Changes introduced by the Employment Rights Act 2025 continue to have important implications for employers. While the Act does not make specific provisions relating to probation periods, the reduction in the length of qualifying service to bring an unfair dismissal claim from 2 years down to 6 months from 1 January 2027, places an increased importance on their use.
Going forward, it will be advisable for employers to ensure that probationary periods are handled properly with a process that is clear and managed proactively from the outset.
Managers are going to be key in this process and providing them with training to deal with performance issues or, at the very least, clearly setting out what they need to do during those early months, will be worthwhile. They should engage with new employees, setting performance expectations early on, and aim to hold regular review meetings to discuss and track their progress. Accurate job descriptions setting out key requirements of the role will also be useful to help measure performance against pre-defined criteria. Any concerns about performance or conduct should be raised and recorded promptly as this will help your position should the need for a termination arise.
Many employers are considering shortening the length of longer probationary periods. If you currently have employees with contractual probationary periods of six or more months, you may wish to consider reducing them. This will not be appropriate for all roles, and some will genuinely require a longer probationary period, but giving due thought to this when issuing contracts will be important, instead of having a ‘one size fits all’ approach. A probationary period of either three or four months, with a right for the employer to extend once (ideally by no more than one additional month) should allow sufficient time to make a decision regarding the employee’s ongoing engagement before the unfair dismissal protection applies at the six-month mark.
It is also worthwhile checking that your probation clause is well-drafted. Clauses should set out things such as the length of the period, the performance and behavioural expectations, the employer’s right to extend the period where necessary, and confirmation of how it will be deemed as being passed.
After the 6 month period has passed, employers will of course still be able to dismiss employees, but will not have the potential freedom to follow a shorter-form process which can be the case with some (but not all) cases where the employee’s length of service is under the unfair dismissal threshold.
Regular review of your contracts and key terms is increasingly essential in this evolving legal landscape. By keeping contracts under regular scrutiny and updating them as the law changes, employers can ensure both compliance and protection for their business.
If you would like advice on reviewing your contracts in preparation for these changes, or managing the probation process more generally, please get in touch with Jake King at [email protected] or please contact our Employment Team.
