Employment Law Bulletin: April 2026

New statutory rates for 2026

April marks the month each year where changes to statutory rates come into force. Most rate changes take effect from 6^th April (to align with the start of the new tax year). 

The statutory rates for family leave, sick pay, redundancy and the cap on unfair dismissal compensatory awards are, from 6^th April 2026, as follows:
 

 
*Under Employment Rights Act 2025 changes, due to take effect from January 2027, the cap on the compensatory award for unfair dismissal will be removed in its entirety. The figure in this table applies to all dismissals from 6^th April 2026 until this change comes into effect.

The average gross weekly earnings required to qualify for the various forms of family leave pay will also increase from £125.00 or more per week, to £129.00 or more per week from 6^th April 2026. 

The amounts in the table above represent the minimum requirements. They may be replaced by higher payments if the employer chooses to offer more voluntarily or is required to do so under the employee’s contract.

National minimum wage changes from 1st April

Last month, the Government released its latest ‘name and shame’ list of employers who failed to pay national minimum wage to their workers. On the list were high profile names including Costa, Bupa, and Hovis. This potentially reputationally damaging naming and shaming process sits alongside fines of up to 200% of the value of the underpayment. Paying national minimum wage incorrectly can be costly in more ways than one.

Employers can inadvertently end up paying the wrong rate of national minimum wage if they fail to correctly apply the annual increase which takes effect from 1^st April each year, or if they fail to realise that an employee has moved into an older age category.

Employers should check their payroll provision to make sure systems reflect the new figures for national minimum wage which took effect from 1^st April 2026: 
 

 
These amounts set out the minimum wages payable. They may be replaced by higher payments if the employer chooses to offer more voluntarily or is required to do so under the employee’s contract.

When Is a Right of Appeal Necessary?

Handling appeals can feel like revisiting ground you would rather leave behind. However, from a legal perspective, offering an appeal is not optional in most cases - it is a fundamental part of a fair dismissal process.

Under s98 Employment Rights Act 1996, fairness is judged by looking at the process as a whole. In practice, failing to offer (or properly conduct) an appeal will usually render a dismissal unfair. This is reinforced by the Acas Code of Practice on Disciplinary and Grievance Procedures, which states that employers “should allow an employee to appeal against any formal decision”. A failure to follow the Code can lead to an uplift in compensation of up to 25%.

That said, the position is not entirely absolute. The Acas Code formally applies to misconduct and performance dismissals. It does not apply to redundancy situations and has been held not to apply to ill-health dismissals (see Holmes v Qinetiq Ltd). It will also not usually apply to dismissals for “some other substantial reason” (SOSR), unless there is a disciplinary element (Phoenix House v Stockman).

Even where the Code does not apply, however, offering an appeal will still usually be required for overall fairness. The bar for departing from this is high. Case law suggests that only in exceptional circumstances—where an appeal would be “truly pointless”—can an employer safely omit it.

In Moore v Phoenix Product Development Ltd, the Employment Appeal Tribunal accepted that no appeal was required where there had been an irretrievable breakdown in trust between a company’s founder and its leadership. Given the seniority of the individual, the small size of the business, and the complete collapse in working relationships, an appeal would have served no practical purpose.

However, employers should be cautious. In Afzal v East London Pizza Ltd, the EAT held that an SOSR dismissal was unfair precisely because no appeal was offered. Even though the employer believed dismissal was unavoidable due to immigration concerns, an appeal might have allowed the employee to provide missing evidence.

The takeaway for HR is simple: treat the right of appeal as essential. Only in the rarest cases will its omission be justified - and getting that judgment wrong is likely to be costly.

Dismissing for gross misconduct: lessons from Langton v Buckinghamshire Fire and Rescuee

A recent Employment tribunal judgment provides a good case study for employers of what not to do when dismissing an employee for gross misconduct. In Langton v Buckinghamshire Fire and Rescu, Mr Langton, an experienced firefighter, was summarily dismissed for gross misconduct after making a "misogynistic" comment saying a woman he rescued looked 'haggard for her age'. The employment tribunal found that the dismissal was unfair.

The legal test for a fair misconduct dismissal

The 3-stage legal test for fairness when looking at misconduct dismissals was set out in the classic case of Bhs v Burchell. The employer must:

1. hold a reasonable belief
2. based on a reasonable investigation
3. that the employee has committed an act of misconduct.

Where the employer dismisses for that misconduct, the decision to dismiss must fall within the ‘band of reasonable responses’ which an employer might have in the circumstances. 

The employer must show both substantive fairness (i.e. that an act of misconduct has, on the balance of probabilities, been committed and that it justifies dismissal) and procedural fairness (that a fair process is followed in investigating and hearing the allegation).

What the employer got wrong

In Langton, the employer made certain key errors which turned what could have been a fair dismissal into an unfair one:

1. The employer took account of an expired ‘warning’. The employer wrongly took account of a “Note for File” about the employee which was five years old. It should have been disregarded, under the employer’s policy, after six months.
2. The employer acted unreasonably in characterising Personal Development Plans as evidence of prior misconduct. Employers need to be careful not to try and ‘mould’ evidence to their case. The PDPs did not disclose misconduct – in fact one rated him a ‘high performer’.
3. The employer wrongly relied on prior competence issues as evidence of previous misconduct. 

Every cloud has a silver lining

Despite finding the dismissal unfair, the tribunal did find that the decision to dismiss (if it had been for the misogynistic comment alone) would have fallen within the ‘band of reasonable responses’. The employer was helped here by their thorough investigation into this incident, which included strong evidence from those present as to the impact of the employee’s comments. 

As the tribunal was able to conclude that an act of misconduct had taken place – it ordered that the level of compensation due to Mr Langton should be reduced by 65%. This is in line with the compensatory principle of contributory fault: Mr Langton, by his conduct, contributed significantly to the decision to dismiss him.

What happens to holiday entitlement when an employee is off sick?

In most cases, employees continue to accrue statutory holiday entitlement while on sick leave, even if they are off work for long periods.

The general rule (most employees)

For workers with regular hours and year-round contracts:

• Holiday continues to build up during sickness absence
• If the employee is unable to take holiday because they are sick, they are entitled to carry over up to four weeks’ leave into the next leave year

However, it’s important to note:

• The right to carry over only applies to the four weeks’ leave under Regulation 13 of the Working Time Regulations
• It does not apply to the additional 1.6 weeks under Regulation 13A, unless the employer allows this by contract
• Workers must take carried-over leave within 18 months of end of year it has been carried-over from

So, in practice, only 4 weeks per year can be carried forward automatically.

Part-year and irregular hours workers (Regulation 15B WTR)

For part-year workers and those with irregular hours - whose holiday entitlement is now calculated based on hours worked under Regulation 15B Working Time Regulations 1998:

• Holiday accrues as a percentage of hours actually worked. This accrual is calculated by reference to an annual holiday entitlement of 5.6 weeks. There is no differentiation into 4 weeks and the additional 1.6 weeks like there is for other workers. 
• Irregular hours workers and part-year workers on sick leave continue to accrue annual leave whilst they are off under a calculation set out in the regulations. This works by calculating 12.07% of the average hours worked in the 52 weeks prior to the absence on sick leave (including any weeks where no work was done but excluding any weeks where the worker was on sick leave or statutory leave).
• This accrued leave can be carried over if the employee is unable to take it owing to sickness in the same way as Regulation 13 leave for other workers (i.e. the carried-over leave must be taken within 18 months of end of year it has been carried over from)

Employers should make sure their holiday policies clearly reflect these differences to avoid disputes.

Choosing and managing companions: rights, risks and practical judgment

Employees do not have a free choice of companion. Section 10 ERA 1999 limits the statutory right to:

• a work colleague, or
• a trade union official (employed by the union or certified as trained or experienced).

Where the companion falls within those categories, the employee has an absolute right to that person - as confirmed in Toal and Hughes v GB Oils.

Employers cannot insist on an alternative simply because they dislike the choice. The only protection is that compensation may be reduced if refusing the companion was justified - for example due to prior inappropriate behaviour. In Romello Shoaib-Brown v IQVIA IES UK Ltd, compensation was reduced where the chosen companion had been obstructive and rude in earlier meetings.

Beyond the statutory minimum, flexibility is often required. For disabled employees, allowing a friend or family member may be a reasonable adjustment. In Crew and Mason v Three Milestone Education Ltd, refusing to allow Ms Mason’s mother to attend her disciplinary hearing was both a failure to make reasonable adjustments, and disability-related harassment.

Policies and contracts may also widen eligibility, sometimes permitting partners, legal representatives or support workers. Even where they do not, small employers or language-barrier situations may justify a pragmatic approach.

Companions have defined - but not silent - roles. They can present the employee’s case, sum it up, respond to views expressed, and confer privately. They are not entitled to answer questions for the employee unless permitted. Tribunals are cautious about over-restricting this role. In Aslam v Sainsbury’s Supermarkets, barring a combative representative was held to be unfair where they were simply ‘fighting the employee’s corner’.

Employees can also postpone a hearing by up to five working days if their companion cannot attend, and work-colleague companions must be allowed paid time off for preparation and attendance.

Failure to comply can lead to compensation of up to two weeks’ pay per breach, automatic unfair dismissal if the employee is dismissed for exercising the right, and broader fairness challenges to any disciplinary outcome.

Handled well, the right to be accompanied can assist the process and make it run more smoothly and collaboratively. Handled rigidly, it creates legal risk.

‘All reasonable steps’: about to become a new HR obsession?

The concept of ‘all reasonable steps’ is not a new one. In harassment cases under Equality Act 2010, employers are able to defend a claim for harassment on the basis that they took ‘all reasonable steps’ to prevent it. The defence is narrow and very hard to run successfully. Many employers will run the defence in the early stages of a tribunal claim, only to quietly drop it in the face of an obvious inability to provide the evidence required to demonstrate that they had done it ‘all’. 

What the defence currently involves

In Canniffe v East Riding of Yorkshire Council, the Employment Appeal Tribunal stated that a tribunal should take a two-stage approach to the ‘all reasonable steps’ defence. First, it should look at what steps the employer took. It should then consider whether there were other reasonable steps that it could have taken. If any other reasonable steps exist, then the defence will fail.

How ‘all reasonable steps’ is flexing in the future

The Employment Rights Act 2025 will, from October this year, introduce employer liability for harassment committed by third parties. The relevant subsections being inserted into s40 Equality Act state:

“(1A)An employer (A) must not permit a third party to harass a person (B) who is an employee of A.

(1B)For the purposes of subsection (1A), A permits a third party to harass B only if—

(a)the third party harasses B in the course of B’s employment by A, and
(b)A failed to take all reasonable steps to prevent the third party from doing so.”

The idea that employers could be liable not just for the harassing acts of their employees (who they have a large degree of control over), but also for the harassing acts of third parties such as visitors, clients, customers and suppliers (who they have much less control over), places a worrying burden on employers.

Whilst detail and guidance on this new legal obligation is awaited, it is interesting to note that the concept of ‘all reasonable steps’ is positioned differently for third party harassment. Rather than forming a defence to what would otherwise be a successful harassment claim (which is how it works for employee-on-employee harassment), it actually forms part of the offence itself. The employer will only be liable if the employee can show not just that harassment occurred, but that the employer failed to take all reasonable steps to prevent the third party from harassing. Rather than placing a positive duty on the employer to prove ‘all reasonable steps’ were taken, it places the burden on the employee to show that they were not.

What this means for employers

Where third party harassment is alleged, it is going to be that much more difficult for the employer to gather evidence which demonstrates that it did not occur. In particular, witness statements will be harder to come by, and commercial sensitivities may mean that the employer does not want to hound the third party for information. Assuming this is borne out in practice, the whole focus of this new claim will become whether or not the employer failed to take all reasonable steps to prevent the harassment from occurring. This places ‘all reasonable steps’ at front and centre for HR in the future.

Top tips for employers as they prepare for this new legal landscape include:

• Undertake a full risk assessment of third party harassment risk in your workplace. Keep this under regular review.
• Take all reasonable steps highlighted by the risk assessment to reduce third party harassment risk. This might include erecting notices, putting protocols in place, implementing ‘buddy’ systems, and promoting clear lines of harassment reporting.
• If you identify a step which could be taken but conclude that it would not be reasonable to take it, then make a clear note of this decision and why it was taken.
• The new claim applies to third party harassment which occurs in the course of the victim’s employment. Consider carefully the potential scope of ‘in the course of your employment’ for your business (it can potentially apply to situations away from the physical workplace and to high-risk occasions, such as client social events).
• Do not back-load taking action. Remember, the positive duty to prevent sexual harassment already applies to harassment by third parties. An employer’s third-party harassment obligations are not coming from a standing start in October, and neither should an employer’s ‘reasonable steps’.

And Finally...

Sometimes the factual background to a tribunal claim sounds like it has come straight out of high school. Billings v Nestle UK is one of those claims. The fire alarm had gone off at the factory where Mr Billings worked, requiring a full evacuation. An investigation into the cause of the fire alarm concluded that somebody had been vaping in the toilets. Nestle alleged that that somebody was Mr Billings. If this had been High School, Mr Billings would no doubt have received a detention - nothing more. However, this being employment (and in a factory environment), he was dismissed for gross misconduct. The tribunal held that Mr Billings had been unfairly dismissed:

• The disciplinary officer was more concerned about Mr Billings’s lack of apology than the vaping itself. He openly acknowledged that if Mr Billings had admitted the conduct, he would not have been dismissed. The tribunal concluded that “failing to apologise or to accept responsibility is not misconduct”. The employer should not have relied upon it.
• Dismissal fell outside the range of reasonable responses available given that this was a single isolated act in an otherwise unblemished career. 
• The employer had no policy which specifically said that vaping at work would be regarded as gross misconduct.

There are lessons to be learnt by employers from this high school-worthy situation:

• If vaping at work is really that much of an issue, you should make that crystal clear in your policies.
• Length of service and a clean disciplinary record can be important factors when considering whether summary dismissal is an appropriate sanction in response to alleged gross misconduct.
• Disciplinary officers should stick to the allegations in front of them and not get distracted by irrelevant points such as, in this case, the lack of an apology.