Last reviewed: 19.11.2025
What is the current situation?
Employees can currently only claim ordinary unfair dismissal if they have at least two years of continuous service with their employer.
There are exceptions for certain dismissals, including those related to discrimination, whistleblowing or health and safety concerns, all of which are already protected from the first day of employment. Being dismissed for one of these reasons is automatically unfair.
If a tribunal upholds a claim of unfair dismissal, it may award the employee compensation, made up of a basic award (calculated by reference to the employee's age, length of service and ‘week's pay’) and a compensatory award (capped at the lower of £118,223 or 52 weeks' pay from 6 April 2025 and reviewed annually).
On request, employers must give written reasons for dismissal to employees with two years’ service.
So what’s changing and when?
The two-year qualifying period is being removed, meaning that employees will be able to claim ordinary unfair dismissal from the first day of employment.
This means that employers will have to establish a potentially fair reason for dismissal and show that they acted reasonably in all the circumstances (including following a fair process) for every employee, no matter how long the individual has been with the company.
As part of the changes, employers will be able to follow a new ‘light touch’ process in most cases if they wish to dismiss employees during the early stages of employment. This initial period, sometimes referred to as a ‘statutory probationary period’, is expected to be nine months, but this hasn’t been confirmed yet. The ‘light touch’ process will not cover redundancy dismissals or other dismissals which do not relate to the individual (for example for ‘some other substantial reason’ where the reorganisation necessitating the dismissal falls short of redundancy).
There will also be a special compensation regime for employees who are unfairly dismissed during the statutory probationary period (restricted to dismissals that attract the light touch process).
If requested, employers will need to give written reasons for dismissal to employees following the initial period.
The Government will consult businesses on these reforms, including the length of the initial period, the compensation regime and how the light touch process during the statutory probationary period will work in practice. The reforms are expected to take effect in 2027.
What you need to do now
The timing of some of these actions will depend on when the detail of the new laws is finalised and when the changes come into force. However, you can start to plan now:
- Review your recruitment procedures to ensure that new hires are well-suited to your organisation. Tighten up your application, interview and pre-employment screening process to ensure thorough due diligence on incoming employees. The costs of getting it wrong will become higher.
- Review the template contract you use for new hires to make it as robust as possible.
- Consider your current use of contractual probationary periods, to assess whether you will align these with the new statutory probationary periods and what you may need to improve. Consider in particular:
- their length
- which roles you use them for
- their purpose (for example: ensuring compatibility of a new hire with their role; disapplying certain HR policies; applying a shorter notice period; access to benefits etc.)
- how effective they are currently. Do your managers proactively engage with probationary periods, for example properly managing performance/conduct/attendance during them?
- Amend (as appropriate) contractual probationary periods or, if you do not currently operate them, consider introducing into your contracts.
- Amend your probationary policy or, if you do not currently have such a policy, consider introducing one.
- Update your performance management/conduct/attendance management processes and train your managers. The changes will make it harder for you to dismiss employees early in their service, even potentially where there is a ‘light touch process’ available to establish fairness. Do your managers need upskilling for this?
How we can help
- Sign up to our updates as the legal changes come in, so you can stay compliant and up to date.
- We have detailed HR and employment law guidance, template policies and letters on our website in the HR & Legal Resources section, which will be maintained as the changes come into force.
- Our team of employment lawyers is happy to help if you’ve got questions or need advice. And if you need hands-on support with any projects as you prepare for the changes, our HR and legal consultants can work with you to get the right steps in place and stay compliant.
- Use our ERB enquiry line - [email protected] for real-time access to legal specialists when you need quick answers about the Employment Rights Bill.
- Ask about our Right track review (coming soon): A focused, in-business audit with clear, practical steps to keep you compliant.
- You can also shape future policy. We speak regularly with Government and feed into consultations, using input from businesses like yours.
Ongoing employment law and HR support
- For longer-term support, our retained service includes:
- Direct access to employment law experts.
- Regularly updated HR policies and templates.
- Advice for day-to-day issues and bigger picture planning.
- The chance to help shape Government policy.
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