The six month unfair dismissal window: why employers need to act earlier

From 1 January 2027, the qualifying period for ordinary unfair dismissal claims will reduce from two years to six months. This fundamentally changes the risk profile for employers and significantly shortens the period available to assess whether a new hire is the right fit for the business. 

Review performance early

The practical message for employers is straightforward: do not wait until the end of a lengthy probation period to assess performance, conduct or suitability. Managers should conduct regular reviews throughout the first few months of employment and address concerns as soon as they arise.

Where an employee is unlikely to meet the required standard, employers should ensure that decisions regarding continued employment are made well before the six month service threshold is reached.

Remember the impact of statutory notice

When managing employees approaching six months' service, employers should not assume that terminating employment immediately, including by making a payment in lieu of notice (PILON), will necessarily prevent the employee from acquiring unfair dismissal rights.

This is because, when calculating whether an employee has the qualifying service required to bring an unfair dismissal claim, tribunals can take into account the employee's statutory minimum notice entitlement. For employees with at least one month's service, this will generally be one week. As a result, an employee dismissed a few days before reaching six months' service may still acquire sufficient qualifying service to pursue an unfair dismissal claim once statutory notice is added to their period of employment.

Employers should therefore avoid treating the six month anniversary as the point at which action must be taken. Instead, any concerns regarding an employee's suitability, performance or conduct should be identified and addressed well in advance of that date, allowing sufficient time for reviews, discussions and decision-making.

For this reason, employers may wish to consider adopting probationary periods of no more than five months. This provides a practical buffer to assess performance, complete any necessary management process and, where appropriate, terminate employment before unfair dismissal protection is likely to arise.

Six months is not a safe harbour

The reduction in the qualifying period should not be viewed as creating a six-month ‘risk-free’ period for dismissals. Many unfair dismissal claims can be brought without any qualifying service at all.

For example, where an unfair dismissal claim is based on discrimination, or in response to whistleblowing or the employee asserting a statutory right, there is no requirement for the employee to have a minimum period of qualifying service.  

Some examples of how this is increasingly coming into play: 

Disability, neurodiversity and hidden risks

Apparent performance concerns may be linked to mental health conditions such as ADHD, autism, anxiety disorders, depression, etc which can, depending on their severity and impact, amount to a disability under the Equality Act 2010. Terminating an employee for performance issues where a mental health issue has not been accommodated through reasonable adjustments could therefore lead to a successful unfair dismissal claim despite the employee not having six months' service.     

The growing whistleblowing risk

Employers should also recognise the increasing role that AI tools are playing in workplace disputes. Employees who use AI to draft grievances, complaints or workplace concerns may inadvertently include allegations that amount to a protected disclosure under whistleblowing legislation, even where they had no intention of raising a whistleblowing complaint.

For example, a grievance initially intended to challenge management decisions or performance feedback will often be expanded by AI to include allegations concerning legal non-compliance, regulatory breaches, health and safety failings, discrimination, financial misconduct or other matters capable of attracting whistleblower protection. 

This creates a significant risk because whistleblowing dismissal claims do not require any minimum qualifying service. Once an employee has made a protected disclosure, any subsequent dismissal may be scrutinised to determine whether the disclosure materially influenced the decision to terminate employment. 

The importance of evidencing the real reason for dismissal

For the reasons cited above, employers should never disregard process entirely, even where an employee has very short service. If a dismissal is challenged, the employer will need to demonstrate the genuine reason for the decision.

Where performance concerns are the catalyst for dismissal, employers should ensure those concerns are documented, discussed with the employee and supported by contemporaneous evidence. The objective is not necessarily to follow the same extensive process that applies to an employee with 6 months' service, but instead to create a clear audit trail showing that poor performance, conduct or another legitimate business reason was the primary reason for termination.

Without such evidence, employers may find themselves defending allegations that the real reason for dismissal was discriminatory, or in retaliation of the employee asserting a statutory right or linked to whistleblowing.  Or another reason that does not require the six months qualifying service to claim unfair dismissal.

Manager training

Many unfair dismissal risks arise not because policies or processes are missing, but because managers fail to apply them consistently.

Line managers are often responsible for recruitment decisions, managing probation reviews and performance conversations. Yet many have received limited training on managing underperformance, documenting concerns or conducting those difficult conversations.

As unfair dismissal protection moves significantly closer to the start of employment, manager competence will become increasingly important. Managers should also be alert to signs that medical, mental health or neurodiversity-related factors may be contributing to the performance shortfall.  We are supporting a number of employers with line manager training to assist them in this regard. 

Key takeaway

The reduction of the unfair dismissal qualifying period from two years to six months substantially reduces the time available to assess new employees. Employers should bring forward probationary reviews, deal with concerns promptly and make decisions on unsuitable employees before the six month point, allowing for the impact of statutory notice. At the same time, employers must remember that six months is not a legal safe harbour. Day one claims remain available, making it essential that employers retain sufficient evidence to demonstrate the genuine and lawful reason for any dismissal. 

The reduction in the unfair dismissal qualifying period makes early performance management more important than ever; however, employers should focus not only on timing but also on evidencing the reason for dismissal. 

Please contact your usual Crowe UK contact if you’d like to discuss this in more detail.