The two-year qualifying period for unfair dismissal has long acted as a strategic safety net for organisations. It provided a generous window to assess a new employee’s cultural fit, technical ability and long-term potential.
However, the Employment Rights Act fundamentally redraws those boundaries. From 1 January 2027, the qualifying period drops to six months. While this might seem like a distant compliance date, the reality is that the shift begins much sooner.
Although this change doesn’t take effect until January 2027, it already affects the people organisations are recruiting today. Anyone who tips over six months’ service after that date will be protected, which means the decisions you make now really matter – Rena Christou, CEO of Empowering People Group
Polling from our recent joint webinar with Talos360, ‘From pre hire to probation: why the six month window changes everything’, shows awareness is growing, but action is lagging:
- 52% have started planning but not yet acted
- 33% are already implementing changes
- 12% haven’t started planning
- 3% are unsure
This means more than half are at risk. As the employees this will impact in Jan 2027 are already being hired today, delaying updates to probation and performance processes now carries legal and operational risk, so building manager capability needs to be prioritised now.
The manager capability gap challenge
Manager capability is a primary source of risk under the Employment Rights Act (EPG research). The reduction of the unfair dismissal qualifying period from two years to six months alone fundamentally alters how probation and performance risk shows up. Yet, many organisations still rely on informal or lightly documented management in early service because they have been able to rely on the two year protection window.
This means performance issues can drift, probations are extended repeatedly, and difficult conversations are delayed. Under the current regime, that approach can go unchallenged, but it will no longer hold after January 2027.
As Rena Christou, CEO of Empowering People Group, explains, “Probation isn’t a legal concept in itself, but how managers manage those early months absolutely matters. Once someone reaches six months’ service, you need to be able to show a fair reason and a fair process if a dismissal is required, and also evidence that the employee has been properly supported.”
From now on, dismissals will require clear evidence of feedback, support and defensible decision-making because weak or inconsistent probation practices will quickly translate into frontline legal risk.
A high-stakes environment for HR leaders
Changes to unfair dismissal compensation further deepen that risk. From January 2027, the compensation cap will no longer be limited to one year’s pay, significantly increasing potential exposure, particularly for higher earners.
Historically, the cap provided a level of financial predictability, often limiting exposure to a year’s gross salary or a set statutory figure. In a post-cap world, the financial risk of an unfair dismissal – particularly for high-earning executives – becomes uncapped and unpredictable.
The impact is cumulative:
- Employees protected earlier
- More scrutiny of process compliance
- Higher settlement and tribunal risk
- Increased pressure on already stretched HR teams
However, as we’ve touched on before, the removal of the compensation cap may not be quite as severe as some anticipate. As Rena explains, “Lifting the compensation cap changes the commercial reality of exits, especially for senior or higher paid roles. It shifts negotiating positions and increases financial risk where processes aren’t robust.”
HR leaders are navigating a significantly heightened risk profile that demands a total overhaul of the probation journey. This needs to evolve now as it is increasingly recognised as an essential component of risk control for managers.
What the HR data says about readiness
The poll undertaken in the webinar highlights a clear gap between awareness and execution. While awareness is high (85%), 1 in 7 organisations have not yet started planning, and a further 2 in 3 have yet to implement changes, meaning many organisations are still reliant on existing probation practices that weren’t designed for six‑month protection. That gap matters because:
- Contracts issued now will still govern employees protected in 2027
- Many six month probations already run beyond the new legal threshold
- Poorly managed early performance will become defensible claims
As Rena warns, “This isn’t something organisations can afford to leave any longer because the risk is already embedded in existing hires and everyday management habits.”
What effective probation looks like
Organisations making the fastest progress are focusing on four practical shifts.
1. Clear probation frameworks
Although probation is not a statutory concept, the processes around it carry legal weight. Employers preparing proactively are reviewing:
- Probation length and extension criteria
- Early service performance standards
- How feedback is recorded
- When and how concerns are escalated
Many are moving towards three-month probation periods with structured reviews and the option to extend, rather than waiting until month six to intervene.
If your probation period runs to six months, you may already be outside the protection buffer the law used to give you. That means being much sharper earlier on – Rena Christou, CEO of Empowering People Group
2. Stronger manager capability
A recurring risk flagged in the webinar was the rise of accidental managers – people promoted for technical performance with a lack of people management experience or training. Under the two year qualifying period, capability gaps were often masked, but with six month protection, those gaps will surface quickly.
This is now a frontline risk that needs to be addressed urgently to ensure managers set expectations early, give timely feedback and take confident action. HR teams are already consumed by tactical people matters, increasing HR case volumes, organisational change and growing absence rates, which is limiting capacity for proactive people strategy.
What’s needed now is a proactive structure and support system for managers, not operating models that involve later intervention. This is why investing in a fit-for-purpose HR operating model, including tech‑enabled outsourcing, is becoming critical to give managers earlier, structured support.
Probation periods can feel like birthdays or anniversaries. If nobody’s watching the date, you only realise too late that it’s arrived – and by then you’re reacting rather than being proactive – Rena Christou, CEO of Empowering People Group
By the time support is requested, options are often already constrained. Common issues include:
- Unclear expectations early on
- Feedback delivered too late, or not at all
- Inconsistent treatment across teams
- Avoidance of early challenge because conversations feel uncomfortable
Rena adds, “Managers often ask for help at the point they’ve had enough. By then, very little has been documented and expectations weren’t set clearly.”
3. Better evidence – not more admin
Earlier protection means evidence matters sooner, without adding bureaucracy. Effective organisations are:
- Capturing performance conversations as they happen
- Having regular performance conversations, not just an annual review
- Maintaining clear audit trails of the conversations
- Using systems to record decisions and actions consistently
With a strong operating model in place, organisations can build manager confidence and consistency and reduce risks escalating to HR.
4. Getting hiring decisions right first time
Probation risk begins well before day one. Poor role definition, rushed recruitment and misaligned expectations significantly increase early exits and legal exposure.
With far less time to correct mistakes once someone has started, organisations need hiring processes that prioritise clarity, consistency and informed decision‑making from the outset.
Clear role scoping, realistic job design and structured hiring decisions reduce the likelihood that probation escalates into an ER issue at all, enabling proactive risk management instead of relying on corrective action later.
Managing the new probation threshold
It’s easy to view January 2027 as a problem for next year. But strategic HR leadership in 2026 is about preparing the groundwork now.
It involves auditing current probation clauses, training managers on the importance of proactively assessing performance and ensuring the technology is in place to track every step of the journey. The probation period safety net has been removed, but with the right processes, the transition from two years to six months can be a catalyst for a high-performing workforce.
Six month unfair dismissal: Next steps
For organisations still in the planning phase, the priority is momentum. That means:
- Reviewing probation lengths and policies
- Stress testing early performance processes
- Assessing manager capability and confidence
- Understanding workload impacts for HR and ER teams
Organisations that act now won’t just be legally safer. They’ll have better run probation processes and stronger management foundations as a result – Rena Christou, CEO of Empowering People Group
Our Group employment law experts have developed a live Employment Rights Act summary and tracker, updated as regulation and guidance changes.
Download the ERA summary and tracker and assess your readiness now.
Catch up on the, ‘From pre-hire to probation: Why the 6-month window changes everything’, webinar and the latest course from our eLearning experts, “Early Days: Managing Probationary Periods“
