Employment Law Alert UK – May 2026

Employment Rights Act 2025

Consultation launched on changes to NDAs.

On 15 April 2026, the government launched a consultation relating to the new provisions of the ERA 2025 which render void any contractual provision preventing workers from speaking out about relevant harassment or discrimination. The consultation seeks views on proposals for when a non-disclosure agreement (NDA) may still be valid — such as where the NDA is requested by the individual and independent advice has been obtained. It also addresses to whom individuals who enter into an ‘excepted agreement’ may disclose information, regardless of NDA terms, with examples including qualified lawyers and medical professionals. The consultation also considers expanding the scope of the prohibition on NDAs to potentially include certain self-employed persons. We will be preparing a response to the consultation. If you would like us to discuss these proposals and their impact on your business please do reach out to your usual contact. The consultation closes on 8 July 2026.

Government launches call for evidence on TUPE.

On 8 April 2026, the government launched a call for evidence to inform potential reforms to the Transfer of Undertakings (Protection of Employment) Regulations (TUPE), which safeguard employees during transfers between or within organisations and provide a framework for staff management in mergers and acquisitions. This initiative, part of the Plan to Make Work Pay, aims to strengthen TUPE protections. The evidence gathered will help the government to assess experiences with current processes, and explore ways to make TUPE easier for businesses to navigate, whilst continuing to protect employees affected by TUPE. Responses are invited from businesses, employees, and their representatives. The call for evidence closes on 1 July 2026.

Employee relations

EAT opines on employer’s ability to withdraw job offer.

The EAT has allowed an appeal by the Claimant, finding that the Respondent’s offer of employment was subject to conditions subsequent, not precedent, and that as a result the Respondent was in breach of contract when it informed the Claimant, without giving notice, that it was withdrawing the offer. The EAT held that a reasonable notice period of three months should be implied in the circumstances. The Claimant was offered a project manager role by the Respondent, with the offer letter stating that the appointment was subject to satisfactory references, a right to work check, and a six-month probation period. The offer letter also set out the key terms of the contract, but did not specify a notice period. The Claimant accepted the offer and provided requested information. However, before the start date, the Respondent withdrew the offer due to a delay in the project. At first instance, the ET found that there was no binding contract on the basis that the job offer remained conditional at the point it was withdrawn. However, the EAT disagreed, finding that the ET had failed to consider whether the conditions were subsequent (and applied after the contract began), or precedent (meaning they would need to be satisfied before the contract came into existence). The EAT determined that the conditions in the offer were subsequent, meaning a binding contract was formed upon acceptance, but it could be terminated if the conditions were not met. The EAT also found that the ET erred in its approach to implied notice, holding that reasonable notice should be assessed at the time the contract was made, not later, and that three months’ notice was appropriate given the seniority of the role and the circumstances. The EAT substituted a judgment in the Claimant’s favour for three months’ notice pay, but rejected claims for holiday pay and relocation expenses. Kankanalapalli v Loesche Energy Systems Limited

Scottish Court of Session rules that PHI benefits may survive dismissal.

The Inner House of the Court of Session has held that PHI benefits were a collateral obligation, not dependent on the ongoing employment relationship, and therefore an implied term prevented the Respondent from terminating the contract to avoid paying these benefits. The Claimant was dismissed in 2013 due to incapacity. She brought a claim contending that her entitlement to PHI benefits continued post-dismissal. In doing so she relied on an implied contractual term preventing dismissal for incapacity while eligible for PHI. The Employment Tribunal and EAT had previously rejected her attempt to extend her unauthorised deduction from wages claim beyond her dismissal, holding that such payments could not be "wages" after the employment relationship ended. On appeal, the Court of Session held that the PHI benefits were collateral to the employment relationship, rather than dependent on it. The Court distinguished the case from Delaney v Staples, holding that the extended statutory definition of "wages" could include PHI payments, and that wrongful dismissal for incapacity did not necessarily end the right to such benefits. The Court allowed the Claimant’s claim for ongoing PHI payments to proceed, subject to her continuing to meet the eligibility criteria. This decision emphasises the need for caution when an employee may potentially have a PHI entitlement, especially given that the losses in connection with such claims are likely to be significant. AXA ICAS Ltd (now AXA Health Services Ltd) v McMahon [2026] CSIH 19

ET erred in ruling protected conversation inadmissible in relation to all claims.

The EAT has held that the ET misapplied section 111A of the Employment Rights Act 1996, which protects the confidentiality of “protected conversations” in unfair dismissal claims. The EAT clarified that section 111A applies only to ordinary unfair dismissal claims and not to other claims such as unlawful deduction from wages or less favourable treatment as a part-time worker, meaning evidence of protected conversations may be admissible for those other claims. In April 2024 the Claimant was called to a meeting which was called a “protected conversation”. It was alleged that a settlement offer was made during this meeting. After the Claimant’s dismissal, he brought claims of unfair dismissal, unlawful deduction from wages and less favourable treatment as a part-time worker. At first instance, the ET held that the Respondent’s conduct in holding the “protected conversation” with the Claimant was not improper and as a result references to that conversation should be redacted from proceedings. The EAT held that the ET erred in applying section 111A to the deduction of wages and less favourable treatment claims. It had also erred in its consideration of whether the Respondent’s conduct was ‘improper’ (which would lift the confidentiality). The Tribunal must consider the full circumstances, including how the meeting was arranged and whether the individual was afforded the opportunity to bring a companion, not just the words spoken at the meeting. The case was remitted for reconsideration. This decision may give employers pause for thought when seeking to arrange a protected conversation, as the threshold for these being deemed ‘improper’ may be lower than previously assumed. Tarbuc v Martello Piling Ltd

EAT opines on collective consultation duty during administration.

The EAT has held that the Respondent breached its duty to consult collectively under s.188 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) when dismissing employees as redundant, during administration. The Respondent, which was facing financial difficulties, entered administration in May 2023 and dismissed most of its 51 employees in two waves - 15 on 2 May and the remainder on 5 May. The ET found that only those dismissed on 5 May were entitled to a protective award, reasoning that there was no proposal to dismiss 20 or more employees as redundant on 2 May, as at that stage it was contended that the intention was to sell the business as a going concern. On appeal, the EAT held that the Tribunal had erred by focusing on the timing and certainty of the proposal, rather than whether the employer was "proposing to dismiss" 20 or more employees within a 90-day period—a test that includes provisional intentions and ongoing consideration of future redundancies. The EAT found that, as of the administrators’ appointment, the likelihood of mass redundancies was sufficiently clear to trigger the duty to collectively consult, and substituted its own decision, granting a protective award to the appellants for a 90-day protected period. This judgment emphasises the need for employers to give particular consideration to collective consultation when making redundancies during administration - even where the future is uncertain, or other options are on the table. Ellard, Hulse, and Warren v Alliance Transport Technologies Ltd (in Administration) [2025] EAT 169

Litigation procedure

EAT finds that fair trial no longer possible given delays.

The EAT dismissed the Claimant’s appeal against the strike-out of his discrimination complaints and refusal to postpone the hearing of his unfair dismissal claim. The Tribunal found that, due to the passage of time, a fair trial was no longer possible, and the Tribunal had not erred in its approach. The Claimant worked for the Respondent from January 2017 until October 2019. In February 2020, following his dismissal, he brought multiple complaints of discrimination (race and religion) – some of which related to events in 2017, together with claims of unfair dismissal, and holiday pay. Progress was delayed by the Covid-19 pandemic and the Respondent’s CVA, resulting in many relevant witnesses leaving the Respondent and being uncontactable or unwilling to cooperate. At a preliminary hearing in 2023, the Tribunal struck out the discrimination claims, but allowed the unfair dismissal and holiday pay claims to proceed. The EAT confirmed that the Tribunal had properly considered the impact of missing witnesses (notably 22 of the 27 people named in the Claimant’s claims no longer worked for the Respondent, and of those 17 were uncontactable or unwilling to co-operate), the documentary record, and the possibility of “carving up” the claims, concluding that the Respondent would be at an unfair disadvantage and a fair trial was not possible. The EAT also upheld the Tribunal’s refusal to postpone the unfair dismissal hearing, finding no material change in circumstances and that any overlap between the discrimination and unfair dismissal claims could be managed in future proceedings. Both appeals were dismissed, with the EAT emphasising the fact-sensitive nature of strike-out decisions and the importance of ensuring fairness to all parties. Although inevitably a fact-specific case, with an extreme lack of witness availability, in the context of increasingly long delay in the Employment Tribunals we may increasingly see questions being raised about the fairness of proceeding to a trial many years after the relevant events. Boateng v Moss Bros Group Ltd.

Judicial recruitment challenges and increasing numbers of complex claims.

The minutes of the 55th Employment Tribunal National User Group meeting, which took place in March 2026, have now been published. The President of the Employment Tribunals highlighted a significant and sustained increase in claims, particularly complex “open track” cases (notably disability discrimination), with London and the South East facing acute resource challenges due to difficulties in recruiting salaried judges. The President confirmed ongoing efforts to mitigate delays, including a major recruitment drive for 55 new salaried judges, increased use of video hearings, and renewed focus on dispute resolution and alternative dispute resolution (ADR), but emphasised that these measures may only partially address rising backlogs and waiting times, which now extend into 2028–29 for longer hearings in some regions. The impact of AI on claim complexity was also noted. Interestingly, it was observed that at the moment the judiciary consider that it is relatively easy to spot the use of AI in a document, and also that AI is likely behind the increase in complexity of claims, additional applications, and inflated schedules of loss.

Privilege

High Court clarifies scope of legal advice privilege for intra-client communications.

The High Court has held that legal advice privilege can apply to internal communications between members of a client group, not involving a lawyer, provided that those documents are created for the dominant purpose of seeking legal advice. The Court rejected the Claimants’ argument that privilege should only attach to communications directly between client and lawyer, or documents evidencing such communications. The case arose during extended disclosure in complex commercial litigation, where the First Defendant had asserted legal advice privilege over internal communications between members of its “client group” (as defined in Three Rivers (No 5)), not just those involving external lawyers. The Claimants challenged this approach, arguing that such intra-client documents should not be privileged unless they disclosed the substance of legal advice or were intended to be sent to a lawyer. The High Court concluded that there is no principled reason to treat early stage communications with a lawyer differently from equivalent documents created internally within a client group: “there can be no justification for treating intra-client documents, created as part of the process of seeking legal advice or assistance and/or for which the intention to communicate with the lawyer accounts for the existence of the document, as not attracting legal advice privilege in circumstances where that privilege is available in relation to other documents that are materially similar”. For more please see our Insight: Privilege can apply to communications not involving a lawyer, Aabar Holdings SARL v Glencore plc.