Compliance must now face employment rights head-on

With the UK’s Employment Rights Bill nearing final passage, compliance teams are being urged to shift their focus. While many are used to overseeing financial regulations, employment law Partner Justin Murray warns that the new regime will demand deeper engagement from compliance teams with HR and equality issues.

The proposed legislation introduces major changes. These include protections from unfair dismissal from day one, an end to zero-hours contracts, expanded parental leave, and new whistleblower rights. While many reforms will come into effect in 2026, some will begin immediately. For compliance professionals, especially those in financial services, this means expanding their scope.

Justin calls the shift “seismic” and notes that this represents a deviation from compliance being a role that has traditionally focused on external regulatory breaches, not internal investigations or employee discipline. But with growing overlap between employment law and FCA guidance on non-financial misconduct, that line is blurring.

“Employment rights and equality training and upskilling may be necessary to meet the new challenge,” Justin says, pointing to the FCA’s silence on how disciplinary and compliance processes should interact.

“They must now see it as their obligation to ensure due and fair process in such disciplinaries. One hope is that with compliance on the decision-making panels, a more rigorous process may be established generally.”

For firms preparing for the Bill, this means more than updating handbooks or payroll systems. It means embedding compliance into HR processes and ensuring legal teams understand the full range of new responsibilities.

Read the full article in Compliance Week: Compliance teams urged to prepare as U.K. Employment Rights Bill nears passage (paywall)