Key Changes to HR Departments in the UK To Look Out For Next Year

In the last year, employee rights in the UK have had a monumental shift with the introduction of the Employment Rights Act. Add this to the incorporation of artificial intelligence, faster data analysis, and traditional HR departments for companies vanishing, and there are set to be a lot of changes in the world of human resources over the next year.

So, if you are a business owner, you may be curious about what some of the key changes will be to your HR department, and here, you will be guided through some of the main ones.

Strategically Embedded Tactics

In the past, HR has been linked to recruitment, policies, and admin in most departments around the UK, as well as making sure company compliance is up to code.

However, this is predicted to change in relation to insights into business-decision making becoming more prevalent and organisations expecting HR teams to be more agile. For example, many smaller businesses are outsourcing their HR, to help with changes in business needs and access to specific skills. So, this has led to companies like the HT Dept in Paddington needing to offer set skills at separate times, based on company needs, without having a physical presence.

HR is also predicted to blend more with analytics for businesses, meaning that the people at HR will have more of a say in the direction a company takes. This is because HR departments are now able to access stronger and faster data analytics and can provide more accurate insight into a company’s workforce.

AI and Automation

In case you have been living under a rock, artificial intelligence, or AI, has taken most companies by storm. It should therefore come as no surprise that this has led to it being used to automate many of the HR processes by blending AI with traditional automation methods, leading to faster turnarounds.

This has, of course, been critiqued, as AI is being used to scan CVs, aid in recruitment, and offer predictive analytics to businesses, leading to workforce planning. Critics feel that this has cut out the once essential human connection.

As for automation, it is being incorporated into more businesses, relating to employee portals, mobile apps, and digital attendance recording for staff, eliminating a lot of paperwork.

Evolving Skills Strategy Hiring

It has been predicted that with changes to business models and with the addition of technology, HR departments will be tasked with managing skills-based hiring, rather than just aiming to hit an employee hiring quota.

What does this mean? It points to the change in the UK demographic and employment needs, aiming more at upskilling and reskilling, rather than hiring solely on qualifications. So, rather than hiring people based on their degrees, companies are shifting evermore to hiring people based on their accomplishments and prior experience.

Employees can expect more on-the-job training and job development, which is aligned with each organisation’s strategy. It is also predicted to be less focused on just work output but also on staff development, rather than keeping staff in the same place. So, this will work out well for those who want to advance their careers!

Flexible Working

Since 2020, expectations around flexible working have increased, as more staff push for roles to be made hybrid or remote. The emphasis for staff seems to be leaning more towards well-being and work-life balance, and, as such, HR teams are responding.

HR departments across the UK are predicted to make more formal regulations around flexible working, as well as ensuring that all staff have the right to a better work-life balance and mental health support.

Regulatory and Compliance Pressures Increase

As mentioned in the introduction, the Employment Rights Bill of 2025 is putting additional pressure on HR departments, with legal and regulatory practices being more heavily policed.

In the UK, this bill is set to offer staff “day one rights,” which allows access to maternity and paternity leave from day one in a job, access to more flexibility with work contracts, and stronger data protection. There is also likely to be more emphasis on the HR team to hire people from a range of diverse backgrounds, as well as ensuring that staff also have access to statutory sick pay from day one on the job.

So, whether you run a business, work in a HR department, or even if you are looking for a new job, the role of “Annie in HR” is about to change, and this will have impacts across the UK, as well as on business models and hiring.