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The Employment Rights Bill is nearing the end of its parliamentary debate and is set to bring the biggest reforms of UK Employment Law.
With Royal Assent expected in December 2025, employers will face reforms coming into effect from April 2026 through to 2027.
However, the Government has recently announced that it is abandoning plans to introduce day-one unfair dismissal rights.
Employers should prepare clear dismissal policies and procedures and comply with the upcoming Bill.
Head of Dispute Resolution and Employment, Amanda Hyam, explains what you need to know about the upcoming Employment Rights Bill and its recent changes to unfair dismissal.
What was originally proposed in the Employment Rights Bill?
The Government initially proposed to get rid of the two-year qualifying period entirely and planned to support this with a statutory probationary period that would limit employers’ freedom to dismiss in the early months of employment.
However, concerns quickly emerged as employers warned that day-one rights could discourage hiring and the House of Lords warned about the practical impact on small businesses.
To reduce the number of litigation risks, the qualifying period has now been reduced from two years to six months and the day-one rights have been dropped.
The revised Bill, which is expected to be implemented from April 2026, introduces several changes, including:
What does the Bill mean for employers?
The removal of day-one protection may bring some relief for employers, but the new six-month threshold still creates operational challenges.
Employers will have a much shorter window in which they can assess performance and conduct a dismissal before the full unfair dismissal rights apply.
This reduced timeframe means that employers must strengthen their recruitment processes to ensure new hires are suitable from the outset.
When dealing with probation periods, any performance concerns should be raised at the earliest opportunity and supported with clear documentation to justify any decisions made in the first six months of employment.
Employers should carry out a formal probationary review at the three-month point and conduct a final assessment around the five-month stage.
This will allow you sufficient time to reach a well-informed decision about the employee’s future at the company before the qualifying period ends.
With these reforms set to come into effect, employers must review and update their employment contracts and onboarding procedures to ensure compliance.
Planning early for the assessments and management of new employees is crucial and if employers are uncertain about how the new rules affect them, seeking legal advice is important.
How can employers prepare for the Bill?
Employers must remain compliant with the new policies and begin reviewing their internal processes.
Companies should update their employment contracts so that they accurately reflect the new qualifying period and any new procedures.
Managers should be trained in the new dismissal process and how to properly comply with probation periods, including assessing performance and maintaining detailed records.
HR and payroll policies will also be affected and the reforms are likely to impact leave entitlements and sick pay.
Early preparation will help reduce the risk of unfair dismissal claims and allow businesses to be confident in their hiring and management decisions.
Our expert team can help to ensure your policies are compliant and if you still feel unsure, our Employment Law guides can help clarify your rights and obligations.
For expert advice and guidance tailored to your situation, contact us today.
Head of Dispute Resolution and Employment
I have specialised in Dispute Resolution, Civil Litigation and Employment law for more than 15 years. I understand how daunting the prospect of litigation can be and because of this I am always available to discuss concerns.
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