Employment Rights Bill 2026 – What Every Director Needs to Know

Directors – Important Employment Law Changes Coming in 2026

I wanted to flag a big shift that’s coming down the line with the Employment Rights Bill, expected to take effect from 2026.

This could be one of the biggest changes to unfair dismissal law in over 40 years, and it’s something every business leader and hiring manager should be aware of.

Here’s the highlights:

1. Day-one protection for unfair dismissal

The Government plans to remove the current two-year qualifying period, meaning employees will have unfair dismissal protection from day one.
Even in probation, you’ll need to show a fair reason and a reasonable process for dismissal.

2. Statutory probation period

They’re proposing a new statutory probation period, likely around 9 months, with “light-touch” dismissal rules during this time.
That said, if someone dismissed in this period successfully brings a claim, there may no longer be a lower cap on compensation — so the risk increases for early dismissals.

3. Fire & rehire clampdown
The Bill will also make it automatically unfair to dismiss an employee who refuses a restricted contract variation they didn’t agree to.
This tightens up the long-debated “fire and rehire” approach and limits employer flexibility around changing terms.

What this means for employers:

• You’ll need to manage performance and document feedback from day one.
• Contracts and probation clauses must be watertight.
• Any contractual changes will require clear employee consent.
• HR & leadership teams should start planning now

At Planning Recruitment, we’re already working with our clients to align hiring and onboarding processes to these proposed changes helping reduce risk and ensure smoother probation management.

We’ve pulled together a 2-page Director Briefing summarising everything you need to know.

If you would like a copy or to chat through what this means for your business, drop me a message, we’re happy to help and our contact number is 023 80 181055

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