Overview and key points
With significant changes to employment law on the horizon, businesses need to take a closer look at their employment practices liability (EPL) and management liability (MLP) insurance arrangements.
For the recruitment sector, these changes will not only affect your own business, but your clients will equally need to be ahead of the game to remain competitive – and compliant.
In this article we will look at the three key changes, their impact and how to protect your organisation.
The 3 key changes to employment law
According to Beazley, the proposed changes to employment law are expected to impact EPL claims, particularly in relation to three key reforms:
- 1. Unfair dismissal: Day-one rights could drive more claims
One of the most impactful changes proposed is the removal of the two-year qualifying period for unfair dismissal claims. If passed, employees will be able to bring a claim from day one of employment.
- 2. Flexible working: Stricter rules for refusals
While employees already have the right to request flexible working, the new bill will make it harder for employers to refuse such requests. Employers will need to justify refusals more robustly, showing that their reasons are reasonable and compliant.
Hybrid working could also bring about an increase in requests for flexible working, with many companies returning to the pre-pandemic model of requiring employees to work from an office full time.
- 3. Harassment protections: Higher standards, higher stakes
The bill also proposes a shift from requiring employers to take “reasonable steps” to prevent workplace harassment to taking “all reasonable steps” to prevent any such incidents. There are also changes to the liability of employers where employees are harassed by third parties, as well as whistleblowing protection for those who report sexual harassment.
The impact of these changes is that claims for harassment may well increase in number as well as in value, with employment tribunals being given the ability to increase compensation in the event of a successful claim by up to 25%.
The numbers were already climbing
Even before these reforms take effect, tribunal claims are on the rise:
- Total claims rose from 86,000 to 97,000 in the 2023–24 period.
- Unfair dismissal average award: £13,749 (up from £11,914).
- Age discrimination average award: £102,891 (up from £14,210).
- Sex discrimination maximum award: £995,128.(Tribunals statistics quarterly: April to June 2024 – GOV.UK)
These figures don’t include legal fees, early conciliation costs, or reputational damage—just the tribunal awards themselves.
Protecting your business: why EPL and MLP insurance matters more than ever
With the risk landscape evolving, comprehensive insurance coverage is essential. Management liability policies play a critical role in helping organisations manage these exposures.
A strong EPL or MLP policy can help firms:
- Cover legal defence costs, settlements, and tribunal awards.
- Access expert legal advice early in a dispute.
- Use proactive tools like HR helplines and document templates to prevent claims before they arise.
Get support today
The proposed employment law reforms are set to reshape the risk profile for businesses. Reviewing your EPL and MLP insurance now ensures you’re not only compliant—but also protected.
If you’re unsure whether your current insurance arrangements provide this level of protection, or would like to discuss EPL / MLP further, our dedicated team of advisers would be happy to assist.
For more on this topic – Employment law changes 2025: 3 key impacts on your business
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