Unfair Dismissal qualifying service changes with effect from 6th April 2012:

The Government has confirmed that with effect from 6 April 2012 the qualifying period of service required for an employee to present a claim for unfair dismissal would be extended from 1 to 2 years.

This increase will provide employers with a greater opportunity to assess the suitability and performance of new employees and more flexibility in terminating their employment if they are deemed not to be meeting the required standards.

Currently, an employee can present a claim for ordinary unfair dismissal once they have 1 years’ continuous service.  However, there are certain exceptions to this when an employee with any length of service can present a claim for unfair dismissal.

For example:

• where the individual has been dismissed for making a protected disclosure (i.e. whistle blowing)
• in relation to trade union activities
• health and safety reasons
• pregnancy, maternity or other ‘Family Friendly’ rights.

It is expected that these exceptions will continue to apply and will no doubt become more important with the future increase in the qualification requirement.  There may also be an increase in allegations and claims relating to discrimination which also do not require any qualifying period.

Consolidating a number of previous acts the Employment Rights Act 1996 confirmed the qualifying period to be 2 years but at the time there was a legal challenge to the qualification period on the basis of indirect sex discrimination (R v Secretary of State Ex. P Seymour-Smith (2000) – a case which was based on a dismissal which took place in 1991.

Mrs Seymour-Smith claimed that the requirement for 2 years’ service to bring  a claim for unfair dismissal was indirectly discriminatory against women, and therefore incompatible with the Equal Treatment Directive, since less women were able to comply with the requirement (to have 2 years’ service) than men.

The House of Lords held that although the 2 year requirement did constitute indirect discrimination contrary to the Directive the Government had ‘objectively justified’ the requirement – to encourage recruitment by employers.

With effect from 1st June 1999 the 2  year qualifying period was reduced to the current 1 year requirement.  It remains to be seen whether another challenge to the 2 year requirement will be mounted once the increase takes effect in April and if so, whether the challenge would result in the same outcome as in the earlier Seymour-Smith case.

The increase to 2 years service to pursue a case of Unfair Dismissal will bring the position in line with the qualification requirement for a redundancy payment which, under the statutory scheme, requires an employee to have 2 years’ service.