The Government has confirmed plans to reduce the qualifying period for unfair dismissal claims from two years to six months, with the new rules expected to take effect from 1 January 2027. It’s worth noting that this is not yet enacted legislation and may still be subject to change, but employers are already preparing for the shift.
While the intention is to provide employees with earlier protection, the change will also have a significant impact on employers, particularly when it comes to hiring decisions, probation management, and early performance issues. But there are options: for many businesses, temporary recruitment and temporary-to-permanent recruitment structures will become even more valuable tools for managing hiring risk.
At Pure Staff, we already support hundreds of clients each year with temp-to-perm recruitment, including 247 successful temp-to-perms this year alone, and we predict this legislative change will make that model even more attractive to end hirers.
What’s actually changing?
Under the current rules, employees need two years’ continuous service before gaining the right to claim ordinary unfair dismissal (day one rights, such as discrimination protection, still apply). From 2027, that qualifying period will drop to six months. Current proposals also indicate that the six-month period will apply retrospectively. This means that any employee who has six months’ service by 1 January 2027 (for example, someone who started around 1 July 2026) would gain unfair dismissal protection immediately when the new rules begin.
That means someone who has been employed for six months will have access to the full unfair dismissal regime, regardless of whether they are still in probation. This is a significant shift, and many employers are already reviewing their onboarding, performance management and probation processes to adapt.
Why does this matter for hiring decisions?
Once a worker becomes a direct employee of your business, the “length of service clock” starts ticking. Under the new rules, that means you have a much shorter window to:
- assess performance
- address early concerns
- identify whether someone is the right long-term fit
- document any issues correctly
- Many businesses who previously felt comfortable taking on new staff directly due to the current two-year ruling may now feel they have less room for error.
This is where temporary recruitment becomes a powerful risk-management tool
A key point that many employers are not yet aware of: time spent as a temp through an agency does not count towards continuous employment with the end hirer. Temporary workers supplied via an agency are classed as “limb (b) workers”- a category that carries important rights such as holiday pay and equal treatment after 12 weeks, but does not create continuity of employment for unfair dismissal purposes. In other words:
- A temporary worker supplied via Pure Staff is not your employee.
- Their qualifying period for unfair dismissal does not start during the temp phase.
- The six-month clock only begins if and when you choose to employ them directly.
This gives employers far more flexibility and confidence in the early stages of the hire. It also means a structured temp-to-perm approach can create a safer and more controlled pathway into permanent employment, especially under the new legislation.
What this looks like in practice
Here’s a simple example that clients find helpful:
Before the rule change (2-year qualifying period) – Many employers felt there was already a lengthy period in which they could manage performance risk internally. As a result, some did not see the value in temp-to-perm models outside of flexibility or short-term cover.
After the rule change (6-month qualifying period) – An employer who hires someone directly now has only six months before they gain unfair dismissal rights.
But with a temp-to-perm model, you can do the following:
Step 1 – Temp period (e.g. 3 to 6 months)
- Worker is employed by Pure Staff, not by you
- Zero unfair dismissal risk for your business
- Full performance visibility
- No long term commitment
Step 2 – Permanent offer after successful temp period
- The 6 month qualifying period only starts once here
- You enter this phase having already seen their attendance, performance, attitude and reliability
- Most clients choose a further probation period layered on top for security and structure
Overall benefit: You may effectively get 9–12 months of assessment time before you face the legal risk that now attaches after just six months of direct employment.
Why this matters more for SMEs
Smaller employers often do not have:
- Formal HR departments
- Detailed performance management frameworks
- Legal support on hand
- Structured probation review processes
For these businesses, the shortened qualifying period will feel more “high stakes”, and many will naturally look for ways to reduce risk when hiring. A temp or temp-to-perm model provides that buffer.
How Pure Staff can support you
With over 15 years specialising in temporary, contract, and temp-to-perm recruitment, and over 240 temp-to-perm conversions this year alone, we are well placed to help clients adjust to the new landscape.
Our service gives you:
- A risk-free assessment window before any employment liabilities start
- Access to fully screened, compliant workers
- Support with onboarding and worker engagement
- A structured pathway into permanent employment when you decide the time is right
In short, we help you make better, safer hiring decisions and it’s not as expensive as you think.
Final thought: a challenge becomes an opportunity
The upcoming employment law changes may feel daunting for many businesses, particularly those used to relying on a two year assessment window. But with the right approach, this change also presents an opportunity:
✔ to improve hiring quality
✔ to protect your business from unnecessary risk
✔ to create a more efficient route into long term employment
Temporary and temp-to-perm recruitment is no longer just about flexibility, it is fast becoming a strategic shield in a much tighter employment law environment.
