Unfair Dismissal Changes – The Clock Is Ticking

The unfair dismissal regime is changing with effect from 1 January 2027, when the cap on compensation will be removed, and the qualifying service period will reduce from two years to six months. 

Many employers have begun to review their existing staffing needs in good time, so that any dismissals or redundancies that may be necessary can be effected well before the deadline. One important point not tooverlook, however, is the interaction between the 1 January deadline and an employee’s contractual and statutory notice periods. Contractual notice periods are fairly straightforward, as (in most cases) an employer can make a payment in lieu so that employment comes to an end on the payment date – giving the employer control over the clock.