What we learned over breakfast about the Employment Rights Bill and EU Pay Transparency Directive

Discrimination claims were always uncapped, but unfair dismissal is now in the same territory. Employees also have six months to bring a claim, up from three. Both of these changes mean termination processes need to be tighter than they’ve ever been.

You can no longer terminate someone and rehire them on different terms. You also can’t replace a terminated employee with an agency worker. If your company has done either of those things in the past, it’s time to stop. This takes effect from January 2027.

Zero-hours contracts aren’t going away, but companies that use them will need to guarantee a minimum number of hours. If those hours aren’t provided, the salary is still owed. This is still in consultation, with provisions expected in 2027.

The right to switch off was scaled back from legislation to a code of practice. It’s a recommendation, not a mandate.

Harassment protections are being strengthened and will sit within the whistleblowing framework. Kathryn expects the final provisions to be more demanding, not less. You’ll need to show you’ve taken “reasonable steps” to prevent harassment, which means documented training, clear reporting lines, and policies that actually reflect what’s happening.

The change is that when an employer refuses a request, they’ll need to evidence the refusal. A vague “it’s not in the business interest” won’t hold up anymore.

The Fair Work Agency is live but still finding its feet. It handles discrimination and whistleblowing complaints, but enforcement powers haven’t landed yet. Take any correspondence from them seriously, but also verify it’s genuine. Kathryn has seen scam emails pretending to be from the FWA.

Look at your salaries across jurisdictions. Understand the methodology. Is it benchmarked? Negotiated? Inherited from a previous employer? You need to know where you stand before you can close any gaps.

 A lot of companies are moving to banding by job family and level, applied across jurisdictions. This doesn’t mean everyone in the same role earns the same amount globally. Cost-of-living differences and local benchmarks are valid justifications. But you need to be able to explain the variation, and you need that explanation written down.

Why someone is on a particular salary. Why they got promoted. Why someone else didn’t. Kathryn’s message was that if you can demonstrate you’ve made a genuine effort to justify your approach, authorities are far more likely to give you recommendations than sanctions. She gave the example of an audit in Germany where a salary framework she’d built wasn’t perfect, but it was defensible. The outcome was guidance on how to improve, not a fine. Had there been nothing in place, they could have lost their licence.

The directive doesn’t only cover employees. Contractors form part of your organisational structure, and you’ll need to provide data on how you pay them too.

Since most countries will implement the bare minimum when they eventually get around to it, aligning to the directive now puts you ahead. Don’t build country-specific policies where national law isn’t finalised. Build to the directive and adapt when local detail arrives.

Sam made the point that pay transparency is harder as a culture change than as a compliance exercise. Salaries are personal. You’re dealing with managers across multiple countries who all have their own history of how they’ve set pay. The only way to close the gender pay gap is to open things up, and that’s a bigger organisational shift than any single piece of legislation.

Her tactic for getting leadership buy-in was brilliant. She signed two directors up for an external compliance training course without telling them what it was about. They came back with a completely different understanding of what the HR team had been flagging for a year. She also started running internal gender pay gap reporting across all entities, even where it wasn’t required, and walking CEOs through the numbers. It raises awareness and creates the opening to have harder conversations about what’s coming next.

Dee explained that an Employer of Record sees many different approaches to compensation across sectors, company sizes, and geographies. That perspective makes them a useful sounding board, especially for early-stage companies that haven’t built a comp strategy yet. Her advice was that there’s often no single right approach to compensation. What matters is having an approach, documenting it, and being consistent.

But for formal compliance advice on the pay transparency directive, you need lawyers. An EOR can help you understand what you’re dealing with. They can’t advise you on your overall strategy.

Dee was open about Boundless’s own experience. They benchmarked all salaries against Dublin from day one, which helped attract great talent across Europe. But as pricing pressure increased, the approach created friction, especially for more administrative roles where lower-cost territories were an option.

She also flagged a common practice that won’t survive the new legislation. A lot of companies maintain the employer’s total cost of employment when someone moves country, letting net pay flex depending on local taxes. That kind of approach can’t be justified under pay transparency rules.

Sam’s advice was to build your network. Employment lawyers in key markets, EOR partners, people you can call when something changes. You can’t know every piece of legislation in every country. But you can be aware that things are changing and check before you act.

Kathryn recommended a few go-to sources for staying on top of UK and EU employment law.

• DLA Piper’s Be Aware blog for regular updates on UK employment law changes
• GQ|Littler for in-depth analysis and their Employment Rights Act policy hub
• Lewis Silkin’s employment practice for resources and training
• ACAS webinars and training, including free past recordings on topics like redundancy and flexible working
• Daniel Barnett’s free employment law email bulletins, sent three times a week to over 28,000 subscribers. He also presents the legal hour on LBC
• Lexology for free high-level legal summaries across jurisdictions
• The gov.uk employment changes hub where you can sign up for email updates on new rights taking effect

She was also direct about AI tools. Don’t rely on ChatGPT for employment law. She tests it regularly and finds wrong dates, misquoted legislation, and fundamental errors in what’s been implemented.

She was also direct about AI tools. Don’t rely on ChatGPT for employment law. She tests it regularly and finds wrong dates, misquoted legislation, and fundamental errors in what’s been implemented.