UK unfair dismissal rights now cover new hires after just 6 months — and employers are spooked
The News
As of 1 July 2026 — two days ago — the UK Employment Rights Act has made a quiet but significant change to the hiring landscape. RSM UK reports that anyone recruited from that date onward gains the right to claim unfair dismissal after just 6 months of continuous service, down from the previous 2-year qualifying period. From 1 January 2027, all employees with at least 6 months' service will be covered — meaning the entire UK workforce will have near day-one dismissal protection within 18 months.
The immediate employer reaction is caution verging on retreat. RSM's workforce survey found that 44% of employers say they will be more cautious when recruiting as a direct result of the rule change; 34% plan to use more off-payroll workers and contractors; and 19% say they will temporarily freeze recruitment altogether. Charlie Barnes, RSM's Head of Employment Legal Services, warned of "unintended consequences leading to increased levels of unemployment."
The employment tribunal system — already carrying a 5-year case backlog — is expected to buckle further. RSM found that 25% of employers think a surge in tribunal claims is "very likely" and another 40% say it is "somewhat likely." RSM recommends employers update contracts immediately: probation periods must not exceed 5 months, line managers need retraining on performance management documentation, and every probation review must be structured and recorded.
Why It Matters
This changes the risk calculus of every UK hire. The old 2-year qualifying period gave employers a long runway to assess new starters and part ways without legal exposure if things didn't work out. That runway is now 6 months — and the documentation burden starts on day one. For TA leaders, this means probation processes move from a nice-to-have to a legal necessity. Every hiring manager who has ever coasted through a probation review with a vague "they're doing fine" is now a liability.
The shift toward contractors and off-payroll workers is the rational short-term response, but it has its own risks — IR35 compliance, workforce continuity, and the slow erosion of permanent headcount that makes long-term capability-building harder. The organisations that over-rotate into contingent labour to avoid dismissal risk may find themselves trading one problem for another.
Taking Action
All action is situated in your corporate context. These are starting points, not prescriptions — choose what fits.
Connect
Who to talk with in your enterprise
Your HR operations and employee relations leads. Have probation processes been tightened? Are there documented check-ins at months 1, 3, and 5 for every new starter? Are line managers trained on what constitutes a fair dismissal process — and what contemporaneous documentation looks like?
Your workforce planning lead. If 34% of peer organisations are shifting toward contractors, what does that do to your permanent hiring plan? Is your contingent workforce strategy robust enough to absorb a market-wide shift without cost escalation?
Inspect
What to take a closer look at
Audit your probation process for a random sample of 10 hires made in the last month. Count how many have: (a) a documented probation policy specifying a period of 5 months or fewer, (b) at least two written review touchpoints with specific performance criteria, and (c) a final sign-off record. If fewer than 8 of 10 meet all three, your process is not ready for the new regime. Then check your employment contract template: does the probation clause still reference a 6-month+ period? If so, it needs updating today.
Reflect
What to think about more deeply
If making it harder to dismiss people makes you more reluctant to hire them, is the Employment Rights Act protecting workers — or shrinking the pool of permanent jobs they can apply for?