Employment Rights Bill: what it means for the built environment sector

The Employment Rights Bill (ERB) is nearing the finish line. Following the latest vote in the House of Lords, most government amendments have been accepted – except one: the removal of the cap on compensation for unfair dismissal, which returned to the Commons on 15 December 2025.

What are the key changes proposed by the ERB for the built environment sector?

Unfair dismissal
The qualifying period for unfair dismissal claims will reduce from two years to six months. Future changes can only occur through primary legislation, making this a long-term shift.

Employers will now face legal exposure much earlier. Project-based work and seasonal contracts will require tighter probation processes, faster performance reviews and clear documentation to defend decisions. Businesses may also need to rethink contract lengths to manage risk effectively.

Guaranteed hours and seasonal work
The ERB introduces a duty to offer predictable hours to workers who work regular patterns over a set reference period. This change remains subject to consultation, particularly on how reference periods will work and how seasonal roles fit in.

For construction and property businesses, this could reduce flexibility. Many firms scale up for major projects and scale down when work slows; these changes will make that harder.

Employers should start mapping roles with predictable patterns (e.g., site security or plant operation) and review agency agreements to prepare.

Industrial action
Electronic balloting for industrial action is on the horizon. Before removing the turnout threshold for strike ballots, ministers must assess the impact of electronic voting and report back to Parliament.

For the sector, this, along with other changes relating to trade unions/industrial action, could make strikes easier to organise, with significant implications for time-critical projects. Now is the time to refresh industrial relations strategies, build contingency plans and maintain open communication with unions.

Strengthened sexual harassment protections
The ERB builds on the Worker Protection Act, raising employer obligations and expanding liability. Employers must now take all reasonable steps, not just “reasonable steps”, to prevent workplace sexual harassment.

This means moving beyond policies to proactive measures such as documented risk assessments, regular training and clear reporting channels. For example, site managers should ensure welfare facilities are safe and private, and that zero-tolerance policies are visible and understood.

Responsibility doesn’t stop with employees. Employers can now be held liable for harassment by contractors, clients, or even members of the public if they fail to take preventive action. Reports of sexual harassment are also explicitly covered under whistleblowing law, protecting employees who raise concerns internally or externally from retaliation.

Compliance is no longer a tick-box exercise. Construction sites and property projects often involve multiple contractors and transient workforces, creating high-risk environments. Employers should conduct site-specific harassment risk assessments for isolated work areas and welfare facilities, implement mandatory training for all staff and contractors before site access, audit agency agreements to include harassment prevention obligations, and establish clear escalation routes, including anonymous reporting options.

The Employment Rights Bill represents a significant shift in workplace regulation, with far-reaching implications for the built environment sector. Reduced qualifying periods for unfair dismissal, obligations regarding predictable hours, and strengthened harassment protections will require businesses to reassess their processes, contracts and compliance strategies.

While some details remain subject to consultation, proactive planning now will help organisations stay ahead of risk and maintain operational resilience. In short, the ERB signals a new era of accountability – those who prepare early will be best placed to adapt and thrive.

Laura Oxley, director, employment and immigration, Walker Morris