What the Employment Rights Act 2025 Actually Means for Probation

There's been a lot of noise about the Employment Rights Act 2025, and if you've skimmed a few headlines you could be forgiven for thinking the government has invented some brand new "statutory probation period" that you now need a manual for. It hasn't. That proposal was on the table during the bill's passage through Parliament and it got dropped before Royal Assent on 18^th December 2025. So if you've been dreading a new set of rules specifically governing how probation has to work, you can relax on that particular point.

What you can't relax about is the thing that actually did change, because it's arguably a bigger deal than a statutory probation period would have been.

The real change: the qualifying period is shrinking

Right now, an employee generally needs two years' service before they can bring an ordinary unfair dismissal claim. Under the Act, that drops to six months, effective from 1st January 2027. Basically, anyone who started work on or after 2nd July 2026 will already have six months' service by the time the new rule lands, so they get the protection essentially straight away once it kicks in. People who started earlier than that get there sooner than they would have under the old two-year rule too.

Sitting alongside this, the cap on unfair dismissal compensation is being abolished, though the exact commencement date is still being confirmed through regulations. Put those two changes together and you get a genuinely different risk picture: more people eligible to claim, sooner, and potentially uncapped awards if they win.

So does this mean I need to panic about my probation policy?

Not panic. Rethink, yes.

Here's the honest way I'd frame it: your probation period has just become the only real window you have to properly assess someone before the risk profile changes. Under the old two-year rule, if you were slow to notice a problem, you generally had time to correct course. Under the new six-month rule, you don't. That six-month clock is genuinely your assessment window now, not just a formality tacked onto the start of a contract.

A few things I'd actually do about it, rather than just flag as a concern:

Reconsider how long your probation period runs. 

I've seen plenty of contracts with six-month probation periods, and some with longer. If your probation period runs the full six months, you've got almost no runway left to act on anything you notice near the end of it, by the time you've had the conversation, arranged a review, and made a decision, the qualifying period may already have kicked in. Shorter, more front-loaded probation periods, closer to three months, with real structure in that time, give you room to actually act.

Build in proper checkpoints, not just a review at the end. 

A single catch-up in month five is not a probation process, it's a formality. Structured check-ins early, a few weeks in, then again around the two-month mark, mean issues surface while there's still time to do something constructive about them, whether that's support, training, or an honest conversation about fit.

Don't let good management slide because "they're new." 

This sounds obvious but I see it constantly: managers give new starters a longer leash precisely because they're new, and then run out of runway to deal with a pattern that was visible from week two. The instinct is kind. The consequence, under the new rules, is that you end up making a rushed decision at month five instead of a considered one at month two.

The bit I think gets missed

A lot of the commentary on this change treats it purely as a numbers problem, shorter qualifying period, higher exposure, tighten your processes. What doesn't get said enough is that rushing decisions inside a tighter window creates its own risk, particularly where a new starter's performance dip might be connected to something you haven't had a proper conversation about yet; a health condition, a disability, caring responsibilities that only become apparent once they're actually in the job. Pressure to decide fast is exactly the environment where those conversations get skipped and skipping them is its own route into a discrimination claim, separate entirely from unfair dismissal.

What I'd actually tell you to do this year

Don't wait for 1st January 2027 to sort this out. The people you're hiring right now, in the second half of 2026, are the ones this change lands on first. Look at your probation length, your review structure, and honestly, whether your managers actually know how to have a difficult conversation early rather than let it drift. That last part is the one that gets neglected most, and it's the one that actually determines whether any of this works in practice.

If you want a second pair of eyes on your current probation policy before the new rules bite, that's a conversation worth having now rather than in December 2026 when everyone else has had the same idea at once.