From 1 January 2027, employees can claim unfair dismissal after six months' service instead of two years, and the cap on compensation is removed. FM employers should shorten and structure probation so decisions are made well before month six, document reviews, and put more effort into assessment before the offer, because a poor hire now becomes protected quickly.
On 1 January 2027 the qualifying period for unfair dismissal falls from two years to six months. The commencement regulations have now been made, so the date is fixed. At the same time, the cap on the compensatory award for unfair dismissal is removed.
For FM and estates employers, this is less about tribunals and more about hiring. When protection starts at six months, the decision about whether someone is right for the role has to be made earlier, and on better evidence.
What changes
- Six months, not two years. The new period applies where the effective date of termination falls on or after 1 January 2027. Statutory minimum notice can push that date into the new year, so a dismissal in late December 2026 may already be caught.
- No cap on compensation. For dismissals with an effective date on or after 1 January 2027, the limit on the compensatory award goes, bringing unfair dismissal into line with discrimination and whistleblowing claims.
- Some things do not change. Claims such as discrimination and whistleblowing already need no qualifying service. What changes is that an ordinary fair-process claim becomes available much sooner.
The government estimates the change protects around 6.3 million more employees.
Why six-month probation no longer works
Many FM employers use a six-month probation period, and many extend it when they are unsure. From 2027 that leaves the decision until the very moment protection begins. A probation extended past six months no longer buys time; the employee has the right to claim regardless of what the contract calls the period.
Better practice is a probation period of three or four months, with a structured review at the halfway point and a clear decision before the end. That gives room to extend for a short, defined period if a fair process is needed, while still deciding before month six.
What good probation looks like in an FM role
- Objectives set in week one. For a Facilities Manager, that might be the compliance position across the portfolio, the state of contractor performance and a first view of the planned maintenance backlog.
- Evidence, not impressions. Statutory inspection records, contractor reviews, helpdesk performance and stakeholder feedback tell you more than a general sense that someone is settling in.
- Written reviews. Short notes of each review, with what was agreed and by when. If a fair process is needed later, these are what it rests on.
- A decision, not a drift. Confirm, extend for a short defined period with clear targets, or end the employment fairly. Do not let probation simply run out.
Our first 100 days plan builder is a useful starting point for setting early objectives in a senior FM or estates role.
The real fix is earlier
The cheapest way to manage the new risk is not to make the wrong appointment in the first place. That means a brief agreed by everyone who will judge the hire, assessment against real situations rather than a CV walk-through, and references that test the specific things the role needs.
It also makes the interim option more attractive for some roles. Where the shape of a role is uncertain, an interim appointment can stabilise the function while the permanent brief is settled.
We explain how we assess senior FM and estates leaders, and what we test before anyone is presented, on our assessment page. If you are planning appointments for 2027, talk to our team. This article is general information, not legal advice.
