Five 2026 legal updates for businesses

With the new year upon us, businesses, owners and landlords are set to face a wave of legal changes that will affect how they employ people, structure assets and manage property and compliance obligations. Here, we take a closer look into five 2026 legal updates for businesses to be aware of.  

From major Employment Rights Bill reforms to changes in business relief for inheritance tax, the legal landscape for businesses is shifting quickly. Commercial landlords and tenants will also need to prepare for a proposed ban on upward-only rent reviews, as well as the practical impact of the Renters Rights Act 2025. Alongside this, Companies House verification requirements have introduced new compliance duties for directors and owners to be mindful of.

Are you prepared for the changes coming in 2026, and how might they affect your people, property and long-term business planning?

Employment Rights Bill reforms

There are a number of key reforms being introduced to the Employment Rights Bill in 2026, including:

• Protection from unfair dismissal from day one, removing the current two-year service requirement.
• Fire and rehire: prohibits dismissals for refusing unfavourable contract changes, treating them as automatically unfair.
• Zero-hours contracts: workers get the right to guaranteed hours, reasonable notice for shifts, and pay for cancelled shifts.
• Day-one leave: paternity, parental, and carer’s leave entitlements become available from the first day of employment
• Bereavement leave: a new statutory right to time off for bereavement, including after pregnancy loss, is introduced.
• Sexual harassment: Employers have a proactive duty to prevent harassment, including by third parties (like customers).

If you are unsure about how the Employment Rights Bill will impact your organisation, please get in touch with our experienced employment law & business immigration team.

Companies House verification requirements introduced

On 18 November 2025, new Companies House identity verification requirements were brought into effect, meaning all new and existing company directors, LLP members and those with significant control are now required to complete mandatory identification verification.

Directors may be disqualified from acting if they continue to act as a director without verifying their identity and non-compliance with the requirements may result in the company and its officers being guilty of an offence under the ECCTA.

Read more about the ECCTA and Companies House verification requirements from our corporate & commercial team.

Ban on Upward Only Rent Reviews progressing through parliament

In July 2025, the English Devolution and Community Empowerment Bill proposed a ban on Upward Only Rent Review (UORR) clauses in commercial leases.

While the ban would signal a move towards more flexible rent review structures, for commercial property landlords it could mean a shift from guaranteed income stability to greater market risk.

Although the bill is currently moving through parliament, 2026 is a crucial time for landlords and tenants of commercial properties to prepare for changes by revising documents and exploring new rent review models.

Read more from our expert real estate team.

Changes to Business Relief for inheritance tax

From 6 April 2026, business relief for inheritance tax will be capped. The first £1 million of combined business and agricultural property will qualify for 100% relief, with only 50% relief on value above that threshold.

“What is certain is that the clock is ticking and now is the time to make the difficult decisions,” says Willans’ wills, trusts and probate partner, Rachel Sugden.

“It is more important than ever that business owners seek the advice and assistance of their advisors to protect the future of their business.”

New legislation to impact the residential property rental market

The Renters’ Rights Act 2025, which received Royal Assent in October, is anticipated to reshape the rental market in 2026, placing new responsibilities on landlords while aiming to create a fairer system.

The new legislation will come into effect on 1 May 2026 and introduces new compliance requirements, operational changes and strategic considerations that landlords must prepare for.

Read more about the key actions for landlords from our experienced landlord and tenant disputes team.

If you are unsure how you may be impacted by upcoming 2026 legal updates for businesses, our solicitors in Cheltenham would be happy to help.