Most organisations are treating changes to the Employment Rights Act (ERA) as yet another compliance headache. But if you’re planning to simply update the handbook, brief the managers and move on, you’re missing a string of strategic opportunities.

With the ERA forcing businesses to overhaul core systems, this is your chance to redesign them strategically. Open access to talent you've been missing, build a culture that retains people and create the leadership capability you'll need. Then prove it worked with hard return on investment (ROI). Here's how to do it across four critical areas.

4 strategic opportunities created by the Employment Rights Act 2025

Talent attraction: use day-one rights to redesign access

What ERA requires: statutory sick pay from day one, immediate right to request flexible working and unfair dismissal protection from six months (not two years).

The strategic opportunity: the six-month threshold means you must hire right, onboard well and manage performance fairly from the start – with no room for drift. But these protections also remove risk for candidates who've stayed out of your talent pool: people with health conditions, caring responsibilities, career breaks or non-standard availability. Use ERA as permission to redesign roles so they're genuinely accessible while building the hiring discipline that reduces early-tenure exits.

Execute it: audit roles and strip out unnecessary credential requirements. Tighten role profiles so hiring decisions are evidence-based. Build structured onboarding and early performance check-ins (30/60/90 days) to catch issues fast. Partner with colleges, returnship programmes and community organisations to build new pipelines. Refresh recruitment content to explicitly highlight day-one sick pay and flexible arrangements.

ROI to track: applicant volume, offer acceptance rates, time to fill and community referral rates. Also track six-month retention and quality of hire, as early exits signal hiring or onboarding gaps. Bear in mind that 75% of Gen Zs consider an organisation's societal impact when evaluating jobs, and workplace volunteers are twice as likely to recommend their employer to other jobseekers.

Retention: prove fairness through action, not policy

What ERA requires: enhanced harassment protections (with the ‘all reasonable steps’ test), clearer whistleblowing routes and fair treatment from day one.

The strategic opportunity: retention rises when employees experience fairness in practice, especially in the first 90 days and during vulnerable moments. Use ERA’s ‘all reasonable steps’ requirement to redesign early interventions so they're human-centred, not just legally defensible.

Execute it: design the day-one absence experience with supportive manager prompts and wellbeing signposting. Conduct annual harassment risk assessments covering events, travel and client sites. Add 30, 60 and 90-day check-ins to surface and fix friction points early.

ROI to track: first-year attrition, employee relations case volumes and time to resolution. Organisations with strong social impact commitments see staff turnover decrease by up to 57%, as employees who feel their company contributes positively report higher loyalty.

Engagement and productivity: connect rights to purpose

What ERA requires: clearer rights, safer workplaces and more flexibility from day one.

The strategic opportunity: engagement rises when employees see work connected to something bigger. Position ERA changes as part of how your organisation builds a fairer society, then give people ways to participate in that mission.

Execute it: launch cross-functional projects where teams apply skills to community needs, such as by mentoring small businesses or running digital inclusion workshops. Explain the ‘why’ behind policy changes: “We're making day-one support real because everyone deserves to succeed here.” Add pulse questions on social impact and trust, then close the feedback loop visibly.

ROI to track: engagement scores, productivity metrics and absence rates. 89% of Gen Z and 92% of Millennials say purpose is an important factor in job satisfaction. Employees participating in meaningful social impact initiatives show engagement levels that can increase productivity by up to 21%.

Leadership development: treat ERA as a capability lab

What ERA requires: managers who can handle day-one rights, conduct fair investigations, prevent harassment and document decisions properly.

The strategic opportunity: implementing ERA demands the exact skills your future leaders need – managing ambiguity, having courageous conversations and building inclusive teams. Rather than a compliance burden, treat it as leadership development.

Execute it: map capability gaps to projects (internal and community-based) that build those skills, such as facilitation, stakeholder engagement and project management. Define 2026 leadership behaviours (including fairness, courageous conversations and inclusion advocacy) and run practice labs tied to ERA scenarios. Capture what participants learn and add insights to succession plans.

ROI to track: skills development, promotion readiness and internal fill rates for leadership roles. Skills-based volunteering leads to higher confidence with clear links to career success, offering a cost-effective way to develop leaders and strengthen internal pipelines.

From compliance to measurable business impact

You can see the Employment Rights Act as another box to tick. Or you can treat it as a lever for positive change. By building a simple dashboard tracking your key metrics, you’ll soon see the positive impact of your efforts on attraction, retention, engagement and capability. Overlay participation in social impact activities to see where correlations show up. Then tell the story behind the numbers. What changed? Who benefitted? How did it help the business and the community?

That's how you turn 2026 into a year of meaningful change – with the ROI to prove it.

How we can help you turn the Employment Rights Act 2025 into strategic advantage

Do you need support to build your 2026 HR strategy? Whether you’re designing the approach, identifying the metrics or proving the ROI, our team is ready to help. Reach out to Sharon Broughton or your usual RSM contact for more information.

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