Managers To Benefit From Greater Protection From Unfair Dismissal under The Employment Rights Act 2025?

The^[1] Employment Rights Act 2025 (ERA 2025), which received Royal Assent on 18 December 2025, could represent a structural shift in how dismissal disputes involving football managers will be handled. Historically, such disputes have been channelled through private arbitration, most notably the Managers’ Arbitration Tribunal, rather than the Employment Tribunal. As explained in Article 1, this was driven by two key statutory barriers: the two-year qualifying period and the statutory cap on the compensatory award for ‘ordinary’ unfair dismissal claims, which rendered unfair dismissal rights largely irrelevant and not commercially prudent for managers whose average tenure remains well below two years.^[2]

From 1 January 2027, the combination of a six‑month qualifying period and the removal of the statutory cap will dramatically increase managers’ ability to pursue unfair‑dismissal claims. For managers—whose contractual terms already govern both the structure of their working relationship and the mechanics of their departure—this represents a significant shift in negotiating power. These statutory reforms also intersect with the unique volatility of managerial employment, where dismissals occur throughout the season due to performance pressures, ownership changes and broader structural expectations.

This article examines:

• how ERA 2025 reshapes the litigation and negotiation landscape for managerial terminations; and
• the practical steps clubs should now take, including changes to contractual drafting and consideration of performance management processes for managers.

It should be read alongside Article 1 (which provided an overview of the core reforms) and Article 2 (which discussed the specific implications for footballers), which set out the wider context in which managerial disputes will now sit.

Article Outline

• Changes brought about by ERA 2025
  • The Right not to be Unfairly Dismissed
  • Removal of the Statutory Cap: A New Litigation Dynamic
  • Reduction of the Qualifying Period
  • Capability Dismissals and Warnings: Heightened Standards in a Volatile Environment
    • Capability-based dismissals: the new standard
    • Warnings: when are they required?
  • Parallel Claims and Jurisdictional Overlap
  • Avoiding Parallel Proceedings: Post‑Termination Arbitration Agreements
  • Strategic Implications
  • Tribunal Backlog and Timing
  • Conclusion
  • Practical Takeaways
  • For Clubs
  • For Managers
  • For Advisers