Key takeaways

The Employment Rights Bill is currently in “ping-pong” between the two Houses of Parliament, most notably in relation to unfair dismissal rights.

Last week (28 October 2025), the House of Lords voted against the government on this issue, as well as a couple of other matters — see our brief alert here.

The House of Commons has rejected all of the Lords’ amendments, in line with government policy, although with some minor compromises on certain peripheral issues. The latest position on the contested issues is as follows:

• Unfair dismissal rights: the House of Commons has again insisted that this should become a day-one right. As a very minor compromise, the government has agreed to a limited, statutory duty to consult on certain issues related to statutory probationary periods. We think this compromise is largely symbolic, given that the government had already announced long ago that it would be consulting on the rules governing these periods. (See below for more detail.)
• Guaranteed hours offers (GHOs): this will remain as an obligation on the employer to make the GHO; there will be no duty to give advance notice of the right to receive a GHO nor, importantly, an ability for a worker to decline to receive the GHO or future GHOs.
• Trade union matters: the House of Commons has insisted on removing both the opt-in requirement for contributions to a union’s political fund and the 50% turnout threshold for a valid industrial action ballot. The only compromise is a minor obligation on the government to consider the potential effect on turnout caused by any future changes to methods of voting.
• Heritage railways: it seems strange that such a niche issue has crept into the debate on this key piece of legislation! The Commons has rejected the Lords suggestions but has proposed an alternative one; although it still boils down to an agreement to require certain government bodies to produce guidance on children working for a heritage railway or tramway.

The Bill will now return to the House of Lords for further discussion.

 In more detail

The removal of the qualifying period for unfair dismissal isn’t scheduled to occur until some point in 2027. Alongside this change, the Employment Rights Bill will create statutory probationary periods during which a lighter touch standard of fairness will likely apply to some categories of dismissal. Most of the detail about these periods will be set out in later regulations and the government had already committed to consult about these matters. In fact, according to the government Roadmap, this consultation ought to be launched before the end of the month, as it was scheduled for summer or autumn 2025.

The parliamentary ping-pong process has led the government to make a minor compromise to the House of Lords by introducing a statutory obligation to consult on three specific issues related to these new statutory probationary periods. We suspect that at least one, if not all, of these issues were already due to be covered in the planned, forthcoming consultation.

The three issues are:

• Duration (the government’s previously stated preference is for a period of up to nine months). This was almost certainly already due to be covered in consultation.
• A specific aspect of whether dismissals for “some other substantial reason” (SOSR) will or will not benefit from the lighter-touch standards on fairness. In essence, the Bill says that those lighter touch standards will only apply where the reason for dismissal is related to the employee. This would cover dismissals on the grounds of capability, conduct or illegality, but won’t cover redundancy dismissals (i.e., an employer will have to comply with the full standards of fairness for a redundancy from day-one of employment). When it comes to SOSR dismissals, the government will have the power to specify whether a reason is or is not related to the employee and it is this power that would now be subject to a duty to consult. So, for example, the government might, after consultation, specify that a personality clash is related to the employee whereas a restructure related reason might not.
• Whether to alter the maximum compensation payable for someone unfairly dismissed in the probationary period. The Bill gives the government the power to do this and it has now committed to consult if and before it exercises that power.