For over a decade, employees in Great Britain have needed two years' service before they could claim ordinary unfair dismissal. From 1 January 2027, that qualifying period drops to six months for dismissals taking effect on or after that date. The Government originally proposed making protection a day-one right; Parliament amended the Employment Rights Act to a six-month threshold instead, but the practical effect is still to bring millions of shorter-serving employees within unfair dismissal protection for the first time.
Key facts at a glance
- The qualifying period for ordinary unfair dismissal falls from two years to six months.
- It applies to dismissals taking effect on or after 1 January 2027, which, allowing for notice periods, effectively reaches employees engaged from mid-2026 onwards.
- Automatically unfair dismissals, for whistleblowing, pregnancy, asserting statutory rights and, since February 2026, taking protected industrial action, continue to need no qualifying service at all.
- From October 2026, dismissed employees also have six months instead of three to bring a claim.
Who gains protection?
Any employee with at least six months' service whose dismissal takes effect on or after 1 January 2027 will be able to claim ordinary unfair dismissal. That captures a group employers have historically treated as low-risk: staff dismissed within their first two years, often with minimal process. Under the new regime, a fair reason and a fair procedure will be required from six months onwards, and because unfair dismissal is assessed at the effective date of termination, dismissals decided in late 2026 but taking effect after the new year fall under the new rules.
Probation periods take centre stage
With the two-year buffer gone, the first six months of employment become the critical window for assessing performance and fit. Expect probation periods, extension mechanisms and structured early reviews to move from HR formality to legal front line. Employers who let probation reviews drift past six months will find themselves needing a full fair process to exit an underperformer; employees should expect more rigorous early management, clearer objectives and swifter decisions.
What it means for settlement agreements
For employers
The population of employees who can credibly threaten a tribunal claim expands substantially, and the doubled tribunal time limit from October 2026 lengthens the tail of risk after every exit. Settlement agreements, already the cleanest way to achieve certainty, become relevant far earlier in the employment lifecycle. Budgeting for modest settlement packages on short-service exits is likely to become routine where it was once rare.
For employees
If you are dismissed with between six months' and two years' service after the change, you may hold claims your predecessors simply did not. That directly affects the value of any settlement offer: an employer buying off a real unfair dismissal claim should expect to pay more than one buying mere goodwill. Never sign a settlement agreement without understanding which claims you are giving up and what they are worth, the independent legal advice required for a valid agreement exists precisely for this.
We expect the twelve months either side of commencement to produce a wave of poorly-timed dismissals and undervalued settlement offers as both sides adjust. Whichever side of the table you sit on, the date a dismissal takes effect, not the date it is decided, is what counts. Take advice before you act, not after.
Preparing now
- Employers: redesign probation frameworks with review points well before six months; train line managers on fair process; update template settlement agreements; audit any planned restructures that straddle 1 January 2027.
- Employees: keep records of objectives, feedback and any concerns raised; if an exit is proposed near the commencement date, get advice on how timing affects your rights before agreeing anything.
Frequently asked questions
When does the six-month unfair dismissal rule start?
It applies to dismissals taking effect on or after 1 January 2027. Because notice periods push the effective date of termination later, an employee dismissed with notice in late 2026 may still fall under the new rules.
Is unfair dismissal becoming a day-one right?
No. The original proposal for day-one protection was amended during the Act's passage. The qualifying period reduces to six months rather than being abolished.
Do any dismissal claims still require no qualifying service?
Yes. Automatically unfair dismissals - including those connected to whistleblowing, pregnancy and maternity, health and safety, asserting statutory rights and taking protected industrial action - require no minimum service, before or after the change.
Should employers use settlement agreements for short-service exits?
From 2027, dismissing an employee with more than six months' service without fair reason and process carries genuine tribunal risk, so a settlement agreement will often be the pragmatic route to certainty. Each case turns on its facts, and a solicitor can advise on whether an agreement is proportionate.
Sources and further reading
About this article. This guide is provided by Frederick George for general information only and does not constitute legal advice. Employment law changes frequently and the position described here reflects the law and published government implementation plans as at the date shown above. Frederick George is a legal referral service, not a law firm; for advice on your specific circumstances we will connect you with an SRA-regulated solicitor. Please contact us before relying on any information on this page.
