Probationary periods: review now as unfair dismissal protection moves closer

From 1 January 2027, one of the most significant changes introduced by the Employment Rights Act 2025 will take effect: the qualifying period for ordinary unfair dismissal claims will reduce from two years’ continuous service to six months.

This means new starters will gain unfair dismissal protection much sooner than before; and probationary periods are set to become even more important as a way to assess suitability, address concerns early and make informed decisions about continued employment.

What is a probationary period?

The Employment Rights Act 1996 contains a limited definition of a probationary period, describing it as a temporary period specified in the contract which begins at the start of employment and is intended to allow the employer to assess the worker’s suitability for the role.

Beyond this, there is no statutory framework governing probationary periods. Their operation is therefore largely managed by the terms of the employment contract.

Interestingly, the Government’s original proposals for a statutory probationary period (referred to in earlier versions of the Employment Rights Bill as an “initial period of employment”) did not make it into the final legislation. This means that employers have flexibility to determine arrangements that are appropriate for their business and workforce.

How long should they be?

The appropriate duration of a probationary period will vary depending on the nature of the role and the time required to make a meaningful assessment of performance and suitability.

For more junior positions, a relatively short period may be sufficient. However, employers recruiting into specialist, managerial or senior leadership roles may need several months before they can properly evaluate whether expectations are being met.

Factors that may influence the length of a probationary period could include:

• the complexity of the role;
• the level of seniority;
• the skills and experience required;
• the extent of training involved; and
• the time against which performance can be measured.

Why probation matters more than ever

With the unfair dismissal qualifying period reducing to six months, the approach to probationary periods may need to change.

Employers will need to ensure that:

• probationary periods are clearly documented in contracts of employment;
• managers understand how probationary reviews should be conducted;
• concerns are identified and addressed promptly;
• appropriate records are kept and maintained; and
• decisions regarding continuation or termination of employment are made before employees acquire additional statutory protection.

A common pitfall is allowing probationary periods to drift without formal review. If an employee reaches six months’ service without concerns being raised or processes being followed, the employer may find itself facing a more complex dismissal process than anticipated.

Practical steps for employers

With January 2027 fast approaching, employers should start reviewing their recruitment and onboarding processes to ensure they remain fit for purpose.

In particular, employers should consider:

• reviewing policies and probation clauses in employment contracts;
• ensuring the length of probationary periods are appropriate;
• implementing and diarising structured review meetings throughout probation;
• training managers on documenting concerns and setting objectives; and
• diarising probation end dates to avoid employees passing the six-month threshold without a formal decision.

The reduction in the unfair dismissal qualifying period represents increases in the importance of effective performance management from day one of employment.

While probationary periods do not remove legal risk altogether, a well-drafted probation clause or policy combined with a structured review process can provide employers with a valuable opportunity to assess suitability and address concerns before employees acquire the protection from unfair dismissal.

Probationary periods should no longer be viewed as a routine contractual provision. They are likely to become one of the most important tools for managing recruitment risk following the upcoming changes in employment law.

If you would like assistance on drafting your probationary period clauses or policies, please get in touch with one of the employment team.