1.1. Currently, employees need two years’ continuous service to bring a claim of ordinary unfair dismissal. After two years’ service, an employee can still be dismissed but only if a fair reason (capability, conduct, illegality, redundancy or some other substantial reason) has been relied upon and a fair procedure has been followed.
1.2. With effect from 1 January 2027, the two-year period will reduce to just six months. At the same time, the existing cap on compensation for unfair dismissal, which up until 5 April 2026 (the cap increases every 6 April), is the lower of either £118,223 or 52 weeks’ gross pay, will be removed.
1.3. The changes mean that, any employee who has six months service on 1 January 2027 will be eligible to bring a claim of unfair dismissal. We therefore recommend that employers review their recruitment and probationary processes, perhaps reviewing employees at 3 and 5 months so ensure that decisions regarding an employee’s continued employment are made and communicated to the employee in good time prior to the employee acquiring 6 months’ service.
1.4. Another change is that an employee who is dismissed because they did not disclose a spent conviction or because their employer becomes aware of their spent conviction is no longer required to have any service to bring an unfair dismissal claim on this ground.
Limited access modeSorry, you need to be an HR Protect client to access this content.
HR Protect clients receive all the employment law advice they need across the year, delivered by experienced specialist lawyers, at a single fixed price. In addition, being a client gives you access to our templates, flowcharts and guidance notes on this Hub, where you can also return to your favourites, share content with colleagues, and manage your account.
For a full list of benefits, click here, or enquire to talk to one of our lawyers about how it could work for your organisation, and to receive a bespoke quotation.
Already have an account?
Log in below to access this content.