Liz Roberts
Business Support Executive
Liz brings a wealth of expertise in communication, organisation, attention to detail, and problem-solving. Connect with Liz on Linkedin. Find out more about our team.
The Employment Rights Bill (ERB), now enacted as the Employment Rights Act (ERA), marks the most significant overhaul of employment law in Great Britain in a generation, with changes rolling out in phases across 2026 and 2027.
Introduced at a moment when the Government is simultaneously tightening net migration controls and strengthening worker protections, the ERA lands in what is already the most compliance intensive environment employers have faced in more than a decade.
Although the ERA is not an immigration statute, its reforms will directly influence the UK’s migration landscape by reshaping compliance expectations, altering employer practices, and affecting the day to day experience of sponsored workers.
The ERA in a Nutshell (and Why Immigration Practitioners Should Care)
In a nutshell, the ERA strengthens worker protections (e.g., unfair dismissal rules, flexible working, “fire and rehire” restrictions) and requires sweeping updates to contracts, policies and HR practices over a staged timetable through 2026 and into 2027.
But why does this matter for immigration? The UK migration is tightly coupled to the labour market and sponsor-licence compliance depends on robust HR processes and systems.
The implementation of the ERA arrives in parallel with changes to make a tougher immigration regime, the combined effect of which is a higher bar for employers who hire from overseas.
A new compliance climate for sponsors
With the ERB receiving Royal Assent in December 2025 meaning it formally became law and is now known as the Employment Rights Act (ERA) businesses are compelled to refresh contracts, handbooks, disciplinary/capability procedures and manager training.
This leans into the need for sponsor licence holders to implement those same upgrades to withstand UKVI audits, particularly as the Home Office intensifies enforcement of the unlawful working regime through measures flowing from 2025 legislation.
Businesses should expect deeper scrutiny of onboarding, right to work checks, and the treatment of different categories of workers and contractors.
One practical takeaway from this is for businesses to use their ERA implementation programmes to run a combined ERA × UKVI compliance audit. Aligning people policies with sponsor duties, record keeping, and reporting triggers.
Tougher routes to settlement reshape retention strategies
As immigration policy is shifting from a relatively time based path to permanent residence toward an “earned settlement” model, proposals consulted on in 2025/26 would move most standard routes to 10 year qualifying periods with additional criteria such as conduct, contribution and integration, signaling a structural change to how long sponsored workers must plan to remain on temporary permission before ILR.
It is anticipated that a phased implementation could begin as early as spring 2026, and Parliament has been actively scrutinising the impact on families, children and medium skilled workers.
Language thresholds and candidate pools
From early January 2026, the English language requirement for new applications on key work routes, including Skilled Worker, increased from B1 to B2. This materially reduces the accessible global talent pool for some roles, elevates the importance of pre screening, and may stretch recruitment timelines. ERA driven improvements to working conditions and stability could become differentiators in attracting talent that does meet the higher bar.
Digital border: No permission, no travel
From February 2026, the UK’s Electronic Travel Authorisation (ETA) scheme and enhanced pre departure checks move to full enforcement. Carriers must verify that travellers have valid digital permission before boarding, and eVisas continue to replace physical documents. For employers, this demands earlier, cleaner planning for business visitors, more rigorous document capture in travel workflows, and rapid escalation protocols when digital status mismatches occur.
What Changes on the Ground for Sponsored Workers?
Better protection paired with longer uncertainty
On one hand, the ERA tightens standards around dismissal and workplace protections. Notably, the government’s original “day one” unfair dismissal plan has shifted to a six month qualifying period, still a significant change that makes early performance management and probation handling consequential. For sponsored workers, better run procedures reduce the risk of abrupt, procedurally unsafe terminations that could trigger visa curtailment.
On the other hand, earned settlement proposals point to longer periods on temporary status for many migrants, potentially 10 years before ILR for standard routes, introducing more renewal points, fees, and planning friction for families. Parliamentary debate has centred on downstream effects on children’s stability and household finances, suggesting this will be a live policy space through 2026.
Higher English and more selective pathways
With B2 now the norm for first time applicants on key routes, some candidates (including recent graduates transitioning from B1 level routes) will fall short unless they upskill. Employers who invest in language support and structured onboarding may stand out, especially as immigration policy more broadly signals a preference for fewer but higher skilled migrants.
What Changes for Employers?
Re-write policies with both ERA and UKVI in mind
Recent guidance urges employers to update contracts, policies and practices in 2026–2027; HR consultancies are recommending roadmaps that include manager training, payroll alignment, and risk registers. Consciously build right to work checks, sponsor reporting, and dismissal protocols into that refresh so one programme delivers two outcomes: ERA compliance and sponsor robustness.
Anticipate more touchpoints with the Home Office
Legal updates for 2026 emphasise expanded enforcement from illegal working to sponsor audits. As processes digitise (eVisas, ETA), errors surface earlier (for example at boarding gates rather than border control), increasing the cost of mistakes. Embed immigration checks into travel booking and visitor invitation workflows to avoid failed trips and reputational hits.
Budget for longer journeys to ILR
If settlement moves to a 10 year standard for many routes, renewals (and their fees, health surcharge where applicable, and evidence gathering) will scale up. Couple this with the ERA driven emphasis on fair pay, scheduling and consistent treatment to hold onto valued staff for longer horizons.
Prepare for tighter talent funnels
The B2 English requirement can affect timelines and pass through rates. Adjust recruitment strategies to include earlier testing, pre sponsorship language support, and realistic lead times for onboarding to maintain offer to start conversion.
Interaction Points: ERA Provisions That Matter Most for Immigration Teams
• Unfair dismissal and probation: With a six month qualifying period, managers must follow clear processes from day one; poor handling risks both ERA exposure and immigration consequences if sponsors terminate without due process and then fail to report correctly.
• “Fire and rehire” controls (timing into 2027): Even if slightly delayed, these changes will affect how employers restructure roles especially relevant when role changes implicate occupation codes, salary levels or job descriptions tied to sponsorship. Build immigration checks into any re organisation plans.
• Flexible working & family friendly measures: Better retention tools for all employees help keep sponsored workers engaged through longer pre ILR periods, reducing churn that would otherwise trigger repeat recruitment and sponsorship costs.
Government messaging in late 2025 framed the settlement overhaul as the biggest shake up in 50 years, with accelerated paths only for select categories (e.g., high earners, key public service roles) and extended pathways for those reliant on benefits or with compliance breaches. Regardless of where final rules land post consultation, the direction of travel is clear: more selective settlement, higher language thresholds, and a fully digital border. For employers, that means more planning, more documentation, and a premium on getting HR fundamentals right.
Legal and advisory briefings through January–February 2026 underline the same point: immigration is now a board level issue. The firms advise proactive assessments of illegal working risk, settlement exposure among current staff, and visitor compliance, workstreams that pair naturally with ERA contract and policy rewrites.
Conclusion
2026 is the convergence year. The ERA raises expectations for how UK employers treat and manage people. Simultaneously, immigration policy tightens: higher English thresholds, digital pre clearance, and a potential 10 year standard to settlement for many routes. The intersection is where risk and opportunity sits. Employers who use their ERA overhaul to modernise sponsor compliance, mobility processes and retention strategies will not only stay on the right side of the rules; they’ll also build a more resilient, attractive workplace for global talent.
Frequently Asked Questions
Has the Employment Rights Bill (ERB) been ratified?
Yes. The ERB received Royal Assent on 18th December 2025, becoming the Employment Rights Act (ERA).
Does the ERA directly change UK immigration law?
No. The ERA is an employment law reform, not immigration legislation. However, it significantly influences immigration compliance because UKVI sponsor duties rely on strong HR systems, fair processes, accurate payroll and lawful employment – all areas which have been reshaped by the ERA.
How does the ERA affect sponsored workers’ job security?
The ERA introduces a six-month qualifying period for unfair dismissal, replacing the earlier proposal for day-one rights. This increases the importance of structured probation and performance procedures, reducing the risk of sudden, procedurally unsafe dismissals which could lead to visa curtailment.
Will settlement rules change under immigration reforms coming in 2026?
Yes. Parallel immigration reforms proposing shifting most ILR (settlement) routes to a 10-year “earned settlement” model, adding criteria such as contribution, conduct and integration. Parliament continues to scrutinise these changes, with phased implementation expected from Spring 2026.
Do the ERA changes impact right-to-work or sponsor compliance?
Indirectly yes. The ERA forces employers to update contracts, policies, HR records and workflow, all of which align with the documentation and consistency standards required during sponsor-licence duties. Strong ERA compliance complements UKVI compliance.
Does the ERA apply in Northern Ireland?
Not automatically. The ERA applies to Great Britain. Northern Ireland operates its own employment law framework and a separate package of reforms is anticipated there at some point.
If your organisation needs support navigating the crossover between the ERA and evolving UK immigration rules, now is the time to act to ensure your workforce strategy is future ready.
