The grant is ending. What do I owe the post-holder?

England and Wales: This page sets out the position in full. Scotland: the same position, with no difference in principle — employment law is reserved, and the same dismissal provisions and fixed-term regulations apply. Northern Ireland: covered, with three differences that change the answer — its own dismissal provision and fixed-term regulations, a higher redundancy weekly-pay cap, and an unfair dismissal qualifying period that the 2027 change in Great Britain does not touch; see the Northern Ireland section below.

Is the end of a fixed-term contract a dismissal?

Yes. The end of a grant does not end the job by itself. A fixed-term contract that runs out without renewal is a dismissal in law.

A fixed-term contract is one that ends on a set date or when a set event happens. For a grant post, that is usually the end of the funding. The funding and the post feel like the same thing. In law they are not.

This step is for the trustees, manager or treasurer of a charity with grant-funded posts in England and Wales, Scotland or Northern Ireland. It follows setting up the workplace pension in this hub’s order, but applies whenever a grant-funded post nears its end. Northern Ireland’s law is set out at the end.

The Employment Rights Act 1996 says that when a limited-term contract runs out and is not renewed, the employee has been dismissed. It says so twice, once for unfair dismissal and once for redundancy pay, in materially identical words.

Section 95(1)(b), for unfair dismissal, verbatim:

“he is employed under a limited-term contract and that contract terminates by virtue of the limiting event without being renewed under the same contract”

Section 136(1)(b), for redundancy pay, verbatim:

“he is employed under a limited term contract and that contract terminates by virtue of the limiting event without being renewed under the same contract”

The only difference is a hyphen. So both regimes treat the end of the grant post the same way: it is a dismissal.

If the post genuinely ceases because the money has gone, that is capable of being a fair redundancy. But capable of being fair is not the same as automatically fair. You still need a fair process, and redundancy pay may still be due.

Budget the ending before the post begins

Put the redundancy provision into the grant budget at application stage. You cannot usually go back to a funder at the end of a grant and ask for it. This is the conclusion that matters most, so it comes before the detail.

Statutory redundancy pay is due where the employee meets the continuous-service condition. It is worked out as an age-banded number of weeks’ pay for each full year of service. The number of years counted is capped. The bands are:

• Each full year under 22: 0.5 weeks per year of service
• Each full year 22 or older, but under 41: 1 week per year of service
• Each full year 41 or older: 1.5 weeks per year of service

In Great Britain a week’s pay is capped at £751, and the maximum statutory payment is £22,530. Both figures are uprated every April. The service condition and the age bands are on gov.uk’s redundancy pay page, listed in the sources below.

Notice pay, any contractual enhancement and any settlement come on top of that. None of them was covered by the research, so this page gives you no figure for them. Ask the funder what it will cover at the point you apply, and write the answer into the application. What the funder then agrees to pay is fixed in the grant agreement, covered on read and negotiate the grant agreement.

This belongs in the same calculation as the rest of the post’s cost. See how to work out what a project really costs, and the Funding and fundraising hub for building the application itself. Template: Project budget (planned).

The quieter trap: a renewed post can become permanent

A renewed fixed-term post can become permanent after a period of continuous service, unless keeping it on fixed terms was objectively justified. This catches charities that have been doing the sensible thing — renewing a good post each time the funder renews the grant.

The Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002 make a fixed-term employee permanent after a period of continuous service. That does not happen if keeping them on fixed terms was objectively justified. And it happens only where a condition is met first. Regulation 8(1), verbatim:

“This regulation applies where— (a) an employee is employed under a contract purporting to be a fixed-term contract, and (b) the contract mentioned in sub-paragraph (a) has previously been renewed, or the employee has previously been employed on a fixed-term contract before the start of the contract mentioned in sub-paragraph (a).”

Regulation 8(2), verbatim as recorded, with two passages elided in the record itself:

“…the provision of the contract mentioned in paragraph (1)(a) that restricts the duration of the contract shall be of no effect, and the employee shall be a permanent employee, if— (a) the employee has been continuously employed … for a period of four years or more, and (b) the employment of the employee under a fixed-term contract was not justified on objective grounds”.

Read the two together and the rule is narrower than it is usually stated:

• A single unbroken contract does not trigger it. One grant, one contract running the whole length, never renewed — regulation 8 does not make that post permanent, however long it runs.
• A renewed post can. The rule applies if the contract has been renewed before, or the employee was on an earlier fixed-term contract. Then, after 4 years’ continuous service, the fixed end date is of no effect.
• The exception is objective justification. It is the employer who would have to show it.

A charity that has renewed “the same” grant post two or three times may therefore have a permanent employee and not know it. When that grant ends, you are not ending a fixed-term contract at all. You are dismissing a permanent employee, and the redundancy analysis starts from there.

One further point. Regulation 8(5) lets a collective agreement or a workforce agreement modify paragraphs (1) to (3). If your charity has either, read it before relying on regulation 8.

On what is changing: regulation 8 itself has no outstanding amendments. The Regulations as a whole have one. Regulation 7(2), the tribunal time limit, is to be amended by SI 2026/758 reg. 4, which has not yet been applied.

That is part of the Employment Rights Act 2025 programme. So it is not right to say these Regulations are untouched by the 2025 Act.

What a fair process looks like here — and why it is not the Acas Code

A fair process at the end of a grant post means consultation and a real look at alternatives, not the disciplinary procedure. Charities that have been through a disciplinary process often reach for the same procedure when a grant ends. It is the wrong one. The Acas Code of Practice on disciplinary and grievance procedures says so itself, verbatim:

“The Code does not apply to dismissals due to redundancy or the non-renewal of fixed-term contracts on their expiry.”

Two things follow. First, the tribunal’s power to increase an award for failing to follow the Code does not arise on this step. Second, a disciplinary-shaped process — warnings, a hearing about conduct — is the wrong tool for an ending caused by funding.

The fairness the law does require has two sources. One is the unfair dismissal test in section 98(4) of the Employment Rights Act 1996. The other is the common law. For a post that is ending because its funding ends, that means:

• Consultation. Talk to the employee before the decision is final, not after.
• Alternatives. Consider whether there is other funding, or another role, that could keep them.

The disciplinary procedure belongs to a different situation, covered in handle sickness, absence and a first difficult conversation. Keep the two apart.

The qualifying period is changing — but not to day one

At present, unfair dismissal protection in Great Britain needs 2 years’ continuous service. Under the government’s published timeline, that period falls to 6 months for dismissals from 1 January 2027; the commencement regulations have not yet been made.

It is not becoming a day-one right. The day-one proposal and a statutory probation process were both in the Bill and were both dropped during its passage. Sector commentary written while the Bill was going through still says “day one”. The Act does not.

What this means for a grant post: a short grant used to end before most employees could claim unfair dismissal. From 2027, far more of them will be able to. If your grant runs past that mark, plan the ending as a dismissal that may be tested, because it may be.

The government’s own timeline notes that future dates remain subject to parliamentary processes. Check the date before you rely on it.

Northern Ireland: the same shape, different law

None of the Great Britain rules reads across to Northern Ireland without checking. Employment law there is its own.

The expiry is still a dismissal. Article 127(1)(b) of the Employment Rights (Northern Ireland) Order 1996 is the direct counterpart of section 95(1)(b). Under it, a limited-term contract that ends without being renewed is a dismissal. Northern Ireland puts this in one definition of dismissal rather than two separate sections. The outcome is the same.

The permanence rule exists, with a caveat. The Fixed-Term Employees (Prevention of Less Favourable Treatment) Regulations (Northern Ireland) 2002 have their own regulation 8. That regulation is confirmed to exist and to apply the same successive-contracts condition. Its text was not read word for word for this page, so treat the detail above as very likely to match, not as confirmed.

The redundancy cap is a different, higher figure. In Northern Ireland a week’s pay for redundancy is capped at £783. That is set by Northern Ireland’s own uprating order under its own index.

It is not the Great Britain figure applied late, so never use the Great Britain cap for a Northern Ireland employee. The age-banded formula is likely to be parallel, but it was not separately confirmed.

The 2027 change does not reach Northern Ireland. The unfair dismissal qualifying period there is set by Article 140(1) of the 1996 Order, verbatim:

“Article 126 does not apply to the dismissal of an employee unless he has been continuously employed for a period of not less than [one year] ending with the effective date of termination.”

That period is already shorter than the current Great Britain one. From 1 January 2027 the position flips, because Great Britain’s reform does not extend to Northern Ireland. A charity employing on both sides of the border is tracking two different periods, not one.

The Acas Code does not apply at all. Northern Ireland has its own code and keeps a statutory dismissal procedure that Great Britain repealed. This page does not establish whether that procedure applies when a fixed-term contract expires. Do not assume the Great Britain answer — that the Code is irrelevant here — carries over. Ask first.

Endings for other reasons — conduct, performance or long absence — follow a different route. It is the next and last step of this hub: handle sickness, absence and a first difficult conversation.

Common mistake: “when the grant ends, the job just ends”

It happens because the funding and the post are thought of as one thing. Sections 95(1)(b) and 136(1)(b) say, in materially identical words, that the expiry of a limited-term contract without renewal is a dismissal. Section 95(1)(b) covers unfair dismissal and section 136(1)(b) covers redundancy pay. A fair process is required and, where the service condition is met, statutory redundancy pay is due.

Common mistake: renewing “the same” grant post without noticing it has become permanent

Each renewal is treated as a fresh fixed-term contract. But a contract may have been renewed, or followed an earlier fixed-term one. Then 4 years’ continuous service makes the employee permanent, unless fixed-term status was objectively justified. A single unbroken contract does not trigger this; a renewed one can.

Common mistake: leaving the redundancy provision out of the grant application

It feels premature to budget for the end of a post before it starts. But the application is usually the only point at which you can ask for it. Budget it then.

Common mistake: assuming the qualifying period will still shelter a short grant post

Sector commentary from the Bill’s passage says “day one”; older material gives the longer period that applies today. Neither matches the government’s plan for 1 January 2027, when the period in Great Britain is due to fall to 6 months. It is not a day-one right, and the statutory probation process was dropped entirely. Northern Ireland keeps its own period.

Worked example

Tollgate Youth CIO’s one employee is its youth worker. Her post is funded by a grant that ends next spring. The same post has been renewed on successive grants before, each time on a new fixed-term contract.

The trustees start by asking the wrong question — “do we need to do anything, or does it just end?” — and then the right ones.

• Is this a dismissal? Yes. Expiry without renewal is a dismissal for unfair dismissal and for redundancy pay alike. A fair process is needed: consultation with her, and a genuine look for other funding or another role.
• Is she still on a fixed-term contract at all? Her contract has been renewed before, so regulation 8 can apply. The trustees count her continuous service across the successive contracts. If it has passed 4 years, and fixed terms were not objectively justified, she is already a permanent employee.
• Is redundancy pay due? If she meets the service condition, yes, at the age-banded rate, subject to the weekly-pay cap of £751.
• Does the Acas Code apply? No. It does not cover the non-renewal of a fixed-term contract.

The lesson Tollgate takes forward is about the next grant, not this one. Its next application includes a line for redundancy. The file for the post starts with a written end-of-contract plan and a note of whether regulation 8 has already made the post permanent.