Five steps for HR: Preparing for unfair dismissal rights under two years

The Employment Rights Act 2025 (ERA) is the biggest shake-up to UK employment law in a generation. One of the biggest changes is that employees will gain unfair dismissal protection after just six months (down from two years) from 1 January 2027.

Rena Christou, COO of Empowering People Group notes, “This is a huge change that means employees hired in 2026 will gain unfair dismissal protection a year sooner than they would have today, fundamentally changing how managers handle the critical early moments of employment”.

Yet, new research reveals a concerning gap between awareness and readiness:

• 85% of HR leaders are aware of the upcoming changes
• Only 17% have done an impact assessment and 1 in 6 haven’t started one at all
• Manager capability and tribunal risk top the list of HR concerns.

This highlights vital vulnerabilities that need a systematic HR approach.

Probation periods matter more than ever

Since the two-year qualification period for unfair dismissal was introduced more than a decade ago, probationary periods have often been more of a tick-box exercise, or worse, forgotten about entirely. Managers had a much longer window in which to dismiss a poor performing employee, but that window will shrink to just six months.

Organisations will face exposure to costly tribunal claims if managers mishandle the early phase of the employment lifecycle. Our own analysis of probation data projects the following impact:

• Probation tasks could increase by up to 230%;
• This increase would require up to 13% more ER advisory resource;
• That would mean one extra advisor in every eight, at a time when HR resources are already at capacity.

Rena adds, “Reducing unfair dismissal protection during a period of economic volatility could also have a knock-on impact on recruitment confidence, making employers more hesitant to hire less experienced talent. ‘Stagnation by regulation’ is a significant risk for the employment market and it will be hugely detrimental to the UK economy.”

But this needn’t be the case if managers are properly trained and aware of their responsibility in assessing new hires and managing performance effectively in the early stages of the employment. To prepare for this seismic impact, HR leaders need to act now.

Five steps HR leaders need to take now

1. Values-driven recruitment & inclusive onboarding

A great recruitment and onboarding process is now an imperative, not a nice to have. Every candidate deserves a fair process that recognises their skills, potential and individuality. Rather than relying on ‘cultural fit,’ which can reinforce unconscious bias, organisations should focus on ‘cultural add’, which focuses on what unique perspectives, experiences or strengths a candidate can bring to the existing culture to build stronger, more diverse teams.

Embedding accessibility into recruitment allows employees to thrive from day one. Clear job descriptions, competency-based interviews and objective assessments ensure that all candidates, including disabled and neurodivergent applicants, are evaluated on their abilities effectively.

Contracts, probation policies and onboarding plans must also be updated to reflect the new six-month unfair dismissal protection and updated employee rights. But paperwork alone does not provide support. Managers require practical training to confidently navigate the changes, with clear processes to guide new hires through the critical first months.

Training is vital and should include inclusive interviewing, objective performance tracking and the proactive implementation of reasonable adjustments. With these skills, managers can replace the ‘fear of the unknown’ with a clear, equitable framework for early success. Explore how Empowering People Group can help.

2. Equip managers to support and assess probation

Managers act as the first line of defence against legal and people risks, but many are promoted for technical expertise rather than management experience. Without proper training, organisations may face challenges if managers lack confidence in handling probationary periods effectively. Even high-performing employees require ongoing support and feedback to succeed.

Rena adds, “Ongoing development should be part of every manager’s practice. Accessible tools, coaching and practical resources help managers handle difficult conversations confidently. They need to know that failing to follow fair processes – especially around performance or conduct – can lead to tribunals. So, in this new legislative era, the most vital shift is for managers to understand how to properly utilise probation periods to assess the fit of a new hire”.

Organisations that prioritise prevention and enablement are equipping managers with the right tools, training and support to manage performance fairly from day one. Training is a significant part of that process, which is why we’ve developed a specific course designed to improve manager capability in managing probation periods confidently.

Register interest in finding out about our new managing probation periods course.

3. Embedding data-driven HR decisions

Reliable, centralised data provides HR leaders with insight into the root causes of early unfair dismissal claims. By connecting people data, case trends and manager behaviours, HR can identify patterns early – whether it’s inconsistent decision-making, weak performance management, or gaps in manager capability. This enables proactive intervention, reducing disputes, improving fairness and targeting support where it is most needed.

Achieving this level of insight requires fit-for-purpose ER case management tools that capture employee relations data consistently and centrally – a true single source of truth. With timely dashboards and visibility of data in one place, HR can identify trends and risks quickly, making it easier to intervene early, support managers and reduce disputes before they escalate.

4. Make thorough documentation non-negotiable

Keeping accurate, consistent records is fundamental to protecting the organisation from legal exposure. Every performance improvement plan, probation extension or disciplinary conversation must be documented clearly and stored securely.

However, the latest research highlights that 77% of organisations use spreadsheets as their primary tool to manage employee relations cases. Relying on fragmented spreadsheets, paper records and email trails creates additional risk, as data can be inconsistent, or difficult to access when it is needed most.

Rena notes, “With tribunal windows now stretching to six months, a solid audit trail is more important than ever. Clear, accurate records of the support and warnings given by managers are essential to defend dismissal decisions with transparency and confidence”.

Moving to a centralised, reliable documentation system improves processes, reduces administrative burden, supports better decision-making and provides a foundation to scale operations efficiently. This frees HR to focus on strategic priorities and naturally leads into rethinking the HR operating model.

5. Rethink your HR operating model now

Waiting until early performance concerns escalate is a losing strategy. With probation tasks projected to increase, the traditional operating model – where every people issue funnels back to a central HR team – simply won’t scale.

A systematic approach combines the right technology with access to external employee relations expertise. External specialists act as a safety net, supporting managers through difficult dismissals, reasonable adjustments, or sensitive performance conversations.

For particularly complex cases, legal privileged advice provides confidential guidance that cannot be disclosed in a tribunal, helping to protect the organisation and achieve more commercially viable people outcomes. Internal HR teams are then freed from constant firefighting and can focus on strategic priorities.

This approach can be described as Employee Relations as a Service, providing managers step-by-step guidance and clear policies in one place. It ensures records are preserved consistently, reduces errors, gives HR instant clarity, strengthens compliance and supports the development of a future-ready HR strategy.

Building a future-proof HR strategy

These five steps reflect a proactive approach to managing people risk in the new ERA landscape. Organisations that delay transformation may find themselves scrambling to fix compliance challenges rather than shaping a future-ready workforce.

Consistent, compliant people management ensures that every manager follows best-practice processes, every employee receives fair and inclusive treatment, and when issues do arise, the organisation has the evidence and expert support needed to defend its decisions.

Rena advises, “HR leaders that seize this moment to transform their operating model, combining technology, external expertise to empower managers, values-driven hiring, and proactive performance management processes, will be best placed to reduce legal risk, enhance employee experiences and position themselves as employers of choice in the new landscape.”

Stop firefighting and start shaping the future of your workforce – Explore HR transformation solutions today