From discussions with our clients and local businesses recently, it appears that there is still an inappropriate reliance on the two-year dismissal rule. Managers are still relying far too heavily on the fact that employees do not accrue rights for two years in order to make dismissals. This is rather than managing their under-performers or disruptive staff properly and/or having the necessary performance management or difficult conversations with them in an appropriate timescale.

To be clear from a legal perspective, employee rights do not accrue until two years’ service have been fulfilled. So, an employer could, strictly speaking, dismiss an employee without any reason if their service is less than two years. However, we think this is neither ethical nor admirable; and if proper management processes are carried out, it isn’t necessary either.

There are also some other factors to consider: 

• If the employee has a protected characteristic, there is always the risk of unfair dismissal and a discrimination claim, even under two years
• If the employee’s notice period takes them over the two-year period then they would accrue rights
• A tribunal may find a dismissal made close to two-years’ service without just cause, cynical
• If an employee has officially passed probation, then a due process for dismissal should be undertaken and tribunals take a dim view if it has not been
• Other than in some rare instances, employees should be granted dignity and respect
• Having a culture of under two-year dismissals may affect engagement, retention and recruitment

Realistically, it should be a rarity for an employee to be dismissed shortly before they reach two-years’ service. A redundancy situation might be the exception. Those with under two-years’ service are going to be dismissible for the lowest cost. It may not always be desirable to get rid of the newest employees during a redundancy process, but the fact that no statutory redundancy payment will be due is certainly going to be a consideration.

Otherwise, you should be asking yourself, “How did it get to this?”

Your probationary period should be your first tool. Three months is pretty standard, and during probation employees should be undergoing an effective induction programme, to both the company and their job, and should receive regular and numerous feedback and review meetings. These meetings should be used to check understanding, assess training needs and set objectives. They’re also an opportunity to evaluate aptitude and capability for the job. If things aren’t working out, during probation is the most appropriate time to dismiss.

At the end of the initial probationary period, if your employee hasn’t made the grade then you should be considering dismissal. If there is potential for them to attain the required standard, with some further training perhaps, then you can extend probation to give them a further chance. If they have demonstrated competence, ability and aptitude and your happy with them as an employee then you should officially sign-off their probation, preferably in writing.

Following probation, if concerns arise about any aspect of the employee’s work, attitude or attendance, then it should be dealt with at that time. This may simply require an informal chat, or a more formal disciplinary process. Leaving issues unchallenged or not dealt with is likely to be a sign that the line manager isn’t confident in how to approach the situation.

Unchecked persistence of the issue is where we are likely to see a manager wanting to make a summary dismissal with the two-year time frame.

There are times when an employee does fall off the rails following their probation sign-off, but we should investigate why this has happened. Perhaps they have become disgruntled or discontented after being overlooked for a promotion, or they may just have become bored with their job or not get on with another member of staff. Again, there are management skills and processes that, properly executed, can recover such a situation and remove the need to look for dismissal as the only solution.

Tackling the two-year dismissal mindset amongst your managers carries a number of benefits. Primarily there will be cost savings as the recruitment, training and lower productivity in the early stage of employment all come with a price tag. More importantly though is the improved morale and employee engagement you’ll get from staff who are effectively managed, which will by default improve productivity and therefore profit.

As a first step, why not talk to us about undertaking a People Plan and Training Needs Analysis. An hour or two discussing your plans and the training needs of your team could pay dividends. And if you or any members of your team are in Worcestershire, we have access to some funding that could assist. Call us on 01452 331331 or email This email address is being protected from spambots. You need JavaScript enabled to view it.