Unfair dismissal under 2 years of service is supposed to be off the table. That is the version of the rule most SME owners carry around. Someone has been here fourteen months, it is not working out, so we can part ways without much process. Most of the time, that holds. The times it does not hold are expensive, and they follow a pattern you can learn. 

The general rule is that an employee usually needs a qualifying period of two years' service before they can claim ordinary unfair dismissal, and the full eligibility picture is covered in our guide to when dismissing someone becomes an unfair dismissal. 

This article is about the exceptions. The claims that need no qualifying period at all, the ones that catch employers who thought short service made them safe, and the change arriving on 1 January 2027 that shrinks the two-year window to six months for most employees. If you employ people and you have ever relied on "they have not been here long enough to claim", read on. 

Can you claim unfair dismissal under 2 years? 

Yes, in specific circumstances. GOV.UK puts it plainly: the qualifying period is usually two years, but in some cases it is shorter or does not apply. 

There are four main routes a short-service employee can take. 

1. An automatically unfair reason for dismissal. No qualifying period applies to most of these. 
2. A discrimination claim under the Equality Act 2010. This is a separate claim type with no service requirement at all. 
3. A whistleblowing claim. Dismissal for making a protected disclosure needs no qualifying service, and compensation for it is uncapped. 
4. A contractual claim. Dismissing someone without proper notice is a wrongful dismissal claim from day one, whatever their service. Our guide to wrongful dismissal covers how those claims work. 

Here is the practitioner reality behind that list. When an employment adviser meets an employee dismissed with less than 2 years' service, they do not conclude there is no claim. They go looking for one of the four routes above. A tribunal claim form lets a claimant plead several of them at once. The question they ask is not "was the dismissal procedurally fair", because for ordinary unfair dismissal that door is shut. The question is "what does the timeline suggest the real reason was". If your paperwork cannot answer that, the claim gets issued and you are defending it. 

One nuance worth a line: in Northern Ireland the qualifying period is still usually one year, not two. This article covers the position in Great Britain. 

Automatically unfair dismissal reasons: the list that ignores service 

Some reasons for dismissal are classed as automatically unfair. If the dismissal is for one of these reasons, the fairness of your process does not save you, and for most of them the two-year qualifying period does not apply. 

GOV.UK lists the areas an automatically unfair dismissal can relate to: 

1. Pregnancy, including all reasons relating to maternity. 
2. Family leave, including parental leave, paternity leave, adoption leave or time off for dependants. 
3. Acting as an employee representative. 
4. Acting as a trade union representative, or joining or not joining a trade union. 
5. Taking part in official industrial action. 
6. Acting as an occupational pension scheme trustee. 
7. Being a part-time or fixed-term employee. 
8. Pay and working hours, including the Working Time Regulations, annual leave and the National Minimum Wage. 
9. Whistleblowing, which is covered in its own section below. 

Read item eight again. It is the one SME owners skim past, and it is the one that catches them. 

Automatically unfair dismissal examples that catch small employers 

The classic automatically unfair dismissal examples are rarely dramatic. They look like ordinary management decisions with bad timing. 

An employee on month nine asks why they are not getting the minimum wage uplift. Two weeks later they are dismissed for "attitude". A part-time employee asks for the same hourly treatment as full-time colleagues, then finds herself first out in a quiet patch. A new starter queries unpaid holiday, or refuses to work hours that break the Working Time Regulations, and the relationship sours fast. An employee books time off for a childcare emergency and is let go the following week for "reliability". 

Notice what is missing from those examples: length of service. It never comes up. Whether the employee had been there nine weeks or nine months changes nothing, because these categories do not run on a service clock. A probationer has exactly the same protection here as a five-year veteran. Dismissing during probation gives you no special cover against any of them. 

In each case the employer usually believes the stated reason. The tribunal does not have to. It looks at the sequence of events and asks what really drove the decision. A dismissal that lands shortly after an employee asserted a statutory right, announced a pregnancy, or asked an awkward question about pay is a dismissal that invites the inference. With no documented performance concerns predating that moment, the inference is hard to resist. 

The defence is not clever argument after the event. It is a paper trail that predates the trigger. If the performance concerns were real, they should exist in writing before the employee asked about their holiday pay, not after. Some of these reasons also carry a minimum basic award on top of the ordinary remedies, which is one more reason the label matters. The award mechanics are set out in our guide to unfair dismissal compensation. 

Discrimination claims need no service at all 

Discrimination is not an unfair dismissal claim with the service requirement removed. It is a different claim entirely, brought under the Equality Act 2010, and it has never had a qualifying period. A candidate can bring one before they are even hired. 

The Act protects nine protected characteristics: age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex, and sexual orientation. That protection expressly covers dismissal, along with recruitment, pay, promotion and redundancy. It reaches further than many employers realise: the same GOV.UK guidance confirms protection for someone associated with a person who has a protected characteristic, such as a parent of a disabled child, and for someone who has complained about discrimination or supported a colleague's complaint. 

For a short-service dismissal, the pattern to watch is the same one as above: timing. The employee who is dismissed three weeks after disclosing a disability. The probationer whose "fit" concerns surface only after she announces a pregnancy. The employee let go shortly after raising a complaint about racist comments, which can also be victimisation, a separate protected route. None of these employees can bring ordinary unfair dismissal claims. All of them can bring discrimination claims, and the compensation regime is different, including awards for injury to feelings. Our guide to the compensation rates for discrimination cases covers the current figures. 

The practitioner point: in a discrimination claim, once the claimant establishes facts from which discrimination could be inferred, the employer needs a credible non-discriminatory explanation. "We just did not think it was working out", with nothing in writing, is not a credible explanation. It is a vacuum, and tribunals fill vacuums with inferences. 

Whistleblowing: protected from the first day 

An employee who is dismissed for making a protected disclosure needs no qualifying service. A protected disclosure means reporting certain types of wrongdoing in the public interest: a criminal offence, a danger to health and safety, environmental damage, a miscarriage of justice, a legal breach, a cover-up, or sexual harassment. 

Two features make this the most dangerous category for an employer to misread. 

First, disclosures rarely arrive labelled as whistleblowing. They arrive inside grievances, emails and meeting comments. "I do not think we should be doing this, it is not safe" from an employee in month four can be a protected disclosure. If that employee is dismissed soon after, the dismissal invites a claim, and the employer often never realised a disclosure had been made. 

Second, compensation. Tribunal awards for unfair dismissal are normally capped, but GOV.UK confirms the cap does not apply in cases relating to whistleblowing or health and safety. The realistic ceiling in an ordinary case, explained in our compensation guide, simply is not there. 

Health and safety dismissals deserve their own sentence here, because they sit in the same uncapped territory. An employee dismissed for taking action over a genuine safety concern, refusing to work in conditions they reasonably believed were dangerous, or raising the alarm about risk does not need two years' service either. In a small business where the owner is close to every operational decision, "he refused to do the job" and "he refused to do the job unsafely" can look identical in the heat of the moment. Only one of them is a safe dismissal. 

The discipline that protects you is unglamorous: before dismissing anyone who has recently raised a concern, read the concern again. Ask whether it could be a disclosure about wrongdoing rather than a personal complaint. If it could be, take advice before acting, not after. 

From 1 January 2027, two years becomes six months 

The biggest change to this area in a generation is already scheduled. GOV.UK confirms that from 1 January 2027, most employees will be able to claim unfair dismissal after six months, under the Employment Rights Act 2025. 

Sit with what that means for an SME. Today, a hire that goes wrong at month ten can usually be ended with notice, a short meeting and a clean letter. From January 2027, that same employee can bring an ordinary unfair dismissal claim, which means reason and process are both in play. The informal short-service exit, no documented concerns, no review meetings, no letters, stops being low-risk for everyone hired more than six months ago. 

Three practical consequences follow. 

1. Probation stops being a paperwork afterthought. A six-month qualifying period makes the first six months the entire low-risk window, and most probation processes are not built to make a fair decision that fast. Our guide to probationary periods explains why they already give less protection than employers assume. 
2. Late-2026 dismissal decisions need a date check. Rights turn on when the dismissal takes effect, not when you decided. A decision made in November with a termination date after 1 January 2027 lands under the new rules. If you are managing someone out over the year end, know which side of the line the effective date falls, and confirm the position at the time rather than assuming it. 
3. The process habit has to be built now. Managers who have never run a fair dismissal process for short-service staff will not learn it in the week the law changes. Every dismissal from now on is practice for the regime you will be operating in from January. 

The exceptions in this article do not go away in 2027. Automatically unfair reasons, discrimination and whistleblowing still need no qualifying period at all. The qualifying period is not the only thing changing that day: the same commencement removes the cap on the compensatory award for ordinary unfair dismissal, so the ceiling that separates ordinary claims from whistleblowing claims goes with it. The change narrows the gap between the protected categories and everyone else. 

What to do before you dismiss anyone with short service 

The pattern across every category above is the same. Employers get caught not because they intended anything unlawful, but because they had nothing in writing that showed what they did intend. A short-service dismissal claim rarely turns on what the employer meant. It turns on what the tribunal can see, and on which story the documents support. So the checklist is short. 

1. Write down the real reason before you act. One paragraph. If you would be uncomfortable reading it to a tribunal, stop. 
2. Check the timeline. Has this employee, in recent months, announced a pregnancy, raised a grievance, asked about pay or holiday, reported a safety concern, requested time off for a dependant, or disclosed a disability or other protected characteristic? If yes, the dismissal will be read against that event. Take advice first. 
3. Run a short, fair process anyway. A letter, a meeting, a chance to respond, a decision confirmed in writing. It is a modest cost next to defending a claim, and the cost of defending even a weak claim is real, win or lose, as our guide to employment tribunal costs sets out. 
4. Pay notice correctly. Getting the money wrong adds a day-one wrongful dismissal claim to whatever else follows. 
5. Keep everything. Notes, letters, the reason paragraph. In a tribunal, what is not written down did not happen. 

None of this is about making dismissal harder. It is about making the dismissals you were going to do anyway defensible, this year under the two-year rule, and next year under the six-month one. 

Frequently asked questions

Can an employee claim unfair dismissal with under two years' service?

Yes, in specific circumstances. GOV.UK confirms the qualifying period is usually two years, but in some cases it is shorter or does not apply. There are four main routes: an automatically unfair reason, a discrimination claim, a whistleblowing claim, or a contractual claim for dismissal without proper notice.

Which reasons for dismissal are automatically unfair?

GOV.UK lists pregnancy and maternity, family leave, acting as an employee or trade union representative, taking part in official industrial action, being a pension scheme trustee, being part-time or fixed-term, and whistleblowing. It also covers pay and working hours, including annual leave and the National Minimum Wage. For most of these, no qualifying period applies.

Can a short-service employee claim discrimination after being dismissed?

Yes. A discrimination claim under the Equality Act 2010 is a separate claim with no service requirement, and a candidate can bring one before being hired. The Act protects nine protected characteristics and expressly covers dismissal. A short-service dismissal with nothing in writing leaves the employer without a credible non-discriminatory explanation.

Is compensation capped when an employee is dismissed for whistleblowing?

No. Dismissal for making a protected disclosure needs no qualifying service, and GOV.UK confirms the cap on unfair dismissal awards does not apply in cases relating to whistleblowing or health and safety. A disclosure often arrives inside a grievance or an email, so the employer may not realise one was made.

What changes for unfair dismissal on 1 January 2027?

From 1 January 2027, most employees will be able to claim unfair dismissal after six months instead of two years, under the Employment Rights Act 2025. The same commencement will remove the cap on the compensatory award. Rights turn on when the dismissal takes effect, not when you decided. Automatically unfair reasons, discrimination and whistleblowing still need no qualifying period.

What should I do before dismissing someone with short service?

Write down the real reason first, in one paragraph. Check the timeline for a recent pregnancy announcement, grievance, pay or holiday query, safety concern or disclosure of a disability. Run a short, fair process anyway, pay notice correctly and keep every note and letter. In a tribunal, what is not written down did not happen.

If you are not sure where your dismissal paperwork and processes stand, start with the free HR Health Check. It takes under a minute and lets you know where your business is exposed before a short-service dismissal turns into a long claim. 

Richard, Director, OES HR