Employment Rights Act 1996
What this means for your business
- Enforced by
- MMO
- Applies to
- United Kingdom
- On this page
- 56 compliance obligations, 18 practical guides across 4 topics
What you must do
56 compliance obligations under this legislation.
Management duties 11
Allow and respect employee parental leave requests
You must not unreasonably delay, refuse or try to prevent an employee from taking statutory parental leave. If an employee thinks you have done so, they can bring a claim to an employment tribunal within three months (or a reasonable extension). The tribunal can declare the employer in breach and order compensation.
Allow employee carer’s leave without unreasonable delay
You must let an employee take carer’s leave when they request it and you cannot postpone the leave without a good reason or try to stop them taking it. If you breach this, the employee can bring a claim to an employment tribunal (usually within three months of the incident) and you may be ordered to pay compensation.
Allow employees time off for public duties
If an employee asks to take time off for a public duty (e.g. jury service, witness, or other statutory duties covered by section 50), you must grant that leave. Failure to do so can lead to an employment‑tribunal claim and the employer may have to pay compensation.
Allow reasonable time off for dependants
You must let an employee take time off to deal with an emergency or illness involving a dependant, as set out in section 57A. If you refuse this without a good reason, the employee can bring a claim to an employment tribunal within three months (or a later reasonable period). The tribunal can declare your refusal unlawful and may order you to pay compensation.
Attend tribunal hearing and state willingness to reinstate or re‑engage employee
If an employee applies to an employment tribunal for interim relief after being dismissed and the tribunal thinks the dismissal may be unfair, you must attend the hearing and tell the tribunal whether you will put the employee back to work (reinstate) or offer them another role on terms no less favourable. If you do not attend or refuse, the tribunal will automatically order that the employee’s contract continues.
Grant at least one week of leave for employees with a child in neonatal care
If an employee’s baby is in a neonatal unit for at least seven consecutive days, and the care started within 28 days of birth, you must allow them to take a minimum one‑week leave. The leave has to be taken before 68 weeks from the child's birth. This applies to all employees in your business.
Grant parental leave of at least three months to eligible employees
If you have employees who have worked long enough and are responsible for a child, you must allow them to take up to at least three months off to care for that child. The leave can be taken in whole or in parts, but the total period cannot be less than three months unless the regulations state otherwise when conditions change. You must follow the rules set out in the regulations made under this Act.
Maintain terms and return rights for employees on parental leave
When one of your staff takes parental leave, you must keep their contractual terms (except pay) in place and expect them to meet any duties attached to those terms. You also have to give them the right to return to a suitable job after the leave, as set out in the regulations. This means updating HR records and planning the employee’s return well in advance.
Maintain terms & conditions and return rights for employees on paternity leave
When one of your staff takes paternity (or related) leave, you must keep their contractual terms (except pay) in place, expect them to continue any duties that arise from those terms, and guarantee they can return to a suitable role with their seniority, pension and other rights as set out in the regulations. This duty continues for the whole period of leave and up to the employee’s return.
Provide at least two weeks paternity leave for eligible employees
If an employee has worked long enough for you and is the father (or partner) of a newborn or expected child and has the required relationship with the child's mother, you must give them at least two weeks’ paternity leave. The leave must be taken within 56 days of the child's birth and cannot be taken if the employee has already taken adoption leave for the same child.
Reinstate dismissed employee and pay back earnings
If an employment tribunal orders you to reinstate a worker you have dismissed, you must put them back into their job as if they had never left. You also have to pay any lost wages, restore seniority, pension rights and any other benefits they would have earned, and do all this by the date the tribunal sets.
Notifications 5
Give employee a written statement of any changes to their terms
If something that was set out in the written statement of employment particulars (for example pay, hours, place of work, or the employer’s name) changes, you must give the employee a new written statement describing the change. This must be done as soon as possible and no later than one month after the change (or earlier if the employee goes abroad to work for more than a month).
Give new shop workers a written statement of Sunday work rights
When you hire a shop worker who may be asked to work on Sundays, you must give them a written statement within two months explaining their right to opt out of Sunday work and to object to extra Sunday hours. If the employee has already given an opting‑out notice, you are treated as having complied.
Give required notice or payment in lieu when ending employment
When you fire or make an employee redundant you must give them a minimum notice period that depends on how long they have worked for you – from one week up to twelve weeks. You can instead pay them instead of giving the notice. Employees must also give you at least one week’s notice when they quit.
Provide shop workers with written rights statement
If you employ a shop worker who may be required to work on Sundays, you must give them a written statement explaining the rights set out in section 41B(2). The statement must be handed to the worker within two months of the commencement date, unless the worker has already submitted a valid opting‑out notice.
Provide supplementary statement of initial employment particulars
When you hire someone, you must give them a written statement of any employment details that are missing from the standard initial particulars, or tell them that there are none. You can point them to other easily‑accessible documents for those details. This must be done within two months of their start date (or before they leave the UK to work abroad for more than a month), even if the employment ends earlier.
Other requirements 2
Comply with tip rules to avoid tribunal claims
If you fail to follow the rules about how and when tips must be paid, a worker has a 12‑month window to take you to an employment tribunal. This means you should make sure you meet sections 27D and 27G on tip handling and keep clear records so you can defend yourself if a complaint is made.
Do not disclose national‑security information in employment proceedings
If a Minister decides that certain employment‑related information would harm national security, you are not required to provide it and you must not reveal it in any court or tribunal case that falls under the Employment Rights Act. In practice, keep such information confidential and refuse to disclose it if a legal claim is made against you.
Payments and fees 28
Allocate and pay qualifying tips, gratuities or service charges
When your business receives a tip, gratuity or service charge that qualifies under the law, you must allocate it to your workers according to the rules in section 27D and then pay the workers their share. The payment has to be made by the end of the month after the month the tip was received from the customer.
Allocate and pay tips fairly to staff
When your business receives tips, gratuities or service charges you must share them fairly among the workers at that site and then pay each worker their share. The allocation must be based on a transparent, fair method, taking into account any relevant code of practice.
Allow agency workers time off and pay due remuneration
If you use agency workers, you must not unreasonably refuse them the statutory time off for antenatal care and you must pay the full remuneration they are entitled to for that time off. A worker can take a tribunal claim if you refuse the leave or fail to pay, and the tribunal can order you to pay double the lost pay plus the amount owed. The claim must be lodged within three months of the appointment (or a later period the tribunal considers reasonable).
Allow antenatal care time off and pay statutory remuneration
You must let pregnant employees take the time off they’re legally entitled to for antenatal appointments and pay them the statutory rate for that time. If you unreasonably refuse the time off or under‑pay, an employment tribunal can order you to pay the amount owed (or double it if you refused the leave). Keep clear records of requests and payments to demonstrate compliance.
Comply with employee time‑off and pay entitlement claims
If an employee asks for the statutory time off for study or training and you refuse it, or if you do not pay the remuneration they are owed, they can take a complaint to an employment tribunal. The tribunal can order you to pay the missing amount, so you must make sure you grant the time off you are required to and pay the full remuneration due.
Comply with tribunal reinstatement or continuation orders and pay compensation
If an employment tribunal orders you to put an employee back to work (re‑instatement, re‑engagement or continuation of their contract) you must follow that order. Failure to do so will result in the tribunal ordering you to pay compensation, which you must also pay promptly.
Limit wage deductions for cash/stock shortages to 10% and within 12 months
If you run a retail business and need to deduct money from an employee’s pay because of a cash shortage or missing stock, you must not take more than 10 % of their gross wages for that day. The first deduction in any series must be made within 12 months of when you became aware (or should have become aware) of the shortage.
Notify worker and demand payment in writing on a pay day for cash shortages
If a retail employee pays you back for a cash shortfall or missing stock, you must first send them a written notice that details the total amount they owe. You then have to issue a written demand for payment on one of their normal pay days (or the next working day if the pay day falls on a non‑working day), and you must do this within 12 months of discovering the shortage. Only after you have followed these steps can you treat the repayment as a normal wage deduction or take legal action.
Pay agency worker after maternity‑related supply end
If you run a temporary work agency and a worker’s assignment to a client stops because the worker is on maternity leave, you must keep paying that worker’s wages for the full length of the original (or likely) assignment. You only stop paying if you offered the worker suitable alternative work and they unreasonably refused it.
Pay agency workers for adoption‑appointment time off
If one of your agency workers takes the paid time off they’re entitled to for adoption appointments, you must calculate the correct hourly rate and pay them for the hours they are absent. The rate is based on a week’s pay divided by their normal weekly hours (or the 12‑week average if hours vary). Any contractual pay you’ve already made for that period counts towards this statutory payment.
Pay agency workers for time off under antenatal care
If you operate a temporary work agency and allow an agency worker to take time off for antenatal appointments, you must still pay them for that period. The payment must be at the worker’s normal hourly rate, calculated from their weekly pay and normal working hours (or the 12‑week average if hours vary). This ensures the worker is not financially disadvantaged for taking the leave.
Pay compensation for unfair dismissal when ordered by tribunal
If an employment tribunal decides that an employee’s unfair dismissal claim is well‑founded and does not make a reinstatement or other order, your business must pay the compensation amount the tribunal awards. The payment is calculated according to the rules in sections 118‑126 of the Employment Rights Act and must be made as directed by the tribunal.
Pay compensation if tribunal finds your breach of employee rights
If an employee (or, in some cases, a temporary work agency or hirer) successfully brings a claim under the Employment Rights Act, the tribunal can order you to pay compensation. The amount must reflect the loss, expenses and benefits the claimant missed, can be reduced if the claimant contributed to the problem, and may be capped for certain non‑employee contracts. You must pay the amount the tribunal decides, within the period it sets.
Pay compensation or arrears ordered by an employment tribunal
If an employee successfully complains that you refused the time off they’re entitled to (section 58) or you didn’t pay them correctly (section 59), the employment tribunal can order you to pay compensation or the outstanding amount. You must pay what the tribunal decides.
Pay compensation ordered by tribunal for unlawful deductions or over‑payments
If an employment tribunal finds a worker’s complaint about an unlawful deduction, over‑payment or a similar breach to be well‑founded, you as the employer must repay the amount taken from the employee and may also have to pay additional compensation as the tribunal decides. This payment obligation only arises when the tribunal makes a formal declaration that the complaint is well‑founded.
Pay employee remuneration for time off if tribunal orders
If an employee complains to an employment tribunal that you have unreasonably refused them time off for employee‑representative duties, or that you have not paid the remuneration they are entitled to, the tribunal can order you to pay the amount owed. You must make that payment (and ensure any future refusals are reasonable). Failure to do so can result in further enforcement action.
Pay employees for antenatal care time off
When an employee takes time off for antenatal appointments (the right under section 55), you must pay them for that period at the appropriate hourly rate. The rate is calculated from their weekly pay divided by their normal weekly hours (or an average if hours vary). Any contractual pay you already give counts towards, and reduces, this statutory payment.
Pay employees for normal hours during notice period
When an employee is serving notice and their contract specifies normal working hours, you must pay them for those hours if they are ready to work but no work is given, are off sick or injured, are on pregnancy‑related leave or other statutory leave, or are on holiday. The payment must be at least the average hourly rate calculated from a week’s pay divided by the normal hours. Any other pay you give (sick pay, holiday pay, etc.) counts towards this liability.
Pay employees for statutory study time off
If you let a young employee take time off for study or training under the right in section 63A, you must pay them for that time at their normal hourly rate. The rate is worked out from their weekly pay divided by their normal weekly hours (or an average if hours vary). This statutory pay counts towards any contractual pay you would already owe for that period.
Pay employees for time off taken as a pension trustee
If you let an employee take time off to act as a pension scheme trustee, you must pay them for that time. You pay as if they had worked the whole period – either at their normal salary or, if their pay varies with work, at their average hourly rate (or a reasonable comparable rate). This payment is separate from any contractual pay but can offset each other.
Pay employees for time off to attend adoption appointments
If you allow an employee to take leave to attend adoption appointments, you must pay them for the hours they miss at their normal hourly rate. The rate is worked out from a week’s pay divided by their normal weekly hours (or a 12‑week average if hours vary). Any contractual pay you already give for that leave counts against this statutory amount, and vice‑versa.
Pay employees for time off under section 61
If you let an employee take time off to carry out trade‑union or employee‑representative duties (the right in section 61), you must pay them for that time. The pay must be at the correct hourly rate, calculated from their normal weekly wage and usual weekly hours (or an average if those vary). Any contractual pay you already make for the same period counts towards this statutory payment.
Pay redundancy payments to eligible employees
If you dismiss an employee because their role is no longer needed, or if they are laid off or put on short‑time work and qualify for redundancy, you must calculate and pay the statutory redundancy amount. This is a payable entitlement that must be honoured as part of the termination process.
Pay remuneration to employees suspended on maternity grounds
If you suspend an employee because they are on maternity grounds, you must continue to pay them their normal wages for the whole suspension period. You only do not have to pay if you offered them suitable alternative work and they unreasonably refused to take it.
Pay statutory redundancy or related entitlement payments
If an employee has worked for you continuously for a period that makes them eligible for a redundancy or other statutory payment, you must pay the amount they are owed. The Secretary of State may later add money from the National Insurance Fund to help cover the payment, but the amount you pay will be deducted from that top‑up.
Pay statutory remuneration for time off to look for work or training
If you let an employee take the time off you must pay them at an appropriate hourly rate – calculated from their weekly pay divided by their normal weekly hours (or the 12‑week average if hours vary). The total you pay cannot exceed 40% of a week's pay. If you wrongly refuse the time off, you still have to pay the same amount.
Pay tribunal‑ordered compensation for a successful employee complaint
If an employee makes a complaint under section 63I and an employment tribunal decides the complaint is well‑founded, your business must pay the compensation the tribunal awards. The amount must be fair in the circumstances but cannot exceed the statutory maximum weeks’ pay set by the Secretary of State.
Provide written itemised pay statement for each wage payment
Every time you pay an employee you must give them a written breakdown of their pay. The slip must show the gross amount, any deductions and why they were made, the net amount, how each part of the net is paid, and the hours worked if pay varies. It has to be handed to the worker at or before the payment is made.
Policies 2
Keep written policy and records on employee information
If your business does not have a written policy covering how employee information is handled, or you fail to keep the records required by the Act, workers can bring a complaint to an employment tribunal. To avoid that, you must keep the policy up to date and maintain the required records.
Provide bereavement leave of at least 2 weeks
If a worker loses a child, you must give them at least two weeks off under the statutory bereavement leave. The leave must be taken within 56 days of the child's death, and each child death gives a separate period of leave. This lets employees grieve while keeping your business running.
Offences and prohibitions 5
Allow employee to work during compulsory maternity leave
Fine up to £500If you let an employee who meets the statutory conditions keep working during a period that must be compulsory maternity leave, you commit a criminal offence. On conviction in the Magistrates' Court you can be fined up to £500. No prison term is attached to this offence.
Corporate offence liability for directors and officers
If your company commits an offence under the Employment Rights Act and the breach was done with the consent, connivance, or because of the neglect of a director, manager, secretary or other similar officer, that individual is also personally guilty. Both the company and the officer can be prosecuted and punished for the same offence.
Fail to comply with information notice
Fine up to £1,000If an employee applies for a statutory payment and the Secretary of State sends you a written notice asking for information or documents, you must comply. Failing to provide the requested material without a reasonable excuse is a criminal offence. On conviction in the Magistrates’ Court you face a fine of up to £1,000.
Fail to give written redundancy payment details
Fine up to £1,000If you, as an employer, do not give an employee a written statement showing how a redundancy payment was calculated and you have no reasonable excuse, you commit an offence. The same offence occurs if you ignore a written request from the employee to provide that statement within the notice period. Either breach can lead to a summary conviction in the Magistrates' Court and a fine – up to £200 for the first breach or up to £1,000 if you fail to comply with the employee’s notice.
Fail to supply information or documents when required
Unlimited fineIf an employer (or any person) receives a written notice from the Secretary of State asking for information or records and they refuse, wilfully neglect, or provide false statements, they commit a criminal offence. Refusing or neglecting can lead to a summary‑court fine of up to £1,000, while knowingly giving false information can result in an unlimited fine. Convictions are dealt with in the magistrates’ court.
Record keeping 3
Provide accurate pay statements and notify all deductions
You must give every employee a pay statement that includes all the details required by law, and any deductions must be clearly explained in that statement. If an employment tribunal finds that a statement was missing required details or that deductions were not notified, you may be ordered to repay the unnotified deductions made in the previous 13 weeks.
Provide an accurate written statement of reasons for dismissal
When you dismiss an employee you must give them a written statement explaining why they were dismissed, and the explanation must be clear, complete and truthful. If you fail to do so, the employee can take a complaint to an employment tribunal, which may order you to pay them two weeks’ wages.
Provide written statement of reasons for dismissal
When you dismiss an employee you must give them a written explanation of why they were dismissed. The employee can ask for this in writing and you must supply it within 14 days, unless they are pregnant, on maternity leave or adoption leave – in those cases you must give it automatically. The duty only applies if the employee has at least two years’ continuous service, except for the protected maternity/parental situations.
Penalties for non-compliance
5 penalties under this legislation. 1 carry an unlimited fine.
Fail to supply information or documents when required
Unlimited fine
Fail to comply with information notice
Fine up to £1,000
Fail to give written redundancy payment details
Fine up to £1,000
Allow employee to work during compulsory maternity leave
Fine up to £500
Corporate offence liability for directors and officers
Penalty applies
Practical guidance
Our guides explain how to comply with the requirements above.
Employment & HR 11
Manage redundancies correctly
How to make employees redundant fairly and legally. Covers collective consultation requirements, fair selection criteria, statutory redundancy pay …
Redundancy consultation process
How to conduct redundancy consultations properly. Covers collective consultation requirements, selection criteria, statutory redundancy pay, HR1 notification, and …
The complete employment lifecycle: employer responsibilities from hire to exit
A comprehensive guide to employer responsibilities across every stage of the employment relationship, from lawful advertising and recruitment …
Settlement agreements
How to use settlement agreements to resolve employment disputes. Covers legal requirements, tax treatment of payments, ACAS early …
Employment status: employee, worker, or self-employed
How to correctly determine whether someone is an employee, worker, or self-employed. Covers the key legal tests, IR35 …
Agency worker rights comparison
Quick reference comparing what agency workers are entitled to versus permanent employees.
Mandatory hiring requirements
Every employer obligation from pre-hire through the first month of employment. Covers right to work checks, written statements …
Employment Contracts and Written Statements
Your legal duty to provide written employment terms. Covers the day-1 requirement, mandatory terms, contract types, zero-hours protections, …
Before you hire your first employee
Everything you need to do before employing your first staff member.
Make employees redundant when closing your business
How to make employees redundant when closing your business. Covers statutory redundancy pay calculations, consultation requirements, notice periods, …
Respond to an employment tribunal claim
What to do when a current or former employee brings an employment tribunal claim against your business. Covers …
Sector-Specific 4
Nannies and Au Pairs: Regulations and Employment
Legal requirements, Ofsted registration rules, and employment obligations for nannies and au pairs. Covers when registration is required, …
CIS registration does not determine employment status
Why being CIS-registered does not make someone self-employed. Understand the critical distinction between CIS (a tax collection mechanism) …
Construction tax compliance - how CIS, VAT, CITB, and PAYE work together
An integrated view of construction industry tax obligations showing how CIS deductions, VAT reverse charge, CITB levy, and …
Working time and rest breaks in hospitality
Working Time Regulations explained for hospitality employers including maximum hours, rest break entitlements, split shift rules, night work …
Tax & Finance 2
Maternity and paternity leave
Statutory entitlements for new parents including leave periods and pay rates.
Go full-time with your business
Practical guidance for transitioning from employment to full-time self-employment. Covers financial preparation, legal obligations, tax registration, replacing employer …
Sections and provisions
404 classified provisions from this legislation.
Duties 53
- s.2 Statement of initial particulars: supplementary.
- s.4 Statement of changes.
- s.8 Itemised pay statement.
- s.12 Determination of references.
- s.18 Limits on amount and time of deductions.
- s.20 Limits on method and timing of payments. the employer
- s.24 Determination of complaints. amount ordered
- s.27G When tips etc must be dealt with
- s.27N Complaints to employment tribunal about information An employment tribunal
- s.27D How tips etc must be dealt with An employer
- s.27K Complaints to employment tribunal about tips etc An employment tribunal
- s.41B Explanatory statement: persons who become shop workers
- s.41C Explanatory statement: shop workers at commencement date
- s.49 Remedies. a person
- s.51 Complaints to employment tribunals. An employment tribunal
- s.53 Right to remuneration for time off under section 52.
- s.56 Right to remuneration for time off under section 55.
- s.57B Complaint to employment tribunal. An employment tribunal
- s.57ZK Right to remuneration for time off under section 57ZJ
- s.57 Complaints to employment tribunals. part of any amount
- ... and 33 more duties
Offences and penalties 6
Powers 61
- s.7 Power to require particulars of further matters.
- s.10 Power to amend provisions about pay and standing statements.
- s.27Q Procedure for issue of code of practice
- s.27M Compensation: dealing with tips etc
- s.27R Consequential revision of code of practice
- s.27S Revocation of code of practice
- s.27P Issue of code of practice
- s.27O Determination of complaints about information
- s.31 Limits on amount of and entitlement to guarantee payment.
- s.33 Power to modify provisions about guarantee payments.
- s.42 Explanatory statement : betting workers.
- s.43FA Prescribed persons: duty to report on disclosures of information
- s.43K Extension of meaning of “worker” etc. for Part IVA.
- s.49B Regulations prohibiting discrimination because of protected disclosure
- s.49D Redundancy during a protected period of pregnancy
- s.50 Right to time off for public duties.
- s.63G Regulations about dealing with applications
- s.63K Supplementary
- s.63F Employer's duties in relation to application
- s.63E Section 63D application: supplementary
- ... and 41 more powers
Definitions 75
- s.7A Use of alternative documents to give particulars
- s.11 References to employment tribunals.
- s.15 Right not to have to make payments to employer.
- s.17 Introductory. cash shortage stock deficiency
- s.27A Exclusivity terms unenforceable in zero hours contracts zero hours contract
- s.27X Interpretation
- s.27 Meaning of “wages” etc.
- s.27H Agency workers
- s.27C Qualifying tips, gratuities and service charges
- s.28 Right to guarantee payment.
- s.40 Notice of objection to Sunday working.
- s.41 Opted-out shop workers and betting workers.
- s.41A Notice of objection by shop workers to working additional hours on Sunday
- s.43G Disclosure in other cases.
- s.43ZB Interpretation
- s.43L Other interpretative provisions.
- s.43A Meaning of “protected disclosure”.
- s.43F Disclosure to prescribed person.
- s.43E Disclosure to Minister of the Crown.
- s.52 Right to time off to look for work or arrange training.
- ... and 55 more definitions
Exemptions 72
- s.1 Statement of initial employment particulars.
- Schedule 3 Repeals and revocations
- s.3 Note about disciplinary procedures and pensions.
- s.5 Exclusion from rights to statements.
- s.9 Standing statement of fixed deductions.
- s.13 Right not to suffer unauthorised deductions.
- s.14 Excepted deductions.
- s.16 Excepted payments.
- s.22 Final instalments of wages.
- s.23 Complaints to employment tribunals.
- s.27U No restitution claims by employer
- s.27I Written policy
- s.27B Power to make further provision in relation to zero hours workers
- s.27J Records
- s.27F Independent troncs
- s.29 Exclusions from right to guarantee payment.
- s.35 Exemption orders.
- s.43H Disclosure of exceptionally serious failure.
- s.43M Jury service
- s.44 Health and safety cases.
- ... and 52 more exemptions
Official guidance
Authoritative sources from regulators explaining this legislation.
- Redundancy in Northern Ireland (nidirect) Detailed Guidance
- Collective consultation requirements Detailed Guidance