In a significant policy reversal, the Labour government has abandoned its manifesto commitment to grant all workers protection from unfair dismissal from their first day in a new job.
The Policy Shift
The Department for Business and Trade (DBT) announced on Thursday 27 November 2025 that the contentious right will now come into force after an employee has completed six months of service. This marks a major departure from the party's pre-election promise to entirely abolish the current two-year qualifying period, which allows employers to dismiss staff without providing a reason.
The U-turn was confirmed by Peter Kyle, the minister involved, following sustained pressure from industry leaders and political resistance in the House of Lords. The original day-one protection was a cornerstone of the government's flagship Employment Rights Bill.
Reasons Behind the Climbdown
The government decided to amend its plans amid concerns that the legislative package would be continually blocked by the Lords, jeopardising the entire bill. This bill also includes other major employment law changes, such as outlawing some zero-hours contracts and banning 'fire and rehire' practices.
Business groups, particularly the coalition known as the 'B5', had mounted an aggressive campaign against the day-one rights. They argued that removing the two-year provision would stifle hiring and burden companies with the threat of immediate legal challenges.
Reaction and Next Steps
The DBT stated the decision followed a series of constructive meetings with both union and business representatives. The involved business groups welcomed the compromise, stating it gives businesses the confidence to hire and support employment, at the same time as protecting workers.
However, they noted that concerns remain over other aspects of the bill, including rules on guaranteed hours contracts, seasonal workers, and thresholds for industrial action. The revised proposal aims to unblock the parliamentary logjam and allow the rest of the employment measures to proceed.
