7 HR developments to keep an eye on in 2025 

The most significant piece of legislation for HR professionals in a decade, the upcoming Employment Bill¹ looks to expand and enhance workers’ rights. The Bill is wide ranging with changes such as; removing the qualifying period for claiming unfair dismissal, increase pay transparency reporting and expand protection for gig workers.

For HR leaders, the implications of the Employment Bill are profound. Policies will need to be reviewed and updated. This may require additional training for HR teams and managers to understand the nuances of the new rights and how to implement them effectively. Additionally, leaders will need to communicate these changes clearly to employees, fostering an environment of transparency and trust, especially on issues relating to pay.

The shift towards remote and hybrid working models has transformed the workplace, and the UK government is expected to formalise regulations around flexible working. The anticipated changes will grant employees the right to request flexible working arrangements from the outset of their employment and will mean employers cannot refuse requests based on specific business reasons.

This presents both challenges and opportunities for HR leaders. On one hand, businesses must be prepared to accommodate these requests, which may require a cultural shift in how work is perceived and managed. On the other hand, embracing flexible working may lead to increased employee satisfaction, retention, and productivity. Leaders will need to develop clear policies and guidelines for managing flexible working requests, ensuring that all employees feel supported while maintaining operational efficiency.

The importance of mental health in the workplace has gained significant attention in recent years, and this trend is expected to continue into 2025. HR leaders may face increasing pressure to implement comprehensive mental health and wellbeing strategies that support employees' emotional and psychological needs.

This may include initiatives such as mental health awareness training² to educate line managers and employees on the key symptoms of common mental health conditions and how to spot early warning signs. By investing in these initiatives, businesses can create a supportive environment that not only enhances employee wellbeing but also improves overall productivity and engagement.³

Diversity, equity, and inclusion (DEI) have become critical focal points for organisations, and HR directors must ensure that their companies are not only compliant with existing regulations but are also actively promoting an inclusive workplace culture. The Workers Rights Bill will require employers to develop new DEI frameworks which will require comprehensive diversity and inclusion training for all staff. 

HR leaders will need to consider how they will implement training programmes that educate employees about unconscious bias, as well as developing recruitment strategies that attract a diverse talent pool. Additionally, establishing employee resource groups can provide support and a sense of community for underrepresented employees, fostering a culture of belonging.

Leading on from DEI, the EU Pay Transparency Directive⁴, set to be fully implemented by 2026, will introduce stricter obligations for pay transparency across EU member states. While the UK is no longer bound by EU legislation, UK employers with EU based operations will need to comply with the directive’s requirements, such as disclosing gender pay gaps and providing salary ranges in job advertisements. This development is likely to reignite domestic debates around pay transparency in the UK, where similar measures have been proposed but not yet mandated. 

With growing pressure for more equitable pay practices, it is plausible that the UK government will revisit its own approach to pay transparency in response to both international trends and competitive pressures.

With the ongoing evolution of data protection laws, including the UK General Data Protection Regulation (GDPR), HR leaders must remain vigilant in ensuring compliance regarding employee data handling and privacy. As businesses increasingly rely on technology to manage HR processes, the importance of safeguarding employee information cannot be overstated.

HR leaders should conduct regular audits of their data protection practices, ensuring that all employee data is collected, stored, and processed in compliance with legal requirements. Additionally, providing training for HR staff on data protection best practices will help mitigate risks and protect the organisation from potential breaches.

As the UK government focuses on upskilling the workforce, through the establishment of Skills England⁵, HR directors will play a crucial role in implementing training and development programmes that align with these initiatives. This is particularly important in light of rapid technological advancements that are reshaping industries.

HR leaders should assess the skills gaps within their organisations and develop targeted training programmes that equip employees with the necessary skills to thrive in a changing environment. By fostering a culture of continuous learning, businesses can enhance employee engagement and retention while ensuring they remain competitive in the marketplace.

1. commonslibrary.parliament.uk/research-briefings/cbp-10109/
2. mercer.com/en-gb/solutions/health-and-benefits/employee-benefits-technology-platforms/mental-health-awareness-for-all/
3. journals.plos.org/plosone/article?id=10.1371/journal.pone.0306065#sec013-well-being-pays-off/
4. mercer.com/insights/talent-and-transformation/diversity-equity-and-inclusion/achieving-equal-pay-under-the-new-eu-pay-transparency-directive/
5. gov.uk/government/collections/skills-england/