UK legal sector thrives with demand for employment and popularity of international arbitration

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The UK legal sector is witnessing a significant surge in demand for employment lawyers, driven by sweeping reforms in employment rights. Meanwhile, London continues to be the preferred choice for international arbitration, according to new research.  

Employment lawyers are in high demand as law firms and businesses prepare for the changes that will be brought about by the Employment Rights Bill, which was introduced by the Labour government in October 2024. The bill, which aims to overhaul employment rights in the UK, includes 28 reforms such as ending exploitative zero-hour contracts, banning fire and rehire tactics and extending employment rights from day one.

As the bill nears its final stages in parliament, employment lawyers are said to be busier than ever. A report by recruitment consultancy EJ Legal and labour market data and analytics provider Vacancysoft revealed that employment law vacancies rose by nearly 34% in 2024, with employment lawyers accounting for nearly 8% of total legal job openings. Mills & Reeve LLP saw an almost 138% surge in employment law recruitment, while TLT LLP observed a 60% increase.

Find out more about employment law in this Practice Area Profile with Lewis Silkin’s employment partner Paul Gillen.

The managing director of EJ Legal, George Catt, said: “City firms are likely to be placing a greater emphasis on employment law as further regulatory changes coalesce to create demand by multinational corporations for compliance and workforce restructuring advice.”

However, the bill's implementation has raised concerns among businesses about the financial impact of reforms. The government’s own economic analysis highlighted that businesses face around £5 billion in additional annual costs following the workers’ rights legislation.

The UK legal profession is also booming in other practice areas. London continues to be the preferred location for international arbitration, according to a global survey of lawyers by White & Case LLP and the School of International Arbitration at Queen Mary University of London.

The survey, which included 2,402 individuals involved in arbitration, found that 34% of respondents named London as their preferred choice for international arbitration, followed by Hong Kong and Singapore. In addition, London ranked among the top five preferred seats for respondents across all six regions of the survey, highlighting its global appeal.

London’s appeal was attributed to support for arbitration by local courts, the neutrality and impartiality of the legal system and national arbitration law, and a strong enforcement track record.

Learn more about the role of international arbitration lawyers from Louise Woods, partner and co-head of international disputes at Vinson & Elkins RLLP.

Speaking on the research finding, international arbitration partner at White & Case, Clare Connellan, said: “The sustained appeal of London and Singapore underscores the importance arbitration users place on judicial reliability and proactive legislative support. Both jurisdictions have made significant legislative advances in recent months, demonstrating a clear political commitment to maintaining their positions as pre-eminent global arbitration hubs.”

The report also highlighted AI innovation in international arbitration, with 90% of respondents expecting to use AI tools for research, data analytics and document review. However, there’s also “strong resistance” from respondents to using AI for tasks requiring discretion and judgment due to concerns over errors and bias.

As the legal sector navigates these dynamic changes, the demand for skilled employment and arbitration lawyers is set to remain high, shaping the landscape for the foreseeable future.