Dismissal during probation is often seen as a straightforward way to part company with a new employee who isn’t working out. But a probation period doesn’t remove an employer’s legal obligations, and changes coming in January 2027 make the timing and handling of a dismissal even more important.
Under the Employment Rights Act 2025, the qualifying period for ordinary unfair dismissal claims will fall from 2 years to 6 months on 1 January 2027. The change won’t abolish probation periods, but it will leave employers with far less time to assess performance and address concerns before an employee gains the usual protection against unfair dismissal.
So, can you dismiss an employee during probation? Should you shorten a 6-month probation period? And what happens if an employee has already been with your business for 6 months when the law changes?
Dismissal during probation: what are the rules?
As of today, employers can dismiss someone during their probation period, provided it complies with the employment contract and applicable employment law. But probation isn’t a period in which an employee has no rights.
Certain dismissals, such as those involving unlawful discrimination or certain automatically unfair reasons, such as whistleblowing can be challenged regardless of length of service.
Employers must also give the correct contractual notice, unless an exception such as gross misconduct justifies dismissal without notice. A failure to give contractual or statutory notice can lead to a wrongful dismissal claim, even where an ordinary unfair dismissal claim isn’t available.
At present, most employees in England and Wales gain full employment rights after 2 years’ continuous service but from 1 January 2027, that qualifying period will decrease to 6 months.
This means after 1 January 2027, if you dismiss an employee with 6 months’ service and fail to provide an adequate reason for their dismissal, they may have the right to bring a claim.
What changes are there to unfair dismissal in January 2027?
The headline change is the reduction in the qualifying period for ordinary unfair dismissal. There are also changes to the right to request written reasons for dismissal and to the compensation that may be awarded by an employment tribunal.
| Issue | Before 1 January 2027 | From 1 January 2027 |
|---|---|---|
| Ordinary unfair dismissal qualifying period | Usually 2 years’ continuous service | 6 months’ continuous service |
| Right to request written reasons for dismissal | Usually after 2 years’ service | Usually after 6 months’ service |
| Compensatory award for ordinary unfair dismissal | Subject to the statutory cap and other applicable limits | Statutory compensatory award cap removed; compensation must still reflect the legal assessment of loss |
| Probation periods | No general statutory requirement to have one | No change: employers can still use probation periods |
The date of dismissal matters, including where dismissal during probation is being considered. The new 6-month qualifying period applies where the effective date of termination is on or after 1 January 2027.
It also covers employees who joined in 2026 and have already accrued 6 months’ service by that date, including where any notice period would take the employee up to, or over 6 months’ service. Lastly, the change also isn’t limited to just new hires.
The changes are introduced by section 25 of the Employment Rights Act 2025, with the commencement and transitional arrangements set out in the Employment Rights Act 2025 (Commencement No. 4 and Transitional and Saving Provisions) Regulations 2026.
Removing the cap on compensatory awards doesn’t mean every successful claimant will receive a large payout. Tribunals will still consider matters such as actual financial loss, mitigation and the rules governing compensation. Nevertheless, it increases the potential exposure in some claims, particularly those involving higher earners.
Will 6 month probation periods become illegal?
No. The Employment Rights Act 2025 doesn’t prescribe a maximum probation period or require employers to introduce one. A business could retain a 3 month, 6 month or longer probation period if it suits the role.
What changes is the relationship between probation and unfair dismissal protection. For dismissal during probation, the length of the contractual probation period does not determine when statutory protection starts. A contractual probation period and the statutory qualifying period are separate things. Extending someone’s probation to 9 months won’t postpone their unfair dismissal rights until month 9. Those rights will ordinarily arise after 6 months’ continuous service.
Nor does passing probation make dismissal impossible. An employer can still dismiss an employee for a potentially fair reason, such as capability or conduct, provided it acts reasonably and follows an appropriate process.
The Government has published guidance on unfair dismissal eligibility, including how the qualifying period is changing.
What the changes do mean in practicality is that many businesses will need to tighten performance management and training processes, together with keeping better documentation.
Stay ahead of the curve
Should employers shorten their probation periods?
For some businesses, a shorter probation period may make sense. A 4 month period, with reviews at regular intervals and a decision before the end date, could leave time to address problems before the employee reaches 6 months’ service. That said, there is no single probation length that will work for every job.
A specialist or senior role may need longer to assess properly. Rather than shortening every probation period, employers should look at how they evaluate new starters, when managers raise concerns and how quickly decisions are made.
One point is easily overlooked when planning dismissal during probation: giving notice can affect the effective date of termination, and statutory rules can affect how service is counted. If an employee is approaching 6 months’ service, it isn’t enough simply to hold a probation review before that anniversary. The notice arrangements and termination date need careful attention. Employers should obtain advice before relying on a dismissal taking effect before the qualifying period is reached.
What happens if an employee reaches 6 months’ service during probation?
Imagine a business recruits a new employee on 1 January 2027, with a 6 month probation period.
By June 2027, the employer has serious concerns about the employee’s performance. They have received several complaints about missed deadlines and mistakes in their work, but these concerns haven’t been formally raised with the employee.
The employer decides to dismiss them before their probation period ends.
Under the new rules, the timing of the dismissal could be particularly important. Although the employee hasn’t yet completed 6 months’ service in June, their contractual notice period could take them beyond that threshold.
If the employee has acquired ordinary unfair dismissal protection by the effective date of termination, the employer could face a claim if it cannot demonstrate a fair reason for dismissal and a reasonable procedure.
This is why employers should address performance concerns as they arise, rather than waiting until the end of probation to decide whether someone is suitable for the role.
How to manage probation and dismissals fairly
A well-run probation process is less about paperwork for its own sake and more about preventing avoidable disagreements. If a manager decides that a new starter hasn’t met expectations, the business should be able to explain what those expectations were, where the employee fell short and what support was offered.
We recommend that employers take the following steps:
- Set expectations. Explain the employee’s responsibilities, performance standards and how their progress will be assessed.
- Schedule reviews. Early and mid-point meetings provide time to identify difficulties and act on them.
- Record concerns. Use specific examples, dates and agreed objectives rather than general statements that someone isn’t a good fit.
- Allow improvement. Consider training, supervision and reasonable adjustments where relevant.
- Decide in good time. Check the contract, notice period, length of service and whether a formal capability or disciplinary procedure is required.
- Confirm in writing. Explain the decision, the termination date, notice arrangements and any applicable appeal process.
Following a fair process is especially important once the employee has 6 months’ service, but it is sensible practice from their first day. It can also help address allegations of discrimination, retaliation or breach of contract.
For smaller businesses that may not have formal probation and performance management processes, it’s essential to establish these together with training people managers.
Acas recommends that dismissal during probation should be a last resort, with employers first considering measures such as additional support, performance management or extending probation where appropriate.
The importance of documenting performance concerns
Our perspective
One of the risks for employers is treating probation as an informal arrangement that doesn’t require much documentation, or not keeping any documentation whatsoever.
While managers may have genuine concerns about an employee’s performance, those concerns can be difficult to rely on as reasonable grounds for dismissal if they haven’t been recorded or discussed with the employee.
If a dismissal is challenged, the employer will need to explain why it made the decision. Having clear records of performance reviews, feedback and support offered can make that considerably easier.
What if an employee is underperforming during probation?
Underperformance is a common reason for failing probation, but it is worth separating an employee who cannot meet the role’s requirements from someone who has not been given adequate training or a reasonable opportunity to improve.
For example, if a new recruit is making repeated errors, the manager should explain the problems, identify the standard required and agree how improvement will be measured. A short written improvement plan can be useful. For further guidance on managing difficult cases, see our sickness and performance management services. If performance remains unsatisfactory, the employer can then consider whether extending probation or moving towards dismissal is appropriate.
Care is needed where performance concerns may be connected to a disability. An employer may have a duty to make reasonable adjustments, and dismissing someone without considering them could create a discrimination risk regardless of their service length.
The problem with 6 month probation periods
Our perspective
For employers currently using 6 month probation periods, the new legislation presents a practical problem. If performance concerns only come to light during the final probation review, the employee may already have acquired unfair dismissal protection by the time the business is ready to make a decision.
Employers may therefore want to consider shorter probation periods or more frequent performance reviews, rather than relying on a single assessment at the end.
Can you extend probation beyond 6 months?
Yes. Whether an extension is permitted will depend on the terms of the employment contract and how the employer manages the change. An extension may be justified where further time is genuinely needed to assess performance or where absence has prevented a fair assessment.
Any extension should have a clear duration, agreed objectives and review dates. It should not be used to avoid statutory employment rights.
It’s important to distinguish employment rights from an emplyoee’s probation period. From January 2027, an employee who has 6 months’ continuous service will ordinarily have unfair dismissal protection even if they are still described as being on probation.
Can extending probation help employers avoid unfair dismissal claims?
Let’s look at an example.
A business employs a sales executive on a 6 month probation period. Towards the end of their probation, the employee is consistently missing sales targets, but their manager believes they might improve with additional support.
The employer decides to extend probation by another 3 months.
Although the extension may be entirely reasonable from a performance management perspective, it won’t delay the employee’s statutory unfair dismissal rights.
Under the new rules, the employee will ordinarily become eligible to claim unfair dismissal once they reach 6 months’ continuous service, regardless of whether they have passed probation.
If the employer subsequently dismisses the employee, they will need to consider their obligations under unfair dismissal law, as well as the terms of the employment contract.
If the employer hasn’t documented its concerns or given the employee a reasonable opportunity to address them, it could give rise to an unfair dismissal claim.
What dismissal risks exist before 6 months’ service?
The same day 1 dismissal risks will apply both before and after 1 January 2027. These are circumstances where an employee doesn’t qualify to bring an ordinary unfair dismissal claim, but dismissal during probation may still give rise to legal action, including an employment tribunal claim.
Particular risks include:
- Discrimination: dismissal because of a protected characteristic, or failures relating to reasonable adjustments for a disabled employee.
- Automatically unfair dismissal: certain protected reasons, including whistleblowing or asserting particular statutory rights, do not require the ordinary qualifying period.
- Wrongful dismissal: a failure to honour contractual notice or other relevant contractual obligations.
- Unpaid entitlements: disputes about final pay, accrued holiday or other sums owed when employment ends.
Managers should therefore avoid thinking of probation as a time when employees can simply be dismissed without a reason. That approach can be both misleading and expensive.
What should employers do before January 2027?
Businesses don’t need to, and should not abandon probation periods, but they should check that existing arrangements are fit for purpose. In particular, review:
- probation clauses in employment contracts, including extension and notice provisions
- the timing and consistency of probation reviews across teams
- performance management and remedial training processes
- the training managers receive on capability, conduct and fair dismissal procedures
- how concerns, support offered and decisions are documented
- employees hired during 2026 who may already have 6 months’ service when the new rules begin
It’s also worth reviewing how your business handles employee dismissals and other employment law matters more generally. A probation process shouldn’t operate in isolation from disciplinary, capability and equality policies.
In brief: FAQs
Can you dismiss an employee during probation?
Yes, you can dismiss an employee during their probation period, provided you comply with their employment contract and relevant employment laws.
The change from 1 January 2027 means employees will gain full employment rights after 6 months’ service regardless of whether they are in a probation period. This protection extends to employees dismissed before 6 months’ service whose contractual notice periods would take them to the 6 month mark.
Regardless of the changes, employers can still face claims for discrimination, automatically unfair dismissal or breach of contract, irrespective of how long someone has worked for them.
Can an employer still extend a probation period after the change?
Yes, employers can extend an employee’s probation period, provided their contract allows for an extension or the employee agrees to one. However, extending probation doesn’t delay the point at which an employee becomes eligible to claim unfair dismissal. From 1 January 2027, employees will ordinarily acquire this protection after 6 months’ continuous service, even if they are still on probation.
Do employers need to reduce probation periods?
No, however it may be a practical temporary or permanent step for some businesses to take. The Employment Rights Act 2025 doesn’t prescribe how long probation should last. However, with unfair dismissal protection becoming available after 6 months’ service from January 2027, businesses may wish to review their existing arrangements to ensure they have enough time to assess new employees before that protection takes effect.
Similarly, businesses who do not have established performance and capability management processes, may wish to adopt shorter probation periods until these processes are developed.
How we can help
The reduction in the unfair dismissal qualifying period makes early, consistent performance management more important, particularly when considering dismissal during probation. If your business is reviewing probation clauses, considering dismissing an employee or dealing with an underperformance issue, it’s worth getting the process right before taking action.
Our employment law solicitors for employers can advise on probation policies, contracts, capability procedures and dismissals, including the changes taking effect in January 2027. For a wider explanation of the reforms, read our guide to employment law changes in 2026.
Call us on 0203 007 5500 or contact our employment team to discuss your business’s circumstances.
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