Employees with a minimum of one year’s service have the right to claim unfair dismissal. Once an employee has passed the one year milestone, the employer has to show that reason for a dismissal is fair and has to follow a fair procedure.
The government is considering a change to the qualifying period for unfair dismissal claims – to two years. This was first revealed by Lord Young, then enterprise adviser to the government, in an interview with the BBC during the launch of the government’s “Backing Small Business” initiative in November 2010. It is expected that formal recommendations will appear early this year (2011).
This means, at first sight, that employees in their first two years working with an employer would have no protection against being dismissed at will (provided that the correct notice was given) and employers should therefore face fewer unfair dismissal claims.
However, employees are already protected against discriminatory dismissals and where dismissal is automatically unfair (for example, where they are sacked because of whistleblowing, for pregnancy and maternity reasons, trade union involvement, Working Time Regulations claims etc). Employees need no qualifying period for these claims and this would not change. Such claims could increase where the opportunity to claim basic unfair dismissal disappears.
This is not entirely new territory. There was a two year qualifying period for unfair dismissal for several years until 1999, when it was changed to one year. The concept has already been tested by the courts (for discriminatory effect). In 1999 in the case of R v Secretary of State for Employment ex p Seymour-Smith, the House of Lords decided that the two year qualifying period was potentially discriminatory against women, because women were less likely than men to accrue two years’ continuous service. However, it held that there was potential justification (on social policy grounds) for a two year qualifying period. This may discourage further challenge.
