Extending protection from unfair sackings

This is set to change as the Labour government has committed to introducing key employment rights from day one in employment. This includes protection from dismissal from the first day in job. 

This will end the current arbitrary system that leaves employees waiting up to two years to access basic rights of protection against unfair dismissal. 

What is unfair dismissal? 

Unfair dismissal is a key legal right available to employees who believe they have been dismissed unfairly or unreasonably by their employer. 

You might have been dismissed unfairly if there was no fair reason for the dismissal; the reason was not enough to justify the dismissal; or the employer did not follow a fair procedure 

Who will benefit? 

Approximately 8.5m workers, who currently have less than two years’ service with their employer, will gain protection from unfair dismissal.  

Few of these workers can expect to be dismissed, and lots of employers go through a robust process before a worker is dismissed. However, this gives significant protection to those whose bosses don’t  have proper processes or fair reasons for letting them go. 

Removing the two-year wait will particularly benefit young employees and Black and Minority Ethnic employees who are more likely to have short service. 

Those working in hospitality, care, customer services and “elementary” occupations (this includes jobs such as cleaners and security staff) are also set to be key beneficiaries: 

• Over half of employees aged under 30 (56 per cent) have been with their current employer for less than two years. 
• 42 per cent of BME employees have been with their current employer for less than two years, compared to 28 per cent of white employees. 
• Accommodation and food services (55 per cent) and arts, entertainment and recreation (45 per cent) have the highest percentage of employees who have been employed for less than two years. 
• The occupation groups with the largest percentage of employees who have been with their employer for less than two years are elementary occupations (46 per cent), sales and customer services (42 per cent) and caring, leisure and other service occupations (41 per cent). These are also low-paid occupations. 

Why is this important for workers? 

It’s currently far too easy for an employer to sack a worker who hasn’t qualified for unfair dismissal protections. In many situations employers can lawfully sack a worker, just by giving them their statutory/contractual notice pay and telling them not to come back to work. 

Being dismissed on spurious conduct or capability grounds, without a fair investigation can have devastating consequences for an employee. It can destroy the individual’s morale and confidence and hinder their future employment prospects.   

Extending unfair dismissal protections to employees, from day one of their jobs, will give them much greater job security. They will have an additional legal avenue to challenge unfair, arbitrary sackings.

But even when the qualifying periods are abolished, as the law stands, employers will still have significant leeway to dismiss a worker including for reasons of conduct, capability or redundancy. 

Wider benefits 

Extending unfair dismissal protections to the first day of employment will have a positive effective on labour market mobility.  The two-year qualifying period deters employees from moving from one employer to another due to the loss of employment protection. And workers have been increasingly reticent to change jobs. In 2019, the rate of job mobility was 2.4 per cent, 25 per cent lower than in 2000, according to Resolution Foundation research.  

Removing this existing barrier to labour market mobility will make sure workers can find new jobs, progress and learn new skills and will foster economic change as workers move to new, growing sectors. On average, from 1975 to the present day, individuals who moved jobs enjoyed  typical pay growth 4 percentage points higher than individuals who stayed in the same job. 

The government argues that “the lengthy wait for basic rights means the risk of moving jobs falls too heavily on the worker” and the result is that “people are less inclined to move jobs, posing risks to productivity”. Ministers also believe that making employees less risk-averse about moving jobs will benefit them, as they can increase their salary by moving to better paid jobs, and benefit employers too, who are more likely to get the best candidate for the job. Greater job security may also boost the economy as workers who feel secure are more likely to spend.   

Introducing day one rights to unfair dismissal protections could also lead to better workplace relations. It should encourage employers and workers to engage in difficult conversations and effective performance management, rather than employers seeking to offload staff who need support.  

It’s popular 

For far too long employees haven’t had a legal right to challenge blatantly unfair sackings. 

And it’s what people voted for. TUC polling shows that nearly two in three (64 per cent) of all 2024 election voters support the day one right to protection from unfair dismissal. 

Now it's time for the government to deliver on its promise.