22.04.2025

When the Employment Rights Bill completes its passage through Parliament, the two-year qualifying period which currently applies in relation to unfair dismissal will be removed and a new “light touch” process will apply if employers wish to dismiss employees during the “initial period”. The Government plans to consult on exactly what this light touch process will look like, as well as on the appropriate compensation for such dismissals. We understand the Government favours a nine-month initial period, but the exact length is yet to be finalised.

While we welcome the fact that the Government has stated these changes to unfair dismissal law will not come into effect before Autumn 2026 – as this indicates that the Government has listened to Make UK’s concerns about taking time to get the detail right and avoiding unintended consequences – HR should start preparing now for the changes that lie ahead.

As a first step, we suggest revisiting the training and guidance you provide to your managers about recruitment, and particularly about management of probationary periods. It is clear that whatever the statutory “light touch” process looks like, effective management of probationary periods will become critical once the planned changes to the law take effect.  Are you satisfied that your managers have been sufficiently trained to properly manage the probationary process? If not, we recommend that you take active steps to fill any gaps in their knowledge now – speak with your Make UK adviser to find out more about how we can help. Moving forward, it is vital that your managers understand the importance of properly managing any performance or conduct issues at an early stage of the employment relationship and that they feel confident doing this.

Now is also a good to time to review your recruitment procedures as, whatever the outcome of the Government’s consultations, greater due diligence will be needed to ensure new hires are well-suited to your organisation. As well as ensuring that your performance management processes support capability dismissals from day one of employment, you should keep in mind that a separate probationary policy may be needed in due course.

How we can help

As your trusted partner, Make UK can support you with provision of line manager training, as well as HR policy reviews. Make UK consultants are also available to help support you in any projects you undertake in preparation for the changes outlined above (speak with your adviser for further details).

Make UK's Policy Team has been engaging closely with Government, trade unions and other representatives, discussing the detail of the Government's Plan to Make Work Pay to ensure that its proposals benefit both manufacturing employers and their workers. We will continue to represent the views of Make UK members to Government, sharing member insights, suggestions, and concerns via meetings, roundtables, and during the upcoming consultations.

Make UK subscribers can also access guidance on a wide range of employment law topics, including template policies and drafting guidance, in the HR & Legal Resources section of our website.

If you are not a Make UK subscriber, email [email protected] for further information.