Written by Kirsten McKenzie. This article is up to date as of May 2026.
If you’ve been searching online for ‘Employment Rights Act unfair dismissal’, you’re not alone. The term is still widely used, but as of late 2025, it has a new name: the Employment Rights Act 2025. The legislation passed through the House of Lords in December 2025 and is now on track for implementation over 2026 and 2027, with the reforms related to unfair dismissal coming into effect in 2027.
And it’s big. The planned changes to unfair dismissal are one of the most significant updates to UK employment law in recent decades, fundamentally reshaping when and how employees gain protection from unfair dismissal. If you’re an employer, HR leader or founder, this isn’t a “wait and see” moment. It’s time to get ahead.
From two years to six months: The new standard for unfair dismissal
One of the headline shifts under the Act is the reduction in the qualifying period for unfair dismissal protection.
As it stands, most employees need two years of continuous service to bring an unfair dismissal claim under the Employment Rights Act 1996. That’s now changing.
From 1 January 2027, the qualifying period will be just six months. That means protection kicks in much earlier, and the margin for error in early employment narrows.
Employers can no longer rely on lengthy probationary periods or “wait and see” approaches before tightening performance management or processes. Fairness, documentation and clarity now need to start from day one.
Need help reviewing your ER policies and probation processes? Explore our Employee Relations Services
What constitutes unfair dismissal now?
While the legal definition hasn’t changed dramatically, the context and risk have.
Unfair dismissal occurs when an employee is dismissed without a fair reason or a fair process. The five potentially fair reasons remain:
- Conduct
- Capability or performance
- Redundancy
- Statutory illegality or breach of law
- Some other substantial reason (SOSR)
But with protection starting at six months, tribunal risk increases significantly, especially for employers without clear policies, training, or documentation in place. This is especially important in cases where dismissal overlaps with potential discrimination claims under the Equality Act 2010.
Even dismissals within the first year of employment could now face scrutiny. With the planned removal of the statutory compensation cap on 1 January 2027, employers’ potential financial exposure also increases.
It’s also worth noting that some situations, like dismissal for asserting certain statutory rights, may be classed as automatically unfair dismissal, meaning no qualifying period is required.
What will probationary periods look like?
Probation periods will need a rethink. While these are not legal constructs, they’ve long served as internal checkpoints for employers. But with protection starting at six months, and many probation periods lasting that long, they are no longer a safe buffer.
From 2026 onwards, probationary processes must become more structured and documented. That means:
- Clear expectations set at the job offer stage
- Regular check-ins and performance feedback
- Evidence-based assessments before confirming employment
- A formal decision-making process for extensions or exits
This isn’t just HR admin. It’s risk mitigation. Poor or undocumented probation reviews could result in costly claims, especially under the new regime.
Want to support your managers through this shift? Our Learning and Development for People Managers programmes can help.
What documentation and processes should be in place by 2026?
Update your documentation to reflect changes in dismissal rights and procedures – including a robust, fair dismissal procedure for all employees. Include clearer probation terms, notice periods, and expectations. To prepare for the January 2027 rollout of the six-month rule, here’s what employers should focus on throughout 2026:
1. Employment contracts and handbooks
Update your documentation to reflect changes in dismissal rights and processes. This includes clearer probation terms, notice periods, and employment terms and conditions.
2. Probation review templates
Move from informal chats to structured reviews. Use templates that assess performance, behaviour and culture fit – all linked to role-specific objectives.
3. Manager training
Line managers are your first line of defence. They must be trained to:
- Spot underperformance early
- Deliver feedback constructively
- Escalate concerns appropriately
- Document every step
- Manage employee performance and expectations
- Understand HR processes tied to dismissal and probation
Our learning and development programmes for people managers are designed to build this confidence and capability fast.
Explore our HR Consulting Services to support with policy reviews and performance systems.
4. HR systems and data
If you’re still relying on emails and spreadsheets, it’s time to upgrade. A good HRIS (HR Information System) will allow you to track performance issues, absences, and milestones like review dates or contract end points – all key evidence if dismissal is contested.
Why these changes matter
The aim of the Employment Rights Act 2025 is to level the playing field. The government wants more people to access protection earlier in their employment – especially casual, part-time, zero-hours and agency workers.
But for employers, this shift demands greater professionalism and consistency from day one.
Even basics like working hours, holiday pay or lack of clear communication on these could now spark disputes earlier in employment.
Dismissals that once would have flown under the radar could now lead to:
- Tribunal claims
- Brand damage
- Management time lost
- Legal fees
- Potentially unlimited compensation once the cap is lifted
Early-stage employees can no longer be treated as “low risk”. Fairness, clarity and documentation now start at onboarding.
Other related changes coming in 2026–27
The unfair dismissal rules are part of a much broader reform package. Other key changes under the Act include:
- Day-one rights to Statutory Sick Pay (SSP)
- New bereavement leave entitlements
- Greater protection during pregnancy and maternity leave
- Rights to guaranteed hours for zero-hours contract workers
- Restrictions on fire-and-rehire tactics
Learn more about the full scope of the legislation on our Employment Rights Act support page
What should employers be doing now?
These changes impact both employers and employees, and preparation is essential to avoid costly missteps.
Here’s the action plan for 2026:
- Audit your policies – especially probation, dismissal and grievance procedures
- Train your managers on early-stage performance management and documentation
- Update your contracts – particularly clauses linked to probation and notice
- Review your recruitment processes – ensuring a robust process to mitigate the risk of employing the wrong candidate
- Seek expert advice – especially if you have flexible contracts or dispersed teams
This is about more than compliance. It’s about building a consistent, fair and efficient people experience – and reducing risk while you do it.
We can help. Our Interim HR Services give you immediate on-the-ground support, or tap into our team for longer-term transformation.
How Hunter Adams can help
We’re already supporting clients across the UK to:
- Review and update contracts and policies
- Upskill managers on performance and dismissal handling
- Deliver interim HR support to embed the changes
- Build performance systems that support fair processes
Whether you’re a standalone HR manager, a CPO in a stretched team, or a founder juggling growth and risk, we’ve got the people and expertise to help you transition confidently into this new employment landscape.
Need expert HR advice? Get in touch with us.
Final reflections for the HR team
The move from two-year to six-month unfair dismissal protection is more than a legislative tweak for your HR team; it changes how you support team members from day one, and it’s a mindset shift.
Employers who embrace this now – with better systems, trained managers, and early-stage clarity – will be the ones who stay compliant, reduce risk and build better workplaces.
The clock is ticking. Let’s get ahead of the change.
Contact us today to chat with our experts about your HR needs.
Related articles:
Employment Rights Act support page
Employment Rights Bill: Economic Impact for Employers
When Will the ERB Become Law – A Roadmap for Employers
Update on the Employment Rights Bill
