10/02/2025

The Employment Rights Bill has been making its way through the parliamentary process and has received several amendments since its introduction in October 2024. So far, the Bill has reached its Report Stage, following which it will move to the third reading.

This article focuses on some of the changes to the Employment Rights Bill which are coming into force. We will keep you updated as more information becomes available.

  • The increase of time limits on all employment claims from three months to six months.

The government feels that three months is not always sufficient time for a claimant to file a claim. Therefore, the limitation periods are being increased. This will provide more time for potential settlement or resolution of disputes before a claim is needed but, in turn, it will increase the period of uncertainty for employers who, for a period of six months, will not know whether a person plans to file a claim against them.

  • Further obligations relating to those employing qualifying workers with the right to guaranteed hours.

Employers will be required to take ‘reasonable steps’ to ensure workers are given specific information about their rights to guaranteed hours during the first two weeks of work and at the end of every reference period, which we understand will be 12 weeks.

A qualifying worker will be anyone who meets a criterion during the reference period including:

  • they worked under a zero-hour contract arrangement or low hour contract;
  • they worked a number of hours during the reference period;
  • their hours exceeded the minimum number under their low hour terms, and
  • they were not an excluded worker such as agency staff.

It appears the right to guaranteed hours will create a significant administrative burden on employers, which may, of course, be the government’s tactic to deter employers from using zero-hour terms.

The specific details, minimums and maximums have not been set out yet, so there is still a chance this won’t completely ruin seasonal work, but we will clarify this when the information is available.

  • Repeal of qualifying period for unfair dismissal – No more two-year service rule

The government wants to provide employees with more security at work from day one, rather than requiring them to work for two years before they can claim unfair dismissal. The initial comments of the repeal were that there would be a probation period that still allowed employment to be terminated with notice. We now understand there will be a ‘light-touch’ dismissal procedure covering an initial period of employment.

So far, the right to claim unfair dismissal will only apply to employees and not to workers.

Regulations will be introduced which will include the finer details, but a fair dismissal will be possible if it takes place during the initial period of employment where the effective date of termination is within three months of the last day of the initial period, and it is due to capability, conduct, statutory restriction or SOSR (‘some other substantial reason’).

The right not to be unfairly dismissed due to redundancy, is not included in the new provisions. This means new employees will be protected from unfair redundancy selection from day one. However, the right to a redundancy payment will remain at two years’ service. These changes also change the right to written reasons for dismissal which will apply once the initial period of employment has ended, although in practice employers will give a reason for termination (however brief).

There will be regulations that provide the rules for a modified procedure to be followed by employers where they want to dismiss an employee during the initial period ‘probation’. At the moment it is understood that the procedure could be a meeting held with the employee (who can be accompanied by a union representative or colleague). Employers will need to be more proactive during this period and to have a paper trail of discussions to ensure they can show the person is ‘not right’ for the job.

Compensation for unfair dismissal during the initial period will be capped.

Employers should also be aware that these changes affect employees from day one of employment, except for automatically unfair dismissals which won’t require the person to have started work. We would suggest employers refrain from providing contracts to new recruits until their first day. Otherwise, those who have signed their contract for any period before their actual start date, they can claim unfair dismissal if they believe the termination or withdrawal of the job is due to whistleblowing or trade union reasons.

Need advice on employment rights?

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