The government’s recent U-turn on the Employment Rights Bill was unexpected. The six-month qualifying period for unfair dismissal claims – down from two years – is a critical turning point for HR teams and a catalyst for operational transformation.
Simon Fowler, CEO of Empowering People Group said, “The focus for every organisation must now shift to hyper-efficient onboarding, improved performance management, and robust, well-documented probationary periods that meet this new six-month standard. Line manager training and capability is going to be a critical investment area.”
Add the removal of the compensation cap for unfair dismissal claims, and the stakes climb even higher. Legal safety nets won’t protect organisations from the consequences of inefficient processes.
The HR transformation opportunity
HR transformation is vital to mitigating legal risk, reducing operational costs, and alleviating strain on HR teams. Genuine HR transformation does not increase workload, it establishes streamlined systems that prevent issues from escalating.
Rena Christou, COO of Empowering People Group, said, “This change doesn’t reduce the operational burden on HR and the need for robust onboarding and probationary processes. It makes manager training an urgent priority.”
Our new ERB research highlights the scale of unpreparedness:
- 1 in 6 organisations haven’t started an impact assessment
- 46% say AI is making claims more complex and increasing the volume of claims
- 77% still rely on basic spreadsheets for managing employee relations cases.
With the margin for error shrinking, it’s essential to ensure onboarding, probation and performance management processes are robust and hyper-efficient from day one of employment. Review and reinforce your performance management processes now to stay ahead and protect your organisation in this new era of employee rights.
3 steps to transform HR
1. Prevention over reaction: Employee relations case volumes are rising at alarming rates. Training managers to resolve issues at the source is essential. When line managers handle 70% of ER tasks, internal teams focus on strategic work, not firefighting.
2. Enhancing HR data efficiency: HR collects vast amounts of data, but outdated systems can limit the visibility of trends and actionable insights. Fit-for-purpose case management and AI tools can surface patters, flag risks early and accelerate ER case resolution.
But technology alone won’t fix broken processes. The value comes from connecting insight to action and reducing the cycle from problem identification to resolution. Making the right investment is crucial.
3. Outsourcing external HR support: 63% of UK employers already outsource HR functions (CIPD). 57% plan to increase outsourcing in 2025. Why? Specialist skills, legal complexity, and consistency.
Internal teams stretched across competing priorities create bottlenecks, but external employee relations experts provide a dedicated partnership without internal bias or resource gaps.
The new operating model: ER-as-a-Service
AI-literate employees are filing longer, more detailed grievances and managing cases takes more time. Organisations need to look beyond solutions that simply promise ‘better’ case management and instead pivot to operating models that proactively prevent cases through early intervention and improved manager capability.
Employee Relations as a Service (ERaaS) is becoming a true service model, where:
- Data drives decisions, not assumptions
- Technology accelerates resolution, not replacement
- External partners provide stability and expertise
- HR teams focus on prevention, culture and strategic workforce planning
Organisations using ER-as-a-Service (ERaaS) models report up to 60% reductions in tribunal cases and thousands saved annually.
Next steps for HR teams
The six-month window for unfair dismissal is a transformation trigger. Those that bolt new policies onto broken processes will drown in operational burden.
- Audit your onboarding process: Are there delays, unclear expectations and missing documentation?
- Assess manager capability: Can they identify and resolve issues in real-time?
- Map your ER data: Where are patterns? Where are bottlenecks?
- Evaluate your operating model: What should stay internal? What creates more value outsourced?
We can help you answer these questions. Speak to legal experts to discuss your challenges.
Action plan: Download our Employment Rights Bill tracker to ensure you stay up to date with the latest insights.
