The impact of the Employment Rights Bill on flexible working and the gender pay gap
The recently published Gender pay gap in the UK: 2025 headlines a 12.8% gender pay gap based on all employees, full-time and part-time. Whilst this has reduced slowly over the past decade, the pace of change has frustrated many, not least female employees.
Drivers of the pay gap are varied and, Melissa Blissett said, should be examined on an organisational level to ensure action planning is directly linked to the underlying factors. However, there are some themes that can be considered societal.
One of these has been persistent lower wages for part-time work, or to put it another way, a lack of opportunity to conduct higher paid roles on a reduced hour basis. This locks women into a trend of flat lined salaries post parenthood, whilst we see father’s careers accelerate. The gender pay gap leaps from a mere 0.9% in the 20-29 age bracket to 12.5% in the over 50s.
Flexible working is a core centre stone for enabling women to combine career progression with parenthood. Whilst this is not a new concept, the Employment Rights Bill will have an impact on current HR processes and procedures.
Jane Van Zyl said that with the new Employment Rights Bill soon to receive Royal Assent, flexible working is set to become a central feature of UK employment practice, with a public consultation on the new flexible working regulations expected in April 2027.
For HR professionals, this represents an opportunity to embed flexibility strategically across roles while enhancing engagement, productivity, retention and wellbeing.
Large employers (250+ employees) should also be aware of the government’s proposed Gender Pay Gap Action Plans, expected to be introduced on a voluntary basis next year and become mandatory from April 2027. Updates and plans will need to be submitted alongside pay gap reports, providing another avenue for HR teams to align flexible working and other policies with broader gender equality objectives.
Shifting workplace culture
Building on the 2023 Flexible Working Act, which gave employees the right to request flexible working from day one, the new Employment Rights Bill proposes to strengthen the right to request by requiring employers to demonstrate genuine reasons for rejecting a request.
This shifts the focus from simply following procedure to whether a rejection is reasonable - a standard tribunals will assess once regulations are finalised following the upcoming 12-week consultation.
For HR teams, this means creating a culture that supports positive outcomes and helps managers explore flexible arrangements that meet both individual and organisational needs. Flexibility should consider term-time hours, job shares and staggered shifts, and can be trialled temporarily to test effectiveness where possible.
Career progression routes for part-time workers should be considered by ensuring access to training, development and ultimately, promotion opportunities. Job sharing and other flexible arrangements can help retain talented employees, particularly women, and provide stepping stones from middle to senior management.
Embedding flexibility
As requests are likely to rise, organisations have an opportunity to review policies and enhanced benefits to better support employees across different life stages. Parents are the obvious ones to benefit, but also consider those with caring responsibilities beyond that, such as those with elderly relatives, kinship carers, or dependants with additional needs.
Support wellbeing
Barnett Waddingham research shows that nine in 10 parents say working flexibly has, or would have, a positive impact on their mental health. HR teams can support this with benefits such as mental health support, employee networks, employee assistance programmes (EAPs) and financial wellbeing resources that extend to all those with caring responsibilities.
Value talent
Flexibility helps employees stay or move into roles that utilise their skills, rather than stepping down to lower skilled positions for more convenient hours. Each request is also a chance to identify gaps in policies and improve employee engagement.
When supported through benefits like enhanced policies or family-friendly networks, employees feel valued across all areas of life.
Recruitment and retention
It’s best practice to make flexible working part of your recruitment process, so that it’s available to new as well as current employees.
Eight out of ten (82%) UK parents would apply for a job that advertised flexible working options, compared to only 31% for jobs that didn’t, so highlighting flexible roles in job adverts can broaden the talent pool and show a supportive culture. Also ensure you consider job design and how you can integrate flexibility into all roles.
Next steps
With the Employment Rights Bill on the horizon, reward and HR teams should begin reviewing their current approach.
- Audit current policies and offerings: Cconsider auditing flexible working policies and practices, to see if you can identify areas for improvement. Review benefits offerings to ensure they offer holistic support, including mental health, financial wellbeing, and across a range of caring responsibilities.
- Provide managerial training: Ensure managers have clear guidance and the required training they need to assess requests fairly, including all the ways different working patterns can integrate flexibility across all roles.
- Monitor the impact of flexible working: Track the impact on earnings and the gender pay gap. Not only does this provide a measure of return for investment but this can also provide helpful narrative alongside gender pay gap reporting.
- Utilise a data-led approach: Whilst enhancements to flexible working will significantly impact women, it’s still important to see this as one element of a wider story. Utilising a pay gap dashboard can deliver deeper data insights and identify additional barriers to women’s progression. These insights enable you to transition to a data-led prioritised action plan, with clear understanding of the impact action planning may have in reducing your gender pay gap.
Employers can check how they measure up by taking the Family-Friendly Workplaces Certification self-assessment. This evaluates your people and culture policies and practices against the Global Work + Family Standards, helping you understand where you stand as a family-friendly employer.
Supplied by REBA Associate Member, Barnett Waddingham
Barnett Waddingham is proud to be a leading independent UK professional services consultancy at the forefront of risk, pensions, investment, and insurance. We work to deliver on our promise to ensure the highest levels of trust, integrity and quality through our purpose and behaviours.
