Employment law has changed. Is your leadership ready?
Employment law puts the cost of poor leadership up.
Here's a question that might make you slightly uncomfortable. If every management decision made in your organisation over the next 12 months was examined in an employment tribunal, how confident would you feel?
Not just the decisions made by HR. The decisions made by every line manager, every day. The performance conversation that didn't happen. The feedback that came six months too late. The probation review that was a bit vague. The behaviour everybody knew about but nobody tackled. The manager who was promoted because they were brilliant at their job and then largely left to work out the people bit for themselves. How confident would you be in all of those?
Because that's where I think the changing employment law landscape gets rather more interesting.
Listen to the full episode on the player below, or read the full conversation by downloading the full transcript.
This isn't really an employment law problem
The Employment Rights Act 2025 brings some significant changes for employers. From 1 January 2027, the qualifying period for ordinary unfair dismissal protection will reduce from two years to six months. The existing cap on compensatory awards for unfair dismissal will also be removed, although awards will continue to be based on actual and projected losses evidenced by the claimant. Those are substantial changes. And understandably, organisations are reviewing policies, contracts, processes and procedures in preparation.
They should. But I wonder whether there's a danger in believing that getting the paperwork sorted means you're ready.
Employment law might sit nicely within a policy document, but employment relationships don't. They happen between people. And more often than not, the biggest relationships between an employee and their manager, is where we either see growth and performance, or experience friction and exits.
In my recent Sticky From The Inside conversation with Aliya Vigor-Robertson, co-founder of JourneyHR, Aliya made the point that the law is increasingly catching up with expectations many good employers already recognise: people want decisions they can understand, processes that feel fair and managers who act consistently. Her conclusion was that this isn't simply a legal shift. It's a shift in how we need to lead people today.
That distinction matters. Because the new law isn't creating a leadership problem. It's exposing the existing one.
We've tolerated amateur management for a very long time
There's a strange contradiction in business. We happily acknowledge that disciplines such as finance, marketing, operations, sales and technology require expertise. We train people. We develop them. We give them tools. We regularly update those tools to keep pace with change and innovation. We expect them to understand what they're doing. Then somebody becomes responsible for the performance, development, motivation and working experience of another human being and we can still behave as though they'll somehow easily pick it up along the way.
Aliya described the assumption perfectly in our conversation:
"You'll get the hang of it."
There's a policy. There's a process. Off you go.
And I recognise that world because I've lived in it too. I've been promoted into management roles because I was good at the job I was already doing. I wasn't handed some magical box of management wisdom along with the new job title. I learned a lot by doing it. I also got things wrong. Most of us in that position do.
The problem isn't that managers occasionally make mistakes. We're dealing with humans, not programming machines. The problem comes when organisations make people responsible for managing others without properly equipping them to do it, and then act surprised when inconsistency, avoidance, poor communication, and messy people problems follow.
For years, we've talked about the consequences in terms of engagement, trust, retention, culture and performance. Now there's another consequence becoming harder to ignore.
Bigger Financial & Reputational Risk.
Perhaps the business case just became more immediate
This is the bit I find both interesting and slightly depressing. People like me have spent years talking about the positive case for investing in managers to develop leadership skills and capabilities.
Build better managers and you're more likely to create teams where people understand what's expected of them, feel able to contribute, receive useful feedback, develop, contribute willingly, perform and stay. There's plenty of evidence connecting the quality of management and employee experience with important organisational outcomes. Yet leadership and management development can still be one of those investments that gets pushed down the list. There's always something more urgent. Something with a more immediate return. The people line is already big on the P&L, let's not add to it, eh?
During my conversation with Aliya, I wondered whether the employment law changes could flip that calculation. What if the argument is no longer only:
"Develop your managers because it will help create a better-performing organisation."
What if it now also becomes:
"Develop your managers because failing to do so could expose the organisation to much more immediate commercial, financial and legal consequences."
I'd rather organisations invested in good management because they genuinely wanted people to thrive. But if increased risk finally makes some of them pay attention? I'll take it.
HR can't have every conversation
There's another habit I think these changes should make us question. When something involves employees, we can be very quick to make it an HR problem.
Of course HR has a vital role. In my career, I'd like to think I worked very closely with my HR colleagues and showed them due respect. In this situation, HR should absolutely understand the legislation, help organisations interpret it and build appropriate policies and processes. It should also advise leaders, maybe even coach managers through difficult situations and challenge poor practice. But HR cannot manage everybody.
As Aliya put it rather neatly during our conversation:
"HR can build the rails, but managers and leaders have to drive the train."
That's the bit organisations can't outsource to the People team. HR cannot sit in every one-to-one. They can't notice every early sign that somebody is struggling. They can't clarify every expectation. They can't give every piece of feedback. They can't tackle every bit of poor behaviour. They can't build trust in every team. And they certainly can't have every difficult conversation.
That's management. And if we're asking managers to do those things, perhaps it's time we stopped treating them as optional extras to the "proper job". They are the proper job.
The conversation you avoid today becomes the problem you inherit tomorrow
One of the themes Aliya and I kept returning to was performance management. I think the phrase itself causes trouble. Mention "performance management" and it's easy to picture a formal process involving HR, documentation, warnings and somebody who's already halfway out of the door.
But good performance management should start long before any of that. What are we asking somebody to do? Do they understand what good looks like? How are they doing? What feedback have they received? What support do they need? What needs to change?
Those aren't restricted HR questions. They're everyday management questions. And when those conversations happen early, clearly and consistently, people have a chance to do something with them. When they don't, frustration quietly builds. The manager can get increasingly annoyed. And yet, the employee may have no idea there's a serious problem. Then eventually something gives and the organisation wants to "deal with performance".
By which point everybody is starting from a much worse place.
This connects directly to something I talk about a lot in my own work:
Be kind, not nice.
Being nice can mean avoiding an uncomfortable conversation because we don't want to upset somebody. Being kind means respecting them enough to tell them something they need to know while there's still time to do something about it. Or, as Aliya beautifully put it:
Clarity is kindness when it arrives early enough for somebody to act on it.
That's not about becoming tougher, harsher, stronger managers. It's quite the opposite.
It's about being clearer ones. Being clear ofetn negates the need to be tough, harsh or strong.
Policies don't create culture. Behaviour does.
You can have a beautifully written performance management policy. You can have a comprehensive grievance process. You can have deeply held values on the wall, behavioural frameworks, leadership principles and employee handbooks. Chuck in a culture playbook if you want. None of them tells me what it's actually like to work for your manager. That's revealed in behaviour.
What happens when somebody makes a mistake? What happens when performance drops? What happens when somebody challenges a decision? What happens when a complaint is raised? What happens when the manager is under pressure? That's culture. And increasingly, that's risk too.
One of Aliya's Sticky Notes at the end of our conversation was to
audit behaviour, not just the paperwork.
I think that's a really useful challenge. If you're preparing for employment law changes, don't only ask whether your policies are up to date. Ask what actually happens in your teams. Are managers having regular performance conversations? Are expectations clear? Are problems addressed early? Are similar situations treated consistently? Do managers know when they should act themselves and when they should seek advice? And perhaps most importantly:
Are they capable and confident enough to do it?
Management is a professional capability
This is perhaps the biggest point I took from the conversation. We need to stop treating management as an intuitive skill people absorb through promotion. Because the responsibilities we're handing managers today are enormous.
We're asking them to balance empathy with accountability. To coach and challenge. To give feedback. To deal with conflict. To understand individual differences. To create psychological safety without dropping performance standards. To make fair decisions. To communicate change. To notice when somebody needs support. To deal with behaviour. To navigate difficult conversations. And, yes, to operate within an increasingly significant legal framework that comes with bigger potential financial and legal consequences for failure than ever before.
That's quite a job description. So why would we assume people can simply work it out?
Aliya's challenge was to give management the same development we'd give any other business-critical discipline: practise it, coach it and hold people accountable for it. That doesn't mean sending somebody on a two-day course and ticking the "manager trained" box.
Capability is built through learning, practice, feedback, coaching, reflection and the opportunity to try again. It's developed over time. Because knowing what a good conversation looks like in theory and being able to have one when somebody is upset, defensive or angry are two very different things.
So, is your leadership ready?
The Employment Rights Act is changing the environment in which organisations operate.
Government guidance is already encouraging employers to prepare for the January 2027 unfair-dismissal reforms, including reviewing how probation and dismissal processes will work with the shorter qualifying period. Review the policies. Check the contracts. Understand the legislation. Get good advice. But don't stop there. Because the document sitting in your HR system isn't the thing managing your people.
Your managers are.
Perhaps the more useful question therefore isn't simply:
"Are we legally ready for these changes?"
It's:
"Are our managers ready?"
Ready to set expectations. Ready to give feedback. Ready to challenge behaviour. Ready to deal with underperformance. Ready to listen. Ready to make fair decisions. Ready to have difficult conversations before they become crises. Ready to ask for help when they need it. Because the standard of management organisations should aspire to hasn't suddenly changed. Good managers should have been doing these things anyway. What's changing is the consequence of failing to equip them to do it. And perhaps that's the real wake-up call here.
The cost of poor leadership has just gone up.
This article was inspired by my Sticky From The Inside conversation with Aliya Vigor-Robertson, co-founder of JourneyHR, exploring what the changing employment law landscape means for leadership, management capability and the everyday experience of work.
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