For most UK SMEs, probation periods have always been useful.

They give both sides a chance to work out whether the role, the expectations and the fit are right. They create space for early feedback, clearer conversations and, where needed, honest decisions.

But with the unfair dismissal qualifying period due to reduce from two years to six months on 1st January 2027, probation periods are becoming much more than a sensible HR process. They’re becoming a key part of how employers manage risk, performance and decision-making at the start of employment.

For SMEs without in-house HR, that matters. Because six months comes around quickly.

What is actually changing in January 2027?

From 1st January 2027, protection against ordinary unfair dismissal is due to apply after 6 months’ service, rather than the current 2 years. The qualifying period for the right to request written reasons for dismissal is also reducing to 6 months. ACAS notes that this is a change from the earlier expectation of day-one protection.

That means this is no longer really a conversation about a long runway for assessing a new hire.

It’s about whether you are using those first few months well.

Why probation periods matter more under the new rules

A probation period does not remove legal obligations. It does not give employers a free pass. And it only helps if it is actually managed.

But in practice, a well-run probation period gives you something very important.

It gives you structure.

That structure matters more when the point at which ordinary unfair dismissal rights apply is moving much earlier in the employment relationship. Government material and ACAS guidance both point to January 2027 as the implementation point for that shorter qualifying period.

For many employers, the real implication is simple.

If there are concerns about capability, conduct, fit or readiness for the role, you may have much less time than you’re used to in order to identify them, address them and make a considered decision.

The practical problem for growing SMEs

This is where I think many businesses get caught out.

On paper, they have a probation policy.

In reality, the process is passive.

The contract says six months. The handbook mentions review points. Everyone means well. But then the manager gets busy, the meetings move, the concerns are raised late, and the probation end date passes without a proper decision.

That has always been unhelpful.

From January 2027, it may also become much riskier.

Employment law commentary since the change was confirmed has repeatedly pointed to the need for stronger probation processes, better documentation and more deliberate decision-making in the first six months. Some have also highlighted that internal probation periods do not override the statutory qualifying period.

A probation period should not be a formality

Used properly, probation is not about catching someone out.

It’s about giving them the best possible chance to succeed while also being realistic about what the business needs.

A good probation process usually includes:

Clear expectations from the start

New starters need to know what good looks like. Not in vague terms, but in practical ones. What outcomes matter? What behaviours matter? What would make you confident they’re settling in well?

Regular check-ins

Small, structured conversations early on are far more useful than one big conversation at the end. They give the employee a fair chance to respond and improve, and they help managers address issues before they become embedded.

Honest feedback

If something is not working, it needs to be said clearly and early. Not harshly. Not dramatically. Just clearly.

A genuine review point

A probation end date should trigger a decision, not simply arrive and pass by unnoticed.

A written record

You do not need pages of paperwork for the sake of it. But you do need enough to show what expectations were set, what feedback was given and what decision was made.

Why the six-month point matters so much

One of the more important practical points here is that the new unfair dismissal threshold is aligning closely with what many employers already use as a standard probation period.

That sounds neat on the surface, but it also means there is less room for drift.

If your probation process is built around a six-month period, it needs to be active well before month six. Not because every probation concern becomes a claim, but because good process is harder to build in retrospect. Commentary on the Act has noted exactly this pressure point for employers.

In other words, a six-month probation period may still be entirely sensible.

But only if it is managed like it matters.

This is not just about legal risk

It’s also about leadership quality.

When probation is handled well, people know where they stand. They get feedback earlier. Managers build confidence in having straightforward conversations. And the business makes better decisions while there is still time to act thoughtfully.

That is better for the employee and better for the organisation.

Waiting until a problem has become obvious to everyone rarely creates a fairer or easier outcome.

What employers should be reviewing now

Ahead of January 2027, this is a good moment to sense-check whether your current approach is doing what you think it is.

For many SMEs, that means looking at questions like:

• Are probation periods clearly set out in contracts and policies?
• Do managers know when review points should happen?
• Is there a consistent way to record concerns, support and outcomes?
• Are probation decisions being made before deadlines pass?
• Are managers confident having early, fair and evidence-based conversations?

These are not dramatic changes. But they are important ones.

Final thought

The legal change coming in January 2027 is not day-one ordinary unfair dismissal rights. It is a move from two years to six months. That is still a significant shift, and one that makes the early months of employment much more important for employers who want to make fair, confident decisions.

A probation period on its own will not protect a business.

But a properly managed probation period process gives you something much more useful than a clause in a contract.

It gives you clarity.

And when expectations, evidence and timing all matter more, clarity is exactly what you want.

If this resonates, it’s something we support businesses with.

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