The Employment Rights Bill will now go ahead after House of Lords achieved a win over government plans to legislate for unfair dismissal right from day one of employment.

There will now be a six-month qualifying period for unfair dismissal, an improvement for employees who currently need to wait two years for such claims.

The final decision involved lengthy discussions with employers, key stakeholders and unions before final agreement could be reached.

Under the new plan, the unfair dismissal elements of the Employment Rights Bill will be watered down allowing the Bill to go forward to Royal Assent and meet the government’s timetable to introduce the first major day one rights in April 2026.

Confirming the decision, the Department for Business and Trade said: ‘This will mean delivering day one rights to sick pay and paternity leave in April 2026 as well as launching the Fair Work Agency.