Employment Rights Bill series | July amendments: NDA changes and more

The expansive and detailed Employment Rights Bill (ERB_ continues its passage through Parliament, most recently being subject to scrutiny by a House of Lords Committee. Next up is the House of Lords ‘report stage’, which is a further opportunity for the Bill to be carefully examined and debated. 

This week (7 July 2025), in advance of the report stage, several important amendments to the ERB were tabled by the government which significantly alter the scope and impact of the legislation as currently drafted. 

Key proposals include a ‘ban’ on the use of non-disclosure agreements (NDAs) in discrimination and harassment cases, and a new right to bereavement leave for parents who suffer a pregnancy loss before 24 weeks. 

Crucial changes are also proposed to the details of the ERB’s new ‘fire and rehire’ regime, as well as its provisions on ‘guaranteed hours’ for workers on Zero-Hours contracts or other low-hours arrangements.

Non-disclosure Agreements (Clause 22)

The government has been under pressure for some time to introduce formal restrictions on the use of non-disclosure agreements (NDAs) in an employment context. The term ‘NDA’ refers to a confidentiality clause in any agreement which prevents an employee from disclosing any information about the agreement, or the circumstances surrounding it, to a third party. 

It is already the case that employers are prohibited from using an NDA to prevent an employee from making a ‘protected disclosure’ under whistleblowing legislation. The draft ERB already specifies that any allegation of sexual harassment should be deemed a ‘protected disclosure’ and subject to existing restrictions on NDA use. 

However, the government amendments of 7 July will, if passed, go further and render void any clause in an agreement between an employer and worker (including an employment contract) which precludes the worker from making any allegation of, or disclosure of information relating to, any ‘relevant’ harassment or discrimination’.  The proposal covers current and former employees and workers (and may be extended by secondary legislation to cover other groups such as contractors or trainees). 

‘Relevant’ harassment refers to all types of discrimination and harassment in employment except for victimisation, and the duty to make reasonable adjustments (in disability discrimination cases). It is not entirely clear why these two potential heads of claim are not covered. It also appears that ‘third party harassment’ (i.e. the harassment of an employee by a third party such as a client or customer) will not fall within the definition (although it is unclear whether this is intentional or an oversight which might be rectified in due course). 

The ban will not apply to ‘excepted agreements’. We don’t yet know which agreements will be ‘excepted’ as this will be set out in secondary legislation. However, a government press release has suggested that the type of settlement agreement commonly used to terminate employment or settle employment disputes will not be ‘excepted’ and will be subject to NDA restrictions. The position is unclear in relation to COT3 agreements (used to settle employment disputes via ACAS). We will update you as more information becomes available. 

If settlement agreements and COT3 agreements are not ‘excepted’ this may have unintended consequences. For example, employers may be very reluctant to settle harassment and discrimination claims if they are unable to guarantee confidentiality or mitigate reputational risk. 

It is unclear when these measures will come into effect as they were not addressed in the government’s implementation roadmap, published on 1 July 2025. 

It is important to note that, separately, a ban on NDAs in Higher Education settings will come into force on 1 August 2025. 

Miscarriage Leave (Clause 18)

Under current law, parents who lose a child under 18, or suffer a still-birth after 24 weeks of pregnancy are entitled to two week’s parental bereavement leave (with statutory pay if they have at least 26 weeks service). 

The ERB already proposes to extend the existing right to parental bereavement leave to a more general type of bereavement leave, covering a range of close relationships. 

However, this week’s amendments specifically extend the rights of prospective parents, introducing an entitlement to at least 1 week’s leave where pregnancy loss occurs before the 24-week mark. This new right has been referred to in the press as ‘miscarriage leave’ but is simply referred to as ‘bereavement leave’ in the draft legislation. It follows on from a Women and Equalities Committee (WEC) report of January 2025 which highlighted the apparent lack of support for employees experiencing pregnancy loss. 

Secondary legislation will be needed to fill in some key details, including the which relationships to the person experiencing pregnancy loss, or the child who has not survived, will be eligible. It is anticipated that the right will apply to a broad range of situations where a pregnancy does not progress (for example, unsuccessful IVF implementation or medical emergencies such as ectopic pregnancies). It is currently not specified that pre-24-week leave must be paid. 

The government has committed to consulting on bereavement leave (presumably including pre-24-week leave) in autumn 2025, with the implementation roadmap indicating that the new right to bereavement leave will come into effect in 2027.

Fire and Rehire (Clause 26)

The proposed ‘ban’ on ‘fire and rehire’ practices, as originally set out in the ERB, is extremely restrictive, effectively preventing employers from implementing any contractual changes unless the business as a whole is facing financial ruin. Read our previous update.

Following significant pushback from employers and business lobby groups, this week’s amendments seek to soften the edges of this proposal, stating that a ‘fire and rehire’ dismissal will only be automatically unfair if a ‘restricted variation’ of contract, relating to core contractual terms, has taken place. The use of ‘variation clauses’ allowing employers to unilaterally vary employee contracts will also be restricted. 

A fuller analysis of these important provisions will follow very soon. 

Zero-Hours/Low-Hours contracts (Clause 1 onwards)

The government amendments also propose changes to the existing provisions extending the right to ‘guaranteed hours’ to agency workers. Read our previous update. In summary, the amendments seek to ensure that an agency worker’s terms and conditions do not deteriorate if they accept a guaranteed hours offer, while also protecting employers from being bound to pay inflated agency rates on an ongoing basis.

Again, a fuller analysis of these provisions will follow very soon.

Comment

All of the above proposed amendments were introduced by the government, and so are likely to be accepted by Parliament and passed into law. 

Other proposed amendments to the Bill, introduced by other members of Parliament (including numerous suggestions to simplify the ‘guaranteed hours’ regime) remain on the table but are unlikely to be passed without government support. The purpose of these proposed amendments is primarily to prompt debate and to ensure that all important aspects of the Bill are fully scrutinised. We will report on any non-government proposals that appear to be gaining traction or attracting government interest as the Bill progresses. 

The House of Lords Report Stage will commence on 14 July 2025 with further sittings scheduled for 16, 21 and 23 July. Once this stage is completed, the Bill will have it’s ‘third reading’ in the House of Lords, before returning to the House of Common for its final stages. 

However, this processed will be paused between 24 July, when Parliament breaks for the summer, and 1 September, when MPs return for the Autumn session.

Previous insights in our ERB Series

Employment Right Bill Series: Implementation Roadmap – a long and winding road (Partner, Mark Landon and Principal Associate, Suzanne Nulty) 8 July 2025

Employment Right Bill Series: House of Lords Stages completed (Principal Associate, Suzanne Nulty) 26 June 2025

Employment Rights Bill Series: The House of Lords Stages so far (Principal Associate, Suzanne Nulty) 6 June 2025

Employment Rights Bill Series: Employment Rights Bill moves from Commons to Lords (Principal Associate, Suzanne Nulty) 25 March 2025

Employment Rights Bill Series continued (Principal Associate, Suzanne Nulty) 7 March 2025

Employment Rights Bill Series: Zero Hours Contracts and Guaranteed Hours: A Zero-Sum policy? (Principal Associate, Louise Singh) 27 January 2025

Employment Rights Bill Series: Small but significant changes to the statutory sick pay system (Principal Associate, Ashley Powis) 13 December 2024

Employment Rights Bill Series: First set of proposed amendments: what it means and what to expect (Principal Associate, Suzanne Nulty) 6 December 2024

Employment Rights Bill Series: Further rules on fair tipping (Principal Associate, Ashley Powis) 3 December 2024

Employment Rights Bill Series: Dismissal and Re-engagement - Tying the Hands of employers? (Legal Director, Ross Hutchison) 22 November 2024

Employment Rights Bill Series: The Fair Work Agency (Principal Associate, Suzanne Nulty) 15 November 2024

Employment Rights Bill Series: The Pendulum Swings on Industrial Relation (Partner Andrew Forrest and Principal Associate, Louise Singh) 8 November 2024

Employment Rights Bill Series: Day 1 right to claim unfair dismissal (Principal Associate, Suzanne Nulty and Associate, Lauren Barchet) 25 October 2024

Employment Right Bill Series – Flexible Working “Further Flexion” (Principal Associate, Suzanne Nulty) 21 October 2024

The Employment Rights Bill Series: 2024 – What’s in, What’s out, and What’s next (Principal Associates, Louise Singh and Suzanne Nulty) 11 October 2024