For many employers, dismissal remains one of the highest-risk areas of employment law. A poorly managed dismissal can lead to grievances, employment tribunal claims, reputational damage and significant legal costs.
The Employment Rights Act 2025 introduces major reforms designed to strengthen employee protections and reshape how employers manage dismissals. One of the most significant changes is the planned reduction of the qualifying period for unfair dismissal protection, giving employees access to rights much earlier in their employment.
For employers, this could increase the importance of recruitment decisions, probationary processes, performance management and workplace documentation. In this guide, we explain what is changing, what the reforms mean for employers and how organisations can prepare.
Unfair dismissal occurs when an employee is dismissed without a fair reason or where the employer fails to follow a fair process. Employment tribunals will generally consider both the reason for dismissal and the steps taken by the employer before reaching a decision. Common fair reasons for dismissal may include misconduct, capability issues, redundancy, statutory restrictions or another substantial business reason. However, even where a potentially fair reason exists, employers must still demonstrate that the process followed was reasonable.
Under current legislation, most employees need two years of continuous service before they can bring an ordinary unfair dismissal claim. This qualifying period has traditionally provided employers with greater flexibility when managing new employees during their early years of employment. While employers must still comply with discrimination laws and other statutory protections, the two-year qualifying period has often been viewed as an important safeguard against unfair dismissal claims.
The Government intends to significantly reduce the qualifying period for unfair dismissal protection. Current implementation plans suggest employees may gain unfair dismissal protection after a much shorter period of service, with six months widely expected to become the new threshold. This would represent one of the most significant changes to dismissal rights in recent decades.
“As a manager, I see this reform as a way to give workers greater job security while encouraging employers to embed fairer, more consistent workplace practices across their organisations.”
Benita Hajdas, General Manager at Circle UK Group
The Government's position is that employees should not have to wait two years before gaining meaningful protection against unfair dismissal. Supporters of the reform argue that workers should have access to legal protections much earlier in their employment relationship. The wider Employment Rights Act programme focuses on increasing workplace security, strengthening employee rights and promoting fair treatment across the labour market.
The practical impact could be significant.
Employers may need to place greater emphasis on recruitment quality, induction processes and performance management during the first months of employment.
The period during which employees can be dismissed with relatively limited unfair dismissal risk will become much shorter.
As a result, organisations may need to strengthen:
Recruitment procedures
Probationary reviews
Performance management processes
Workplace investigations
Record keeping
Manager training
Employee communications
Businesses that already follow good people management practices are likely to adapt more easily.
Many employers are expected to place greater focus on probationary periods once the reforms take effect.
A well-managed probation process allows employers to assess performance, conduct, capability and suitability before unfair dismissal protections become available. Regular review meetings, documented feedback and clear performance expectations may become increasingly important. Managers should ensure concerns are identified and addressed early rather than waiting until issues become more difficult to manage.
As with many employment law reforms, documentation will play a critical role.
Employers should maintain clear records of:
Recruitment decisions
Probation reviews
Performance discussions
Training provided
Workplace concerns
Investigation outcomes
Disciplinary actions
Accurate records help demonstrate fairness and support decision making if disputes arise.
The changes will affect employers across all sectors.
However, businesses with larger workforces, higher employee turnover or operationally demanding environments may experience greater exposure.
This may include:
Construction companies managing large project teams, warehousing and logistics operations employing shift-based workforces, security providers recruiting officers across multiple sites, hospitality businesses experiencing seasonal turnover and retail organisations managing customer-facing teams.
For these sectors, strong onboarding and management practices will become even more important.
Although implementation is expected during 2027, preparation should begin well in advance. Employers should review recruitment procedures, probationary policies and performance management frameworks. Managers should understand how to document concerns, deliver feedback and handle workplace issues consistently. Organisations should also assess whether current policies remain suitable for a workplace environment where employees gain unfair dismissal protection much sooner.
This article is based on guidance and implementation plans published by the UK Government and ACAS.
UK Government – Employment Rights Act Implementation Roadmap
UK Government – Employment Rights Act Factsheets
https://www.gov.uk/government/publications/employment-rights-bill-factsheets
ACAS – Discipline and Grievance Guidance
https://www.acas.org.uk/discipline-and-grievances
The information in this article is intended as general guidance for employers and managers. It should not be relied upon as legal advice. Employment law is subject to change, and the application of legislation may vary depending on individual circumstances.
If you are unsure how the Employment Rights Act 2025 may affect your organisation, we recommend seeking appropriate legal or professional advice.
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Benita Hajdas