Fashion businesses depend on flexibility, whether recruiting for peak trading periods, reorganising stores or using casual staff to respond to demand. The Employment Rights Act 2025 introduces some of the most significant employment reforms in a generation and will require businesses to plan earlier and pay greater attention to process.
From 1 January 2027, the qualifying period for ordinary unfair dismissal will fall from two years to six months. The statutory cap on compensation will also be removed.
Employers can still dismiss for potentially fair reasons such as misconduct, capability or redundancy, but must also act reasonably and follow a fair process. That can take time.
Recent fashion-sector cases involving Burberry and H&M illustrate the point.
In Simpson v Burberry Ltd, an investigation into alleged misuse of the employee discount policy was followed by disciplinary proceedings and an appeal. The Tribunal found the dismissal fair. In Urzedowicz v H&M, a detailed appeal corrected an error in the original dismissal decision, with the Tribunal ultimately finding that H&M had acted reasonably. These cases demonstrate the importance of a structured process and an effective appeal.
Fashion businesses often recruit at pace. From 2027, they will have less time to decide whether a new recruit is right for the business. Performance or conduct concerns should therefore be identified early and probation reviews...
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