Why is July 2026 a key date for new employees?

Given the forthcoming changes to the qualifying service needed to claim unfair dismissal now is the time to schedule review dates for any employees joining your organisation from July onwards. This is because any employee who joins your business from July 2026 onwards is likely to have completed six months’ service by 1 January 2027. Subject to the Government’s planned employment law reforms coming into force as expected, employees who are still employed on that date will gain the right to claim unfair dismissal.

That’s a huge change.

Until now, employers have generally had two years before an employee gained unfair dismissal rights. While there have always been exceptions (for example, discrimination and whistleblowing claims), employers have had a relatively long period in which to decide whether a new recruit was the right fit for the business.

From January 2027, that window is expected to reduce to just six months.

So What Needs to Change?

Quite simply, employers will need to take probationary periods much more seriously than they have done to date.

Too often, probation periods are written into the contract; a review meeting is pencilled into the diary and then… work gets in the way. Before anyone knows it, six months have passed and the employee has quietly become a permanent member of the team. However all too often concerns regarding their performance have appeared before then.

That approach is unlikely to work under the new rules.

We recommend placing all new employees on a five-month probationary period. This gives managers enough time to assess performance and, where necessary, make decisions before additional employment rights arise.

Managers should also diarise informal probation reviews at two months and again at four months. These meetings don’t need to be overly formal, but they should provide an opportunity to discuss what’s going well, identify any concerns and make sure expectations are clear.

What If There Are Concerns?

The key is to act early.

If concerns are identified at the two-month review, don’t wait until the end of probation hoping things will improve.

Instead:

• Set out the concerns clearly in writing.
• Agree realistic objectives for improvement.
• Explain what support or training will be provided.
• Arrange monthly review meetings to monitor progress.

Taking these steps gives employees a fair opportunity to improve while giving the business enough time to make informed decisions if they don’t.

And If Things Still Don’t Improve?

If the required improvements haven’t been made, employers should seriously consider bringing employment to an end during the probationary period. This means giving notice to the employee and paying their contractual notice entitlement together with any accrued but untaken holiday pay.

Although no employer enjoys dismissing a new recruit, it is far easier to address performance concerns during probation than after unfair dismissal rights have been acquired.

So What Happens If an Employee Goes Past 1 January and Still Has Performance Issues?

Once an employee has acquired unfair dismissal rights, you can no longer simply rely on the probationary period to bring employment to an end. Instead, you will usually need to follow a formal performance management procedure, giving the employee a series of written warnings and a fair opportunity to improve before dismissal is considered. We’ll be looking at what a fair performance management process involves in our next briefing.

In the meantime, if you have concerns about the performance of employees with either short or long service, we can advise you. Please email help@yourhrpartner.co.uk before taking action and we’ll guide you through the options available.

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This post was written by SKHR