 1 December 2022, having failed to pass her probationary period. The Claimant alleged that her dismissal was motivated by discrimination and that she was subjected to harassment and victimisation after raising grievances. The Tribunal, after a detailed review of the evidence, found the Claimant's recollections to be unreliable and concluded that the majority of the alleged incidents did not occur as described or were not linked to protected characteristics. The Tribunal accepted that at one point when the Claimant (39) said that she did not know how to add attachments to a document,  a colleague (late 20s) said to her that it was "coz you're old".  Interestingly through, the Tribunal concluded that the Claimant's colleague would have made the same comment to anyone older than him and as such the claim of direct age discrimination was not well founded. (Ms Farah Janjua v Harvey Jones Ltd (in administration) & Ors)

Employers handling of misgendering of trans employee amounted to disability discrimination. The ET has upheld claims of discrimination arising from disability and indirect disability discrimination against the Respondent and two named individual respondents. The Claimant, who has dyspraxia (a neurodivergent condition affecting coordination and short-term memory), was subject to a formal investigation and found to have harassed a transgender colleague after misgendering them. The Claimant apologised but the incident led to a formal complaint and investigation. The Tribunal found that the Respondent's rigid application of its Dignity at Work and Study policy, without proper consideration of the Claimant's disability and its impact on her ability to remember the correct pronouns, amounted to discrimination arising from disability and indirect discrimination. The Tribunal held that the University failed to make reasonable adjustments or consider less discriminatory alternatives, and that the disciplinary process and subsequent restrictions on the Claimant's work were not justified. Claims of harassment and victimisation were dismissed. (Ms K Sylvester v Stuart Phillpson & Ors)

EAT overturns race discrimination finding against London Ambulance Service NHS Trust. The EAT considered an appeal against a finding of direct race discrimination relating to a delay in providing written feedback to the Claimant, a black African employee, after he was unsuccessful in securing a promotion. The ET had found that, although the decision not to promote the Claimant was not discriminatory, the three-month delay in providing written feedback constituted direct race discrimination. On appeal, the EAT, led by Judge James Tayler, held that the primary facts found by the Tribunal could not logically support an inference that the delay was because of the Claimant's race. The EAT clarified the correct approach to the burden of proof under section 136 of the Equality Act 2010, emphasising that the absence of an adequate explanation for treatment is not, by itself, sufficient to shift the burden of proof to the employer. The EAT concluded that the Tribunal had relied on irrelevant factors and that the facts could not reasonably support a finding of discrimination. The appeal was allowed and the finding of discrimination set aside. The case nevertheless, emphasises the importance of an efficient process for the provision of feedback during a recruitment process.  (London Ambulance Service NHS Trust v Mr I Sodola)

Employment status

Court of Appeal finds that volunteer coastguard rescue officers are "workers" entitled to statutory rights. The Court of Appeal has upheld the EAT's decision that volunteer Coastguard Rescue Officers (CROs) are "workers" under section 230(3)(b) of the Employment Rights Act 1996 when attending activities for which they are entitled to remuneration. The Claimant's position with the Maritime and Coastguard Agency (MCA) was terminated in June 2020 following a disciplinary hearing. The MCA did not allow the Claimant to bring a GMB union official to the meeting and the Claimant challenged this decision. The Court of Appeal found that, although CROs are not obliged to attend any particular call-out, when they do attend and perform duties for which they can claim payment, a contract arises. By virtue of this they are entitled to statutory rights such as the right to be accompanied at disciplinary hearings. The Court rejected the Agency's argument that the relationship was purely voluntary and found that the existence of remuneration and mutual obligations during attendance established worker status, with significant implications for statutory employment protections for thousands of volunteers in similar roles. (Maritime and Coastguard Agency v Martin Groom)

Employee relations

EAT overturns 100% Polkey reduction and orders reconsideration of disability discrimination. The EAT has allowed the Claimant's appeal against a 100% Polkey reduction to a compensatory award for unfair dismissal where the ET had adopted an incorrect counterfactual. The Claimant commenced employment with the Respondent as an Analyst in 2009. She was promoted to Manager in 2013. However, in 2018 and 2019, following periods of sickness absence, she was rated as "Not Progressing" during the annual performance management process (which follows an "up or elsewhere" progression model) and shortly after was dismissed. She brought claims of unfair dismissal and discrimination arising from disability. The ET held that the dismissal was unfair because the Respondent had not followed its own Disciplinary and Appeal Policy (no formal investigation had been carried out and the decision to dismiss was not taken by an independent manager). However, the ET also found that the Claimant would have been dismissed fairly at the same time if the Respondent had introduced a new policy tailored towards performance management which mirrored the process which took place. On appeal, the EAT held that the Tribunal erred by assuming the employer would have introduced a new policy, given that there was no evidence that they would have done this. Rather the tribunal had to consider what would have happened if the Respondent had followed its own process. The EAT also found that the Tribunal failed to properly analyse whether the Claimant, who has endometriosis, was disabled at the material time and whether her dismissal was because of something arising in consequence of disability. The case was remitted to a new Tribunal to reconsider the Polkey reduction, the fairness of the "up or elsewhere" progression model, and the disability discrimination claims. (Ms S Pal v Accenture (UK) Ltd)