Day-one unfair dismissal rights removed from the Employment Rights Bill
The UK Government has confirmed a significant change to its approach on unfair dismissal rights under the upcoming Employment Rights Bill, which is set to impact how employers manage recruitment, probation, and early performance decisions.
While the original proposal would have introduced day-one unfair dismissal rights for all employees, this plan has now been withdrawn.
Following concerns that it could discourage recruitment and create uncertainty for employers, the qualifying period has instead been reduced from two years to six months.
This change brings both relief and new responsibilities for employers and reinforces the importance of strong HR processes from the outset.
What was originally proposed?
Under the initial proposal, the Bill aimed to remove the two-year qualifying period entirely, giving employees protection against unfair dismissal from their first day of employment.
This was intended to sit alongside a statutory probationary period to offer employers some flexibility in the early stages of employment.
However, the proposal attracted widespread criticism from employers and the House of Lords, particularly around its impact on small and growing businesses.
In response, the Government has adopted a more pragmatic approach that seeks to balance employee protection with employers’ need to manage risk and performance effectively.
What has changed?
The revised proposal is expected to pass through Parliament and take effect in April 2026.
Key changes include:
- A new six-month qualifying period for general unfair dismissal claims
- No statutory probationary period being introduced
- Existing day-one protections remaining in place, including discrimination, whistleblowing, and health and safety
- A potential review of the unfair dismissal compensation cap following consultation
While the headline risk of day-one claims has been removed, the shorter qualifying period significantly narrows the window for decision-making.
What this means for employers
A six-month qualifying period places greater pressure on employers to get recruitment, onboarding, and early performance management right.
With less time to assess whether an employee is the right fit, businesses will need clearer probation structures, regular check-ins, and better documentation. Relying on informal processes or delayed reviews will carry greater risk.
From an HR perspective, this means:
- More robust recruitment processes to reduce the risk of poor hires
- Clear probation expectations communicated from day one
- Structured reviews with documented outcomes
- Early support or intervention where performance concerns arise
Best practice would include a formal review at around three months, followed by a clear assessment closer to the five-month mark, giving employers time to make informed decisions before rights apply.
Updating HR processes ahead of 2026
The Employment Rights Bill highlights the growing importance of proactive, people-focused HR.
With the obstacle of the unfair dismissal change out of the way, the Bill is expected to receive Royal Assent soon.
Employers should be reviewing employment contracts, onboarding processes, probation policies and manager training well in advance of the changes coming into force.
The Bill also includes wider reforms, such as enhanced day-one paternity rights and strengthened whistleblowing protections relating to sexual harassment.
Together, these changes underline the need for joined-up HR policies that are compliant and clearly communicated.
How Moore Thompson’s HR service can support you
Moore Thompson’s dedicated HR service works with employers to put strong employment practices and policies in place.
With the Employment Rights Bill approaching, now is the time to ensure your HR processes are fit for purpose and ready for the changes ahead.
To find out more about the HR services offered by MT HR, please get in touch.