Employment Rights Bill: Day One Rights

The upcoming Employment Rights Bill is likely to significantly change how you manage probation periods and dismissals for new employees. With unfair dismissal rights set to apply from day one, employers will need to rethink their approach to onboarding and performance management. 

This article is designed to help employers stay ahead of these changes. You’ll learn what the new statutory ‘initial period of employment’ (IPE) could mean for your contracts, what the ‘lighter touch’ dismissal process involves, and how to align your internal policies with the new legal landscape. By preparing now, you can reduce legal risk and maintain flexibility when managing new hires.  

If you are looking to update your contracts or processes ahead of the changes, our employment law solicitors are on hand to ensure your business is ready. 

What is the current position and what’s changing? 

Probation periods are commonly written into a new employee’s contract of employment. Typically, probation periods last 3- 6 months and are used to assess the suitability and performance of the new employee against the standards required for the role. It’s usual for the contract of employment to specify a shorter notice period to be given by the employer to the employee if they decide to terminate employment during or at the end of the probation period. Currently, employees who have less than two years’ service are generally unable to bring claims for unfair dismissal, meaning employers are usually able to fairly dismiss employees who do not pass their probation period without risk.  

One of the significant changes introduced by the Employment Rights Bill is the removal of the two-year qualifying period for unfair dismissal claims, set to take effect from Autumn 2026. This means employees will be able to bring a claim for unfair dismissal from the day they start their employment, increasing the risk for employers when dismissing employees who fail their probationary period.  

Will I still use probation periods in the same way I do now? 

Not exactly. The Bill also introduces the concept of a statutory ‘initial period of employment’ (IPE) during which it seems there will be some flexibility to dismiss an employee who isn’t right for the job by following a ‘lighter touch process’.   

The details are expected to be published in accompanying regulations, but are likely to include holding a formal meeting with the employee, who will have the right to be accompanied by an employee or trade union representative, to explain the concerns. The employee will also have a statutory right to written reasons for their dismissal after the IPE (employees generally need to have worked for two years to gain this right currently).    

How will these changes affect our current probation periods? 

The ‘new lighter touch’ process will apply during the initial period of employment, regardless of whether a probationary period clause is included in the employee's contract of employment.  

This means that it will be important to ensure that any probation period set out in the contract of employment (including any ability to extend it) is shorter than the statutory IPE (likely to be nine months but still to be confirmed). If the contractual probationary period (including extension) is longer than the IPE the benefit of the clause will be lost because if dismissal takes place after the IPE, a full process will need to be followed for a dismissal to be fair.  

For this reason and to avoid added administration or mistakes when introduced, it may be a good idea to consider aligning any contractual probation periods with the IPE when the full details are known. 

What if we need to make new starters redundant? Will we be able to do this during the IPE using the ‘lighter touch’ process? 

Unfortunately not. Redundancy isn’t included in the list of reasons for when you can dismiss an employee during the IPE. It is likely that you will still be able to dismiss for redundancy during the IPE, but normal unfair dismissal rules will apply rather than the ‘lighter touch’ process. This means employers considering redundancies will need to follow the same fair process for all employees, regardless of length of service, to manage unfair dismissal risk.  

When will these changes take effect, and what should we be doing now? 

The Government has confirmed that the changes to unfair dismissal are unlikely to take place before Autumn 2026 and has said it will openly consult with groups representing businesses and workers on the details before the final regulations are published.   

Although we are awaiting further details, including the length of the IPE and what the lighter touch dismissal process will look like, there are several steps we recommend you start to think about now to prepare:  

• Review recruitment practices to minimise the risk of hiring someone who’s not the right ‘fit’ – for example, you might want to look at your interview process, look at increasing due diligence checks and more rigorous reference checks. 

• Look at how you can manage new employees proactively throughout the probationary period by holding regular meetings with feedback and, importantly, documenting any concerns about performance or conduct. 

• Review contracts, policies and procedures. Update existing probationary period wording in contracts and policies to reflect any changes to the probation performance management process. 

• If you don’t already, it’s a good idea for your contracts to specify a shorter period of notice that employees are entitled to if they are dismissed during the probation period. Also, think about setting reminders in advance of probation periods ending so that notice can be given to terminate in good time and before the end of the IPE. 

Summary 

Until the formal consultations commence later in 2025, and draft regulations are published, there is still a lot of uncertainty around the proposed changes and how it will work in practice.  We’ll keep you updated on any changes as they happen in the coming months.  

As an employer or HR lead preparing for the impact of the Employment Rights Bill, you’ll want to ensure your probation policies and processes are future-proof. Our specialist employment law solicitors can help you review and update employment contracts, align your documentation with the upcoming statutory ‘initial period of employment,’ and reduce the risk of unfair dismissal claims.