Employment law is changing quickly, and several of the most significant reforms will affect how employers recruit, manage, investigate and retain staff. For business clients, the message is simple: the safest time to prepare is now, before the first claim, access request or investigation arrives.
The two-year unfair dismissal period is ending
From 1 January 2027, the qualifying period for ordinary unfair dismissal will reduce from two years to six months. The existing cap on compensatory awards is also due to be removed, increasing the potential risk for employers. Government guidance confirms that employees with six months’ service will gain unfair dismissal protection when the new rules take effect.
This means probation, onboarding and early performance management can no longer be treated as informal or low-risk. Employers should review now how they assess new starters, record concerns, provide feedback and make decisions before the six-month point.
Practical steps to take now:
- Review probation periods and make sure they work with the new six-month threshold.
- Schedule meaningful probation reviews rather than leaving decisions until the end.
- Train managers to document concerns, support offered and improvement targets.
- Check offer letters, contracts and probation clauses.
- Ensure dismissals close to the six-month point are well documented with the reason for dismissal.
Third Party Harassment
Third-party harassment is likely to become a major risk area for employers.
Customer-facing businesses, care providers, hospitality operators, retailers, professional services firms and employers with public-facing teams should all be reviewing their exposure.
The key issue is no longer whether the employer made the comment or behaved badly. The question is whether the employer took adequate steps to protect staff from harassment by customers, clients, service users, contractors or visitors.
A ten-point audit should cover:
- Consider customer-facing risk areas, train staff how to respond.
- Consider any previous complaints or informal reports.
- Establish clear reporting routes for staff.
- Manager escalation procedures.
- Make clear your zero tolerance in all contract terms with customers or clients.
- Erect signage, setting out behaviour standards or acceptable conduct policies.
- Provide training for front-line employees.
- Provide support for staff after incidents.
- Keep detailed records of incidents, steps taken and how the issue was resolved.
- Mak clear and record the action taken against repeat offenders.
Trade union access rights for workers
Government guidance confirms that measures are being taken to facilitate trade unions being more easily introduced as part of the wider employment rights reforms, with changes to recognition and industrial relations rules already underway.
For employers, one of the most important practical issues will be access. A union may be able to seek access to a workforce even where it does not already have members within the organisation. Employers will also need to understand their duties around informing employees of their right to join a union.
This is not just an industrial relations issue for large unionised employers. It matters for non-unionised businesses too. Employers should prepare by:
- Deciding who will handle any union access request.
- Provide training to senior managers to not respond informally or emotionally.
- Review and document internal communications about union membership.
- Understanding the difference between lawful communication and unlawful detriment.
- Planning how to engage with access requests without escalating conflict.
Changes to unfair dismissal time scale
The claim time limit for unfair dismissal is due to increase from three months to six months, and the wider reform programme includes the launch of the Fair Work Agency, a new enforcement body intended to uphold workers’ rights and support compliance.
That has immediate consequences for evidence and record-keeping. Notes, emails and manager records that might previously have been discarded after four months may now be needed for longer. Employers should assume that decisions will be scrutinised well after the event.
Businesses should review:
- Minutes of meetings should be kept in accordance with the employers privacy notice for probation, grievance, disciplinary and performance issues.
- Whether managers keep proper records of informal conversations.
- How HR files are stored and accessed.
- Whether holiday pay, working time and wage records are complete.
- Whether the business could respond confidently to a regulator, not just a tribunal claim.
Final thought
These changes are not theoretical. They affect everyday decisions: who to hire, how to manage probation, how to respond to grievances, how to protect staff from customers, how to deal with unions and how long to keep records.
Employers who wait until January 2027 may find they are already too late. The practical risk point starts now, accordingly we recommend that you review your staff handbook policies and procedures as soon as possible.
For a free review to update your employee handbook contact June Salmon – June.Salmon@spiresolicitors.co.uk.
