Employment Tribunal Reform & Rising Delays: What Employers Need to Know

Employers are navigating a period of strategic change in employment law, where multiple pressures are converging. Employment Tribunals are experiencing significant delays, and sweeping reforms under the Employment Rights Act 2025 are reshaping the landscape. 

For businesses, this means greater risk, prolonged uncertainty and an increased need for a proactive management of workplace issues. While these developments are undoubtedly difficult for businesses, they also present an important opportunity to future-proof company policies and strengthen organisation resilience. 

Carol Shaw, Director – Employment at SE-Solicitors, outlines what is changing and how employers can respond.

Why Tribunal Backlogs Now Matter More to Employers 

The latest Ministry of Justice Tribunal Statistics, published on 11 June 2026, highlight the scale of the issue. Between January and March 2026, Employment Tribunals received 11,857 new single claims, a 58% increase on the same period the previous year, but disposed of only 5,450. This imbalance added almost 6,000 cases to the backlog in just three months. As a result, the open caseload has risen sharply to 36,733 single claims, up 136% year-on-year.

Cases are taking longer to be heard and resolved, which prolongs uncertainty, increases legal costs and makes workforce planning more challenging for employers.

More Claims, Bigger Payouts: What’s Coming for Employers 

Looking ahead, the Employment Rights Act 2025 (ERA 2025) is expected to place even greater strain on this already stretched system and significantly increase employer exposure. 

Two of the most impactful changes come into force in the coming years:

• Reduced qualifying period for unfair dismissal claims
  From 1 January 2027, employees will only need six months’ service (down from two years) to bring an unfair dismissal claim.
• Removal of the compensatory award cap
  The current cap on unfair dismissal compensation (set at £123,543 from April 2026) will be removed entirely, increasing the financial exposure for employers.

Government economic analysis (January 2026), estimates that the cumulative impact of the ERA 2025 could increase the number of cases reaching ACAS and Employment Tribunals by around 17%.

In practical terms, more employees will be eligible to bring claims, and those claims may  be significantly more costly.

A Fundamental Shift: Longer Time Limits for Bringing Claims

From 1 October 2026, the time limit for most Employment Tribunal claims will double from three to six months. This is a major shift, and a chance for employers to strengthen processes and reduce risk.

The new six month time limit will apply to core statutory claims including unfair dismissal, discrimination, whistleblowing, TUPE-related claims and breaches of the Working Time Regulations.

The recently published draft regulations (subject to Parliamentary approval) also extend this to additional areas including part‑time and fixed‑term worker rights, information and consultation claims, blacklisting, zero‑hours exclusivity clauses, certain NHS whistleblowing protections, and requests for time off for study or training.

A separate draft order will also extend the time limit for breach of contract claims brought in the Employment Tribunal in England and Wales.

Crucially, the new limit applies where the relevant event took place on or after 1 October 2026. Where a claim is based on a series of events, the last event in that series must fall on or after that date. For breach of contract claims, the relevant date will usually be the effective date of termination. Earlier events will generally remain subject to the current three-month limit. 

What Hasn’t Changed?

While the headline time limits are increasing, some key procedural elements remain the same:

• ACAS Early Conciliation will continue to pause the limitation period while conciliation is ongoing
• Tribunals will retain limited discretion to allow out-of-time claims in certain circumstances

Why This Matters for Employers

Together, these changes signal a more challenging landscape for employers:

• More claims due to expanded eligibility and longer time limits
• Higher value claims following removal of compensation caps
• Longer disputes due to an already congested Tribunal system
• Extended exposure with claims potentially being brought months later than before

This creates both legal and operational challenges. Issues that may have seemed resolved could re-emerge months later, documentation may become harder to retrieve, and key witnesses may no longer be available.

Managing the Risk: A Proactive Approach

While Tribunal issues can’t always be avoided, employers can still minimise their impact by managing risks proactively:

• Record keeping — Keep clear notes of meetings, reviews, and decisions, and hold onto them longer now that time limits have expanded
• Early action — Step in quickly. A simple conversation or mediation can stop problems turning into claims
• Consistency — Apply processes the same way every time. Longer timelines mean inconsistencies are more likely to be challenged
• Policies and training — Refresh HR policies and make sure managers understand them. Many claims arise not from intent, but from poor process or lack of understanding
• Early resolution — With Tribunal delays, settlement discussions or other dispute‑resolution routes can be faster and cheaper

Conclusion

Ultimately, the Employment Tribunal landscape is shifting, and those who invest in strong processes, early advice, and proactive management will be best placed to navigate the changes and avoid costly disputes.

For more information on any of the issues raised in this article, please contact Carol Shaw, Director and Head of Employment Law at SE-Solicitors at cshaw@se-solicitors.co.uk.