What's new in employment law: February 2026

Every month we summarise the key employment law developments from the previous month that you need to know about. We cover important recent cases, new legislation and other changes in this area.

Please note: this article is up-to-date as at 31 January 2026. Employment law develops rapidly and we will include any further updates in our next article.

Case updates

This month we look at four cases, all of which were decided by the Employment Appeal Tribunal (EAT). Our first is Ahmed v Capital Arches Group Ltd, where the EAT looked at whether the employment tribunal (ET) had been right to strike out a discrimination claim that had been filed nearly four years after the alleged discriminatory conduct took place. In Zen Internet Ltd v Stobart, the issue was whether there was a requirement for an employer to follow particular procedural steps when dismissing a senior employee for poor performance. Should the ET have reconsidered its decision to dismiss the claimant's claims when he disclosed new evidence? This was the question in Mayanja v City of Bradford Metropolitan District Council. Lastly, Micro Focus Ltd v Mildenhall is an important decision on collective redundancy consultation. It examined whether the ET should have looked backwards as well as forwards across a 90-day period when deciding whether the collective consultation obligations had been triggered, and whether it should have included redundancies at different group companies.

Ahmed v Capital Arches Group Ltd

In 2022 Mr Ahmed brought claims of age, disability, race, and religion or belief discrimination against his employer arising from his alleged treatment by Bengali Muslim colleagues during Ramadan in 2018. He said he was excluded due to the fact he did not take part in religious activities. He also complained about the actions of his manager after he reported his colleagues' behaviour. Mr Ahmed accused his manager of changing his duties – including assigning heavy manual tasks to him - which affected his health and ultimately contributed to a disability. His employer argued that he had been moved due to productivity issues and in any event his claims were out of time since he did not bring them until nearly four years after the incidents had taken place. At a preliminary hearing, the judge decided that Mr Ahmed's claims had been brought out of time and dismissed them. He appealed.

The EAT upheld the ET's decision to dismiss the claims. It found that the conduct complained of constituted a one-off act in 2018 with continuing consequences, which meant that the time limit for bringing the claims ran from the date of the act. It was not conduct extending over a period of time, where time would run from the end of the period. It was not just and equitable to extend the time limit since this would prejudice the employer due to fading witness memories and the difficulty in tracing former colleagues.

This decision is a reminder that the time limit for bringing a discrimination claim can run from different dates, depending on whether the alleged conduct is a single incident with lasting effects or ongoing behaviour spanning a period of time. It also shows that claimants need strong justification to persuade an ET to extend the time limit. The decision will be relevant to various situations such as failures to promote, demotions and changes in duties, which are likely to be treated as one-off acts.

Zen Internet Ltd v Stobart

Mr Stobart was the CEO of Zen Internet. He was appointed to improve the company's profitability but failed to do so over a four-year period. The chairman raised concerns and expressed a lack of confidence in him. Three weeks later the company dismissed Mr Stobart without following any formal process. He brought a claim for unfair dismissal, which the ET upheld. There was a fair reason for the dismissal (capability) but it was procedurally unfair. The ET decided that Mr Stobart's compensation should be subject to a Polkey deduction (this is a reduction in compensation to reflect the likelihood that the employee would still have been dismissed if a fair procedure had been followed); if Zen Internet had followed a fair process, Mr Stobart would have been fairly dismissed for capability, probably within two months of the board deciding to dismiss him. The company appealed.

The EAT held there was no absolute requirement to warn an employee about performance concerns or give them an opportunity to improve before dismissing them but this is the norm and a failure to follow these steps will normally lead to a finding of unfair dismissal. The EAT also held that ETs are not limited to looking forward from a particular date – such as the date of dismissal or the date notice is given – when considering what the likely outcome would have been had the employer acted fairly. If an employer has moved too quickly to dismiss, a fair dismissal is likely to have happened later so the employee is likely to have suffered a loss. If, however, the employer has taken an unreasonably long time to conduct its disciplinary process, a fair process could have ended with the same outcome but at an earlier date, in which case the employee would not have suffered financial loss. The case was remitted to the same ET to reconsider what might have happened after the chairman raised concerns and the correct length of the period of loss.

This decision confirms that employers do not have to follow a specific process in every dismissal for poor performance. However, it will be unusual for a performance dismissal to be fair if the employee was not warned and given a chance to improve Secondly, the Acas Code of Practice on disciplinary and grievance procedures applies to all employees. Where issues are raised with an employee's performance, employers should document their concerns and ensure the employee is made aware of them and given an opportunity to address them. Employers should follow their own procedures when dismissing for poor performance, for example they may need to put a performance improvement plan in place, in order to reduce the risk of a successful unfair dismissal claim.

Mayanja v City of Bradford Metropolitan District Council

Mr Mayanja identifies as black African. He brought claims against the Council for breach of contract, race discrimination, harassment and victimisation after it stopped progressing his job application for a role as Refugee and New Communities Integration Officer. He claimed he had received an unconditional job offer, which he had accepted. The Council denied having made an offer and said it had only told Mr Mayanja that he was the preferred candidate, although it had asked him for references. It decided not to take his application any further because the references showed that he had made misleading statements in his application. The ET dismissed his claims and found that he was not a credible witness, ordering him to pay £2,000 in costs to the Council on the basis that he had made false claims. Mr Mayanja then found an email from the Council (which the Council accepted was credible) that appeared to show it had made him an unconditional job offer. He applied to the ET to reconsider the liability judgment and the costs award. The ET accepted that the Council's failure to disclose the email was an oversight caused by a new archiving system and was not deliberate. It reconsidered its costs judgment and reduced it to £200. Mr Mayanja appealed.

The EAT upheld the appeal. The new evidence disclosed by Mr Mayanja undermined the ET's finding that he was not a credible witness. The liability and costs judgments made by the ET were therefore set aside and the case was sent back to a new ET to decide.

This decision reminds employers that they need to conduct comprehensive searches when carrying out disclosure in an ET claim and this should cover all IT systems that may contain relevant documents. A failure to do so can lead to additional litigation, as in this case.

Micro Focus Ltd v Mildenhall

Mr Mildenhall was made redundant and brought an ET claim for a protective award under section 188 Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA) for a failure to consult collectively. TULRCA implements the EU Collective Redundancies Directive and requires an employer to consult representatives when proposing to dismiss 20 or more employees as redundant within 90 days. The ET decided that Micro Focus had breached section 188. In light of the European Court of Justice's decision in UQ v Marclean Technologies, an employer who proposes fewer than the threshold number of dismissals within 90 days is subject to the obligation to consult if it subsequently proposes additional dismissals within a period of 90 days that take the total number of employees to be dismissed to 20 or more. The ET was satisfied there was enough evidence to conclude that Micro Focus proposed to dismiss more than 20 employees within a 90-day period. It also held that Micro Focus acted as the “de facto” employer of the employees it proposed to dismiss for the purpose of section 188 and made a protective award of 90 days’ pay. Micro Focus appealed, arguing that the ET had misdirected itself by treating Marclean as entitling it to look backwards as well as forwards when assessing whether it had made a proposal sufficient to trigger the thresholds in section 188, and by treating it as the de facto employer of all UK staff and therefore aggregating individuals who were employed by different legal entities.

The EAT allowed the appeal on both grounds. The ET had misdirected itself in relation to Marclean, which did not affect the proper interpretation of “proposing” in s188. TULRCA looks to whether the employer is proposing to dismiss as redundant 20 or more employees within 90 days, which is a prospective question based on the employer’s future plans. Therefore it applies even if fewer than 20 employees are actually dismissed or if the proposed dismissals do not occur within the envisaged period of 90 days or less but within a longer period. This interpretation is consistent with the objective of the Directive and TULRCA, under which consultation is a means of avoiding redundancies or reducing the number of dismissals. The duty to consult is a forward-looking question based on what the employer is proposing for the future, not a retrospective headcount of dismissals. On the de facto employer point, the EAT held that the duty in section 188 is owed by an employer to individuals who have a contract of employment with it. The ET erred in considering that the thresholds were met because Micro Focus acted as the de facto employer for all UK staff, when there was evidence that some of those individuals were employed by discrete legal entities. The ET should have asked whether Micro Focus was proposing to dismiss as redundant 20 or more employees employed under contracts of employment with it. The case was remitted to the ET to apply the correct legal approach.

This decision is helpful for employers who are carrying out redundancies in batches over a period of time. Marclean was very tricky for employers, as it potentially meant they had to collectively consult and notify the Secretary of State in relation to redundancies that had already occurred if those dismissals plus later ones reached the threshold figure. The EAT has now confirmed that the obligation to consult collectively is triggered by what the employer is proposing for the future, not by a retrospective count of dismissals within a 90-day period. Employers do not therefore have to combine previous and subsequent dismissals over a rolling 90-day period to decide if the duty to consult arises. However, ETs should be alert to attempts to get around the duty to consult by artificially dividing or staggering redundancies. Employers need to document their redundancy proposals and consultation processes thoroughly so that they have evidence if they need it.

Legislation updates

Employment Rights Act 2025

The Government published an updated analysis on 7 January, showing the estimated costs to businesses of the Act to be £1 billion per year when it is fully in force. It has also published an assessment of the legal and economic implications of the Act and further impact assessments.

We stated last month that the Act will be implemented gradually over the next two years. The first key date is 18 February this year, when a number of measures concerning trade unions and industrial action will come into force. They include simplifying requirements on trade unions (including in relation to industrial action and political funds), reducing the information required in industrial action ballot notices and industrial action notices, and increasing protection for employees against dismissal for taking industrial action. The Government has published guidance on the transitional arrangements that will apply.

On 6 April the six-month qualifying period for paternity leave will be abolished, along with the 12-month qualifying period for unpaid parental leave. Employees will no longer be prevented from taking paternity leave after a period of shared parental leave. Employees who gain these rights from 6 April will be able to give notices in relation to their leave from 18 February. More information is here: Stronger parental leave rights to give millions of working families the “security they deserve” - GOV.UK

The Government has confirmed that the provisions regarding unfair dismissal will come into force on 1 January 2027 without further consultation. This includes the six-month qualifying period. From 1 January, employees who already have six months' service or more will be able to bring a claim. Other employees will have protection once they have six months' service. The cap on the compensatory award for unfair dismissal – currently £118,223 or 52 weeks' actual gross pay if less – will be abolished from 1 January next year.

We held an Employment Club webinar on 5 February to unpack the forthcoming changes and explain what you need to do now to start preparing for them. You can find a link to the recording here and a link to the slides here. Our employment law timeline sets out the implementation dates for the Act, with links to useful information.

We will cover implementation dates for the other provisions in the Act in future issues.

Bereaved Partner's Paternity Leave Regulations 2026

We stated last month that bereaved partner's paternity leave would be extended from two weeks to 52 weeks at some point. Draft Regulations have been laid before Parliament that will extend the leave to up to 52 weeks where the child's mother or adopter has died in childbirth or within a year of the birth or adoption placement. They are intended to apply where a bereavement occurs on or after 6 April 2026.

Equality (Race and Disability) Bill

This new Bill is expected to be published in the current Parliamentary session. The Equalities Minister confirmed on 29 January that there is currently no timeline for the Bill but a plan will be coming soon.

Other developments

ET National User Group meeting

Minutes of the 54^th meeting of the National User Group (held on 7 October 2025) have been published. Key points include:

• some ETs are listing into 2028-29 for hearings that will last 10 or more days, although most regions are listing short cases to be heard by the end of the first half of 2026. London South has the longest waiting times
• two large recruitment exercises are underway for salaried judges and non-legal members
• judges are seeing an increased use of AI by unrepresented parties in drafting overly-complex claims, responses and applications, which leads to more applications for interim relief and reconsideration, as well as inflated schedules of loss. This is putting more pressure on the ET system
• there has been a 26% increase in requests for Acas early conciliation in the last year, leading to a five-week wait for allocation
• HMCTS is anticipating a 20% increase in ET claims as a result of the Employment Rights Act 2025.

Whistleblowing reform

The Government has published its anti-corruption strategy 2025, which states that it will explore opportunities to reform the UK whistleblowing framework, including through potential financial incentives (ie paying corporate whistleblowers who report wrongdoing).

Employment status

When the Employment Rights Act 2025 was at the House of Lords report stage, the Government stated that it would publish a consultation on employment status by the end of last year. On 29 January, it confirmed that it intended to tackle the issues with the current framework and aimed to publish the consultation as soon as possible.

For further information about any of these developments, please get in touch with the author or your usual WBD contact.