The government has abandoned plans for immediate unfair dismissal protection, introducing a six-month qualifying period instead under revised Employment Rights Bill proposals announced on Thursday.
The move represents a retreat from Labour’s manifesto commitment and follows negotiations between business groups and trade unions after the bill stalled between the Commons and Lords.
Employees will now need to complete six months of service before gaining unfair dismissal rights, down from the current two-year threshold but short of the day-one protection originally promised.
The Department for Business and Trade said the revised approach emerged from “constructive conversations” between employer representatives and union leaders. Officials described it as “a workable package” maintaining first-day protections against discrimination whilst introducing the six-month threshold for standard unfair dismissal claims.
The changes hold particular significance for hospitality, where workforce flexibility and probationary periods are standard.
Kate Nicholls, chair of UKHospitality, said: “This is a pragmatic change that addresses one of hospitality businesses key concerns. We made clear representations to the Government that a six-month qualifying period would be much more practical for businesses and maintain job opportunities for young people, and I’m glad they have acted on those concerns.”
She added that the bill would still bring substantial changes and extra costs to hospitality businesses, calling for the government to delay statutory sick pay from day one by six months given increases to wages, business rates and other costs coming in April.
Ministers committed that the six-month period could only be changed through primary legislation, preventing future adjustments through secondary regulation. The government also pledged to remove the compensation cap for successful unfair dismissal claims.