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No employer wants to have to dismiss an employee. Decisions like this are never easy, but for several reasons they are often inevitable. And when the worst does come to pass, it's important to know how to dismiss employees in a fair, legal and compliant way.
Short service dismissal is one of the options on the table. If used correctly, it can remove some of the hurdles a standard dismissal requires. But it's important to be aware when short service dismissal rules do and don't apply - and how they are likely to change over the next few years. Here's everything you need to know about short service dismissal.
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What is short service dismissal?
What are the upcoming changes to short service dismissal?
What is a good process for dismissal?
Short term dismissal letter example
What is short service dismissal?
Short service dismissal applies to any employees who are dismissed before they've reached two years of continuous service.
In this timeframe, the employee doesn't have the full rights to make an unfair dismissal claim. This means you can typically speed up the usual dismissal process and forego any redundancy payments. However, this will depend on your company's usual disciplinary procedure and the details in the employee's contract.
Even so, you need to ensure you follow a sound procedure. Failure to do so may put you at risk of an ‘automatically unfair dismissal' claim. It is important to be aware of this, as these protections start as soon as the individual is employed.
What are the upcoming changes to short service dismissal?
The Employment Rights Bill received Royal Assent in December 2025 and became the Employment Rights Act 2025 (ERA).
Under the government’s published timetable in the ERA, the qualifying period for ordinary unfair dismissal reduces from two years to six months from 1 January 2027. The cap on compensatory awards for ordinary unfair dismissal claims is also being removed from the same date.
So, short service dismissal is not disappearing overnight, but the lower-risk window for ordinary unfair dismissal claims is expected to become much shorter. For dismissals with an effective date 1 January 2027, the current two-year qualifying period still applies. From 1 January 2027, employees with six months’ service will be able to claim ordinary unfair dismissal, and employees who already have six months’ service on that date are expected to gain that protection immediately.
It’s also worth remembering that this only relates to ordinary unfair dismissal. Employees already have day-one protection against dismissal for automatically unfair reasons and against unlawful discrimination, and that does not change under the new timetable.
What does that mean in practice? Employers should not wait until the end of 2026 to review their probation, performance management and early-stage dismissal processes. If your current approach relies on issues being picked up late, or treats a six-month probation period as a safe buffer on its own, it’s worth reviewing that now.
What are the legal implications of short service dismissal?
As mentioned above, employees used to need two years' continuous service to bring to bring an ordinary unfair dismissal claim. But that is due to change from 1 January 2027, when the qualifying period is expected to reduce to six months.
That does not mean employers are free to dismiss someone however they like before they reach the relevant service threshold. Short-service employees still have important day-one protections, including protection from discrimination and from dismissal for certain automatically unfair reasons. So before starting any dismissal process, it’s important to check that none of those protections are in play.
1. Family-related
This is related to dismissals regarding maternity or paternity, shared parental leave or adoption leave. If an employee feels they have been dismissed because they've exercised their legal rights to family leave, they can automatically claim unfair dismissal.
2. Refusing to give up certain rights
There are several statutory rights that all employees are entitled to. If they've been dismissed to avoid granting these rights, the employee can automatically claim unfair dismissal. An example of this may be refusing to work over 48 hours a week on average or insisting on being paid the National Minimum Wage.
Read more: What is the National Minimum Wage?
3. Refusal to carry out certain tasks
You cannot dismiss a staff member on short service if they refuse to carry out certain tasks that can put them or others at risk in the workplace. This can involve lifting heavy materials without proper equipment or operating machinery without the correct safety qualifications.
4. Trade union membership
You also cannot dismiss an employee for joining or being affiliated with a trade union. In fact, all employees have the right by UK law to be part of a trade union, leave a trade union or be a member of one or more trade unions.
5. Dismissal because of a protected characteristic
You should also take care not to dismiss any employees because of the following protected characteristics:
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Age
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Disability
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Sex
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Gender reassignment
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Pregnancy and maternity
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Race
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Sexual orientation
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Religion or belief
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Marriage and civil partnership
It's important to consider these exceptions when dismissing a short-serving employee. With discrimination claims, there is no ceiling on the amount of compensation that can be awarded if a claim is successful.
Read more: Employment tribunals: How to avoid them - expert insights
What is a good process for dismissal?
A clear dismissal process is the best way to ensure you treat everybody fairly and avoid falling foul of the law. Here are five steps to include:
1. Identify the reasons for dismissal
First, you should decide on the reasons why the employee is being dismissed. If it's because of wrongdoing or breach of contract, you will need to collect evidence for these actions before taking any decisions. You can suspend the employee, but you must pay them until they're formally dismissed.
Otherwise, you might want to dismiss the employee for financial reasons, or because you no longer need their skills. In this case, you should follow the remaining steps in this section.
2. Draft an initial letter
Next, you should draft an initial letter detailing the reasons for dismissal. If this is for a breach of contract, state the reasons. If it is redundancy for financial reasons, these must also be clearly laid out.
3. Conduct a meeting
Arrange a meeting to discuss the dismissal with the employee. You cannot decide on the dismissal until this meeting is held.
You should also give the employee a reasonable amount of time to prepare, and rearrange the meeting if needed. Employees have a right to trade union representation at these meetings, so it's important you remind them of this right in enough advance of the meeting taking place.
4. Inform the employee of your decision
Once you're able, send your dismissal letter or email to the employee with your decision. You must mention that they can appeal the decision and how they should go about doing so.
5. Give the employee a chance to appeal
Try to have someone who didn't originally dismiss the employee decide the appeal. Also, make sure the employee is aware of their right to be accompanied to meetings.
Short term dismissal letter example
If you're struggling to put together a short term dismissal letter, use our template below. Simply replace the fields in square brackets below and format the letter accordingly.
COMPANY ADDRESS
DATE
EMPLOYEE NAME
EMPLOYEE ADDRESS
Dear [Employee Name]
I am writing to confirm the decision to terminate your employment with [Company Name].
The reasons for this include [Enter reasons].
Your notice period will be [Enter amount of notice]
SELECT AS APPROPRIATE
You are required to work your notice period and your employment will end on
[Enter date].
Or
You will be [placed on garden leave / suspended] for the duration of your notice period. Your employment will end on [Enter date]. During the [garden leave / suspension] you will be required to comply with the terms applicable to [garden leave / suspension] contained in your contract of employment.
Or
The company has exercised its decision to make payment to you in lieu of notice and therefore your employment will terminate with immediate effect on [Enter date].
Final wages
Your final salary will be paid to you in line with the normal payroll process.
You will also receive payment in lieu of any annual leave which you have accrued but not taken during the current annual leave year up to the date of termination.
Return of the company property
You are required to return all company property by [Enter date]. This includes, but is not limited to the following:
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[Enter items of company property]
The company reserves the right to make a deduction from any monies, including wages, payment in lieu of notice or annual leave and bonus or commission payable, an amount to cover the cost of any company property lost or damaged.
[Add closing statement]
Yours sincerely
[Enter name]
[Enter job title]
Stay on the right side of the law
Short service dismissal is certainly easier for employers than the full redundancy process. But there are also complications that could land you in an employment tribunal if you're not thorough. Therefore, it's important to take the time, double-check the rules and ask for help if you're in doubt.
Whatever the reasons for dismissing an employee, it's always safer to check with a legal expert first. For full advice and support on all employment law matters, get in touch with one of our Breathe Partners.
Frequently asked questions
What rights do employees have when dismissed?
Even if an employee has not yet built up enough service for an ordinary unfair dismissal claim, they can still have important legal protections. In particular, employees are protected from day one against dismissal for discriminatory or automatically unfair reasons.
For dismissals with an effective date before 1 January 2027, the qualifying period for ordinary unfair dismissal remains two years. From 1 January 2027, the qualifying period reduces to six months.
That’s why employers should not assume a short-serving employee is risk-free to dismiss. The reason for dismissal, the process followed and the timing all still matter.
For a full breakdown of dismissal rights, visit the UK Government website.
What must employers consider when dismissing short-service employees?
Even without full unfair dismissal rights, short-service employees are still protected by many of the same laws as longer-serving staff.
Before making a decision, make sure you have a clear, fair reason for the dismissal and follow your usual company process. Keep detailed records of meetings and correspondence. Skipping these steps can leave you open to claims, especially if the dismissal could be linked to a protected characteristic or another automatically unfair reason.
Taking the time to get it right not only protects your business but also shows you’re treating people with fairness and respect. If you’re unsure, it’s worth checking with a legal professional before moving forward.
Employment Law
