If the last few months are anything to go by, we can expect big changes for the HR sector next year. Improvements in technology, employment law reforms, and workers’ evolving needs mean the HR function needs a long-term strategy in place to manage change while ensuring stability across the business.

HR as the bridge for transformation

In 2025, HR will play a larger role than ever in translating the impact of digital transformation across businesses, ensuring that technology aligns with human needs. Companies are advancing their digital journeys at pace, but a gap remains in how these transformations are communicated to employees.

HR teams will be tasked with working alongside different business functions, including IT, marketing and internal communications, to help introduce new technologies and ensure employees understand how they can use any new solutions and the benefits to them. Employees also need to be provided with an opportunity to air any concerns as a way of ensuring they feel encouraged and empowered to embrace technological change across the business.

However, while 12% of employees use generative AI every day, and over 80% of them believe it will help them work more efficiently, many are unsure about where to start.

A key focus for HR will be helping employees see how they can work with new technology, particularly AI, to enhance their roles rather than feeling threatened by it. The rise in AI discussions has sparked fears about job redundancies, and HR will be central in helping employees understand how AI will impact their roles in a reassuring way. By positioning themselves as the custodians of positive communications, HR will show employees that the human element in the workplace becomes even more important as AI integrates into their day-to-day role.

A predictive approach to legislative changes

As legislation continues to evolve, HR teams will shift from a reactive to proactive approach to workforce changes. Whether its labour reforms announced in the Employment Rights Bill or the more recent Get Britain Working white paper, HR professionals will be actively involved in designing policies that ensure businesses remain compliant and ahead of the curve when it comes to employee rights.

This proactive approach will involve reviewing the onboarding process to make sure job expectations are clear from the start. By addressing legislative changes early, HR will create a consistent employee experience, ensuring that staff feel supported not just during recruitment, but throughout their entire employment lifecycle. This focus on transparency and employee support will be key to retaining top talent in 2025.

Clarifying hybrid work models

Hybrid and flexible working arrangements have been a popular topic in recent years, but 2025 will see HR teams take a clearer and more decisive approach. With increased demand for flexible work due to ongoing global challenges and personal lifestyle preferences, businesses will need consistent policies around how and where employees work. HR teams will need to work with leadership to establish guidelines and ensure these policies are adhered to across all departments.

While flexibility will remain important, it’s clear that not every organisation can adopt the same approach. According to JLL’s ‘Future of Work Survey’ over a third of  companies (39%) are thinking about offering different pay and benefits for those who work in the office regularly compared to those who work fully remotely, and 37% are considering providing more workspaces closer to where employees live.

On the other hand, one-third of companies are thinking about going fully remote by 2030, with no office space, and relying entirely on virtual spaces. HR will be key in explaining why certain flexible working policies are in place, helping employees understand the business needs and ensuring fairness for everyone.

A skills-first approach to recruitment and retention

The focus on skills over job titles will continue to gain momentum in 2025. According to MHR research, 71% of UK employees say that managers aren’t offering sufficient support to develop their careers with two-thirds saying they would leave within a year if there were no opportunities for growth. Employers are at risk of losing talent because they’re not using their people’s skills properly, and they have a responsibility here to make sure they are providing their employees with the right opportunities.

As businesses increasingly adopt a skills-first approach, HR will need to review employees’ skills and match them to projects based on their skills, rather than traditional job roles. This shift will encourage agility and flexibility within organisations, allowing employees to contribute to areas where they excel and helping them to develop in new, exciting ways.

This “match-and-gap” approach will become more common, where employees are matched to projects based on their strengths and areas for development. HR teams will be instrumental in facilitating this skills-first culture, ensuring that employees are provided with the chance to thrive and develop long-term within the organisation.

As we look to 2025, the HR profession will be at the heart of ensuring the business sticks to a shared vision and goals, provides people with the autonomy and empowerment they deserve, and enables a culture of learning and growth. If these elements are prioritised, then HR professionals will help ensure their company is set up to become sustainable and high-performing.