Employment news in brief - August 2026

Here's our round-up of employment law news for August 2026.

The Department for Business and Trade (DBT) has published its analysis on reforms to zero hours contracts alongside its consultation on the changes it intends to make. The figures provide employers with an early indication of the potential impact of the changes.

The potential costs are huge. Depending on the final rules, direct employer costs are estimated at between £350 million and £2.9 billion a year, with a central estimate of £1.1 billion per year. And that's before many of the practical details have been finalised.

The consultation follows a government review of tipping rules introduced under section 14 of the Employment Rights Act 2025. It also takes account of feedback on how the current law and guidance are working in practice.

An earlier version of the revised Code was laid before Parliament on 29 June 2026, but was withdrawn on 9 July 2026. This consultation follows the government’s announcement that it would consult again.

The consultation document includes a ‘change log’ which sets out the main changes the government has made to the Code that came into force in October 2024.

The consultation closes on 29 September 2026.

Rising mental strain taking toll on UK employees

Mental strain is increasing among UK employees, with new research suggesting that workplace change, job insecurity and new technologies are affecting their wellbeing and productivity.

A study by Headspace found that 41% of employees in organisations with more than 1,000 staff said their mental or cognitive strain had increased over the past year. The biggest pressure was unclear or changing priorities, followed by job security concerns, organisational change and new technologies such as artificial intelligence (AI).

The research also raised concerns about employee engagement. Around one in three workers said they felt emotionally disconnected from work, distrusted leadership or did not feel their mental health needs were properly supported.

Mental strain is also affecting life outside work. Nearly two-thirds of employees said it had affected their relationships with family and friends, while 76% said it had affected their sleep and 74% said it had reduced their ability to focus and be productive.

The study found that most employers didn't have support in place to help them cope (resilience). Some 64% of employees had received no resilience, stress-management or change-management training in the past year. Only 8% said their employer fully met their mental health needs.

Fair Work Agency sets out first-year priorities in new delivery plan

The Fair Work Agency (FWA) has published its 2026/27 Delivery Plan, outlining its priorities for the first year of operation as it brings together labour market enforcement functions into a single body. 

The agency says it wants to make it easier for workers to get support, help employers understand and meet their obligations, and take action against businesses that exploit workers or compete unfairly.

The plan focuses on three areas: delivering services for workers and businesses, building the agency’s capability, and improving enforcement through technology and better use of intelligence. The FWA also plans to improve digital access to services and develop new tools to support compliance.

Unions oppose EHRC guidance on single-sex spaces

Major trade unions and student organisations have criticised new Equality and Human Rights Commission (EHRC) guidance on single-sex spaces. The guidance was introduced earlier this month following the Supreme Court’s ruling that, for the purposes of the Equality Act, the legal definition of a woman is based on biological sex.

Eight unions, representing a combined 3.6 million paying members, have raised concerns about the guidance. Unison said it had received hundreds of reports from members who believe the changes are unworkable, and said it would continue to campaign for trans-inclusive workplaces and legal reform.

The National Union of Students (NUS) has also rejected the guidance. It has encouraged members to support trans-inclusive initiatives on campuses and oppose policies it describes as trans-exclusionary.

Opposition has also come from Unite, GMB, the British Medical Association and the University and College Union since the draft guidance was published in May.

Bullying among top reasons for workplace disciplinary action

Bullying remains one of the most common reasons employers take disciplinary action against staff, according to new research commissioned by Acas. The survey found that 30% of employers had taken disciplinary action for bullying, the same proportion as for theft and rudeness towards colleagues or customers.

Summer hiring rebounds as seasonal jobs market recovers

The UK’s seasonal jobs market is showing signs of recovery, with new figures from the Recruitment and Employment Confederation (REC) showing stronger hiring than last summer.

According to the REC’s latest Labour Market Tracker, there were 1.67 million active job adverts across the UK in July 2026, up 7.7% on the same time last year. Job adverts fell slightly compared with June, but both active and new vacancies remained above July 2025 levels.

The REC said the improvement marks a turnaround from concerns in 2025 about a decline in the traditional summer jobs market. Demand for seasonal workers has been helped by warm weather and a busy programme of sporting, music and cultural events.

Gen Z workers say they are more productive working from home

More than half of Generation Z employees say they are more productive when working from home, according to new research on the workplace preferences of younger workers.

The study found that 53% of Gen Z employees feel more productive working remotely, while 34% said their office design makes it harder to focus, although two-thirds said their workplace does help them to concentrate. 

Researchers said the findings point to a gap between traditional office environments and the needs of younger employees. Concerns included noise, lack of privacy and workplace distractions. Almost a third of respondents said they felt pressure to overwork, and 29% had taken stress-related absence.

Government announces new support package for young people

Thousands more young people will get access to education, training and apprenticeship opportunities under a new government package. The measures aim to remove barriers that prevent young people from accessing technical education and career routes close to home.

The package includes a new bursary of up to £4,500 per year per household to help eligible families manage the financial impact of starting an apprenticeship. The government said the support will help ensure young people are not put off apprenticeships because of possible changes to benefits.

Other measures include thousands more college places, free apprenticeship training for eligible under-25s from August, and up to £8,000 in support for small and medium-sized businesses that hire young apprentices. Together with National Insurance relief for apprentices under 25, the government expects the reforms to help create 50,000 new youth apprenticeships.

Half of UK employees work beyond normal hours every day

More than half of UK employees are working outside their normal hours every day, according to new research on the rise of an “always-on” work culture. The study found that 55% of workers regularly check emails, respond to messages or carry out work tasks outside their contracted hours every day.

Overall, 93% of employees said they work outside normal hours at least occasionally, while 82% do so at least a few times each week. The findings suggest that the line between work and personal life has become blurred for many workers.

The research also found that 91% of employees have worked while ill instead of taking sick leave, with a third saying they do this often. In addition, 92% said they struggle to switch off mentally during time away from work.

Heavy workloads and expectations from management were identified as the main reasons for after-hours working. However, 88% of respondents said their employer respects their right to disconnect, suggesting a gap between workplace policies and employees’ day-to-day experience.

Study highlights rise of ‘fake perks’ in job adverts

A study of almost 10,000 UK job adverts found that many employers still present basic workplace provisions and legal entitlements as employee benefits.

Nearly one in five job adverts promoted at least one legal or basic entitlement as a workplace perk. The most common example was free drinking water, which appeared in 1,009 adverts. Coffee was listed as a perk in 553 adverts.

The study also found that 457 employers promoted training as a benefit, although it is often needed for employees to do their jobs. A further 336 employers listed 28 days’ annual leave, the statutory minimum for many full-time workers, as a perk. This was most common in the charity, social care and sales sectors.

Other examples of so-called “fake perks” included snacks, casual dress, fruit, Christmas parties and pizza. Only one employer advertised a ping-pong table as a benefit.

The research also found a lack of salary transparency. Despite growing expectations from jobseekers, 30% of the adverts did not include any pay information. The study suggested that employers remain inconsistent in how they present pay and benefits.

Our newsletters

We publish monthly employment and education newsletters. If you'd like to be added to the mailing list, please let Joanne Moseley know.