If you've ever thought "we've got two years to see if they work out", that thinking needs to change. From 1 January 2027, anyone who has worked for you for six months can bring an unfair dismissal claim, and there's no longer a cap on what a tribunal can award them.
I want to be clear that this isn't a reason to panic or to stop hiring. Most of the small business owners I work with are fair people who would never dream of treating someone badly. The risk usually comes from something much more ordinary: a probation period that exists in the contract but never really happens in practice.
Who does this affect?
Everyone already on your payroll, not just new starters. If someone joined you before July 2026, they'll have six months' service by New Year's Day and will be protected from that date. So it's worth looking at your team list now and asking yourself whether there's anyone you have real concerns about.
The bit most people miss: notice counts
This one catches people out. When you dismiss someone without giving them their notice, the law treats their employment as running on until the end of the statutory minimum notice they should have had, which is one week once they've been with you a month. That extra week counts towards their six months.
In practice, that means a decision made at five months and three weeks can tip someone over the line. I'd suggest you plan to have any end of probation conversation by around the five month mark, which gives you breathing space to do it properly.
Making probation actually work
Good probation isn't complicated, and it's mostly about having honest conversations early rather than saving everything up for the final review. Here is what I'd put in place:
- A shorter probation period. Four months, with the option to extend by one month, keeps your decision point comfortably before six months.
- Regular check ins. A quick sit down at the end of months one, two and three, with a few notes afterwards, is usually enough. Talk about what's going well, what needs to improve and what support they need from you.
- Clear expectations from day one. People can only meet the standard if they know what it is, so write it down and talk it through in their first week.
- Managers who feel able to speak up. Many problems drift simply because a manager didn't feel confident raising them, and a little coaching goes a long way here.
What if it's already not working?
Have the conversation now, and do it fairly. Explain your concerns, give the person a genuine chance to respond and improve, and keep a short record of what was said. If you do decide to end their employment, follow a proper process, because that protects you whatever their length of service and it's simply the right way to treat someone.
The upside
New starters who get regular, honest feedback settle in faster and tend to stay longer. So while this change is often talked about as a risk, it's also a nudge towards the kind of onboarding that makes teams better, and that's the part of HR I enjoy most.
If you'd like a second pair of eyes on your contracts or probation process before January, book your free 30 minute HR chat and we can talk it through. You'll find every other change in our Employment Rights Act 2025 guide.
This article is general guidance rather than legal advice, and reflects the law at the date of publication.