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As 2026 continues, employment law is showing no signs of slowing down. With new reforms already in force and more on the way, employers are having to stay increasingly alert to what’s changing and what it means in practice.

In this month’s update, we look at key developments in trade union recognition and proposed changes to NDAs in discrimination and harassment cases. We also explore two recent EAT decisions that highlight important risks around disability management and withdrawing job offers before employment begins.

As always, the focus is on what this means for employers on the ground, and where action may be needed now.

If you would like to discuss any of the topics covered, please contact our Employment team on 0330 123 9501 or reply directly to this email.


TRADE UNION RECOGNITION REFORMS

From 06 April 2026, reforms to the statutory trade union recognition process have significantly lowered the threshold for unions to secure recognition. While the 10% membership requirement currently remains, the broader framework has been simplified to make recognition more achievable for unions.

Key changes include:

  • Removal of the requirement to demonstrate likely majority support
  • Abolition of the 40% support threshold in ballot outcomes
  • A shift to a “required percentage” test, currently set at 10% but potentially reducible to as low as 2% in future

These reforms apply to applications made to the Central Arbitration Committee (CAC) from 6 April 2026 onwards.

What employers should note

These changes increase the likelihood of union engagement, particularly within previously non-unionised workplaces. Further reforms expected in October 2026 are likely to go further, introducing proposed rights of union access to workplaces, including digital access provisions.

Employers should therefore:

  • Review current employee relations and union exposure
  • Prepare for increased recognition applications
  • Consider the potential benefits of voluntary recognition agreements
  • Strengthen internal engagement and communication channels to mitigate external union influence
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INSIGHT 
NDA RESTRICTIONS UNDER THE
EMPLOYMENT RIGHTS ACT 2025

Consultation is underway on proposed restrictions to NDAs under the Employment Rights Act 2025, with changes expected to take effect from 2027.

Under the current proposals, NDAs will be void if they prevent workers from making allegations relating to harassment or discrimination, including commentary on an employer’s handling of such allegations.

However, “excepted agreements” may still be valid where specific conditions are met.

Proposed conditions for valid NDAs include:

  • Receipt of independent legal advice before signing
  • Confirmation that the employee understands the terms and implications
  • A 14-day cooling-off period with the ability to withdraw
  • Written identification of the adviser
  • Confirmation that the agreement only covers past incidents (not future conduct)
  • Provision of a signed copy to all parties

While employer funding of legal advice is not currently proposed as mandatory, it remains common practice.

Practical implications for employers

Although settlement agreements are expected to remain usable, the proposals may increase administrative requirements and scrutiny around enforceability. A key unresolved issue is whether confidentiality provisions must be employee-initiated, which could add complexity and potential legal risk.

Employers should monitor the consultation closely and review settlement agreement templates in anticipation of reform.

IN THE NEWS
CASE STUDY 
DISABILITY, PERFORMANCE & REASONABLE ADJUSTMENTS
Pal v Accenture (UK) Ltd

This case considers how employers should approach performance management where an employee is affected by a long-term health condition, specifically endometriosis. The claimant had progressed successfully within the organisation but later underwent surgery and experienced ongoing symptoms linked to her condition.

The employer operated an “up or elsewhere” performance model, requiring employees to demonstrate continuous progression or face termination. Following a period of illness and recovery, the claimant was assessed as not meeting promotion expectations and was ultimately dismissed.

The Employment Tribunal initially found that endometriosis did not meet the definition of a disability at the time of dismissal and that the employer was entitled to rely on its performance framework. However, the Employment Appeal Tribunal disagreed, finding that the Tribunal had failed to properly consider the long-term and fluctuating nature of the condition.

The EAT confirmed that temporary improvement following treatment does not remove disability protection and that conditions with cyclical or variable symptoms can still meet the legal test under the Equality Act 2010. It also criticised the use of assumptions around how a fair process might have unfolded when applying a 100% Polkey reduction.

Practical takeaways for employers:

  • Endometriosis and similar conditions may qualify as disabilities even where symptoms fluctuate or improve temporarily.
  • Focus on the long-term functional impact of a condition, not short-term presentation.
  • Occupational Health input is essential before making performance or dismissal decisions.
  • Reasonable adjustments should be considered early and reviewed regularly.
  • Performance frameworks must be applied flexibly where disability is a factor.
  • “Up or out” progression models can create legal risk if they do not account for disability-related impact.
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CASE STUDY 
WITHDRAWING CONDITIONAL OFFERS & CONTRACT FORMATION RISK
Kankanalapalli v Loesche Energy Systems Ltd

This case highlights the legal risks associated with withdrawing a job offer after it has been accepted, even where the offer is described as “conditional”. The claimant was offered a Project Manager role which included standard pre-employment conditions such as references and right to work checks, alongside relocation support.

Following acceptance of the offer, the claimant took significant steps in reliance on it, including arranging international relocation and securing long-term accommodation. The offer was then withdrawn shortly before the agreed start date.

The Tribunal initially found that no contract existed due to the conditional nature of the offer. However, the Employment Appeal Tribunal overturned this decision, finding that a binding contract had been formed upon acceptance. The conditions were held to be conditions subsequent rather than precedent, meaning they did not prevent contract formation.

The EAT also implied a reasonable notice period of three months due to the seniority of the role and the reliance placed on the offer. As a result, the employer was found to be in breach of contract and liable for damages.

Practical takeaways for employers:

  • Accepted job offers may form binding contracts before employment starts.
  • “Conditional” wording does not automatically prevent contract formation.
  • Clearly distinguish between conditions that prevent contract formation and those that apply after it has formed.
  • Withdrawing offers may require formal notice if a contract exists.
  • Failure to set out notice terms clearly can result in implied longer notice periods.
  • Relocation and reliance on offers can significantly increase financial exposure.
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