Employment Law in 2025: A Turning Point for Law Firms and Their Talent
- Posted by Chris Eastwood
- November 4, 2025
Employment law in the UK remains in flux, and the ripple effect is being felt across both sides of the profession. As the Government’s Employment Rights Bill continues its passage through Parliament and workplace expectations evolve, law firms are experiencing change in two distinct ways: through the growing demands on their employment law teams and as employers themselves, needing to adapt policies, culture, and compliance.
For firms and employment lawyers alike, this moment is shaping the next chapter in workplace practice, talent attraction, and opportunity.
The Employment Rights Bill: Workload, Opportunity, and Preparation
The Employment Rights Bill is now in its final stages of passage through Parliament. Following multiple defeats in the House of Lords, it remains in the Commons–Lords “ping pong” process at the time of writing.
While the final version of the reforms is still being negotiated, its arrival into law remains expected in late 2025 or early 2026, with most provisions phased through 2026 and 2027.
Newly added to the Bill is the proposal for a Fair Work Agency (FWA), which would oversee compliance and enforcement of workplace standards, signalling a stronger regulatory framework for both employers and advisers.
For employment law teams, this evolving framework is already driving demand from clients seeking to understand and prepare for the forthcoming changes. Firms are increasingly reviewing contracts, working-time policies, and HR procedures in anticipation of reform. For specialist employment lawyers, this is creating greater demand for advisory expertise, tribunal experience, and policy drafting skills.
At the same time, law firms face many of the same challenges as their clients. As employers, they too will need to assess their own compliance, flexible-working practices, and workforce policies to ensure alignment with the new standards once enacted. In that sense, firms are both advisors and participants in this period of reform – and those already preparing are likely to gain a strategic advantage once the legislation takes effect.
The Latest Developments and What They Signal
Peers in the House of Lords have continued to push back on key government amendments, including those relating to guaranteed hours for zero-hours workers, the proposed day-one right to unfair dismissal, and trade-union ballot thresholds. (HR Review)
These defeats have prolonged the Bill’s journey through Parliament, with a final version still to be agreed. Business groups are calling for greater clarity, while ministers have confirmed that they do not intend to dilute the core protections within the Bill. (The Times)
For law firms and employment teams, the result is a period of heightened uncertainty around final implementatihttps://www.thetimes.com/uk/politics/article/employment-rights-bill-labour-x2sdm7hpb?utm_source=chatgpt.comon dates and specific provisions, particularly regarding dismissal rights and union thresholds. Policy and process planning must therefore remain flexible, with templates and advisory documents ready to be amended quickly once the final wording is confirmed.
The introduction of the Fair Work Agency also brings a new enforcement landscape, increasing the potential for regulatory oversight alongside tribunal actions. Against this backdrop, workload planning is becoming more complex as teams juggle client advisory work with their own internal readiness and compliance.
Managing Expectations: The Cultural Shift Inside Firms
The pace of reform mirrors the shift in workforce expectations. Across the profession, employees increasingly value transparency, inclusion, and flexibility, not just in client workplaces but within their own firms.
Hybrid working has matured into a long-term fixture, but questions remain about fairness and consistency. Employment partners are helping clients navigate these issues while HR leaders inside firms manage the same challenges themselves.
With the Employment Tribunal Service still facing significant backlog pressures, and claims linked to discrimination, harassment, and hybrid-working disputes on the rise, employment teams continue to see strong demand for both contentious and advisory work.
This creates more opportunity for growth, but also more competition for experienced lawyers who can combine technical expertise with empathy and commercial understanding.
What It Means for Hiring
At Clayton Legal, we continue to see clear trends shaping the employment law market. And, simply put demand is highest for lawyers who:
- Can interpret complex legislation clearly and advise diverse client bases
- Have a balanced mix of contentious and non-contentious experience
- Understand both the legal framework and the organisational psychology of workplace change
For those working within employment law, these changes underline just how integral this practice area has become to firm strategy. Employment teams are expanding, diversifying, and increasingly sitting at the heart of board-level conversations about people, culture, and risk. For lawyers specialising in this area, it is an opportunity to deepen expertise, move into more strategic roles, or explore firms whose values align more closely with their own.
The competition for employment law specialists remains strong, with mid- to senior-level roles among the most sought after across the sector. Firms are also reviewing how they present themselves as employers, ensuring their own workplace practices align with the values they promote externally.
Firms able to demonstrate genuine flexibility, progressive culture, and strong internal engagement are best placed to attract and retain leading talent in this climate.
Preparing for 2026: Strategy and Stability
While most reforms are not expected to take full effect until 2026 and into 2027, firms that prepare now, both for clients and for their own workforce, will be best positioned.
Practical steps include:
- Reviewing client-advisory materials to ensure readiness for the new rights framework
- Auditing internal policies for compliance with forthcoming obligations
- Training partners and associates on the implications of the Fair Work Agency and extended tribunal time limits
- Partnering with a specialist recruiter to secure senior expertise and nurture junior talent in advance of increased market demand
The next phase of employment law reform will redefine how employers operate and how legal teams structure, advise, and grow.
Looking Ahead
For employment lawyers, this remains a period of real momentum and opportunity, with new areas of expertise emerging and team structures evolving to meet client and regulatory demand. Many firms are expanding their employment practices, creating opportunities for lawyers who want to take on more strategic or advisory work in a rapidly developing area of law.
For law firms, it is a reminder that people strategies and client strategies are now deeply connected. The firms that thrive will be those that invest in their people, build balanced teams, and foster cultures that reflect the fairness and flexibility they help clients to achieve.
At Clayton Legal, we work with employment law professionals and firms across the UK to help them navigate this evolving landscape. Whether you are building your team or exploring your next career move, our specialist consultants can help you make the right connections for the future.
About Clayton Legal
Clayton Legal has been partnering with law firms across the country since 1999 and during that time has built up an enviable reputation for trust and reliability. We have made over 5,000 placements from partners to legal executives, solicitors to paralegals, and legal IT personnel to practice managers.
If you are looking for your next career move, we can help.