Employment Rights Act 2025: Changes to unfair dismissal rights for schools
23rd June, 2026
The Employment Rights Act 2025 will bring in many changes over the next two years and one of the most significant applies to unfair dismissal legislation.
What is the current law?
Employees are required to have two years’ continuous employment to be eligible to bring a complaint of ordinary unfair dismissal. Two years means two complete calendar years so someone who was employed on 1 September 2024 would have two years’ service if their notice expired on 31 August 2026.
What is changing?
With effect from 1 January 2027, employees will only need 6 months’ continuous service. This means that anyone who started employment on or before 1 July 2026, who would not be able to claim unfair dismissal under the current regime, will be eligible to claim ordinary unfair dismissal on 1 January 2027. In addition, the cap on compensation for unfair dismissal (which is currently the lower of £123,543 or 52 weeks’ pay) will also be removed on 1 January 2027 which means that employees could receive much higher compensation.
Why is this important for schools?
Under the ‘Conditions of service for school teachers for England and Wales (a.k.a the ‘Burgundy book’), schools are only able to terminate a teacher’s employment at the end of a term, which it specifies as 31 August (the ‘Summer term’), 31 December (the ‘Autumn term’) and 30 April (the ‘Spring term’). As such, schools will need to start any dismissal process and serve notice far earlier than most other employers to ensure that these notice periods are complied with. Support staff will usually be entitled to one month’s notice so are less impacted by the change.
What should schools be doing now?
All schools should be checking which employees started employment on or before 1 July 2026. If there are concerns about their performance, conduct or capability within the school which means that the school does not wish to continue to employ them in the long term, then the school would need to carefully consider whether any individual employee has more than six months service as of 1 January 2027.
What about fixed term contracts?
There is no carve out for employees on a fixed term contract, so an employee who is employed on a fixed term contract for six months or more will be able to claim unfair dismissal from 1 January 2027. Provided the fixed term contract is genuine, such employees could potentially still be dismissed but the school would need to follow a fair process and relying on a fair reason, typically redundancy or some other substantial reason. The reason relied upon would determine exactly what process you followed as, for example, if you make someone redundant you would need to consider who else should be in the pool and check for suitable alternative vacancies.
Anything else schools should be aware of?
Notice of termination does not take effect until the employee is informed (either in writing or verbally) that they have been dismissed. If dismissal is communicated only in writing, and if they are away from home because they are on holiday, then notice of dismissal would not take effect until they have returned and read the letter.
Care should also be taken if the employer exercises its contractual right to pay in lieu of notice. If an employee is paid in lieu of notice then statutory notice can be added to the termination date. Statutory notice for employees with more than one month’s service but less than two years’ service is one week. Therefore, a short serving employee should either work their notice in full, or, if they are paid in lieu, their employment needs to end on or before 23 December 2026 so that the one week’s statutory notice does not extend into January 2027 (upon which date unfair dismissal rights would take effect).
To discuss any of the above, please contact a member of our education team.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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