The government will commit to bringing in enhanced protections against unfair dismissal from the start of 2027, after watering down its plans last week.

Labour ministers agreed to introduce the right to make a claim after six months in a job instead of on day one, after a backlash from business groups.

This new qualifying period would still be shorter than the current two years.

At the time of last week’s climbdown, the business department did not specify when the amended six-month right would come into force.

However, ministers are now expected to make a commitment to implement the new protection from 1 January 2027, when the legislation to deliver the change returns to the House of Commons on Monday.

Such assurances, made from the dispatch box, are not legally binding but are seen as carrying additional political weight by MPs and peers.

The move, which was first reported by The Guardian, followed talks this week between ministers and former deputy PM Angela Rayner and ex-employment minister Justin Madders, two key architects of the original proposals.

Following the talks, Rayner agreed to withdraw an amendment she had planned to table, which would have made the start date 2026.

Writing on social media, Rayner appeared to welcome the government’s decision, saying a January 2027 start date would introduce protection for those hired after July 2026, bringing “real change for workers”.

Currently, after two continuous years in a job workers gain additional legal protections against so-called “ordinary” unfair dismissal.

It means employers must identify a fair reason for dismissal – such as conduct or capability – and show that they acted reasonably and followed a fair process.

Until last week, Labour was planning to scrap this qualifying period completely at an unspecified point during 2027, with a new legal probation period, likely to have been nine months, introduced as a safeguard for companies.

But following talks with unions and business groups last week, the qualifying period will instead be set at six months’ service, and the legal probation period shelved.

The U-turn has been widely welcomed by business groups, which had warned the original proposals would discourage companies from hiring.

It has been condemned by some MPs on the left of the Labour Party, as well as the Unite union, a major donor through the affiliation fees its members pay to the party.

The government still plans to bring in new day-one rights to sick pay and paternity leave rights from April 2026.

Separately, the government is also expected to abolish the current limits on compensation for financial loss in ordinary unfair dismissal cases.

Currently, awards to former employees who successfully bring a claim are limited to either their annual salary or £118,223, whichever is lower.

But the government plans to amend its employment rights bill to abolish both these caps, as the bill goes through its final stages in Parliament.

This would bring the process more into line with “automatic” unfair dismissal cases – where workers have been sacked for reasons such as discrimination and whistleblowing – where financial loss awards are uncapped.

Abolishing the caps did not feature in the original version of the bill unveiled in October last year, or in Labour’s general election manifesto.

But ministers committed to do so last week during talks to reach an agreed route forward between some unions and industry groups.

Pensioners living in two tower blocks said they felt like “second class citizens” after a social landlord quadrupled their heating and hot water bills overnight.

It was now cheaper to boil a full kettle than it was to fill a washing up bowl with warm water, according to residents in Woodall and Hamilton House, in Bloxwich, Walsall.

On 1 October, tenants in Woodall House saw their prices go from 4p per kWh to 13.75p, while the unit price in Hamilton House increased from 4p to 17.67p per kWh.

The landlord Walsall Housing Group (WHG) said it could no longer afford to subsidise “low rates” and that customers with concerns could contact them for help.

The firm removed individual gas boilers from flats in 2021 for safety reasons, and installed a central heat network at both blocks.

Although the firm covered a “large part” of the cost, bosses said it was no longer sustainable to continue subsidising energy rates.

According to energy price comparison website Uswitch, the average cost of gas in the UK is 6.29p per kWh and 26.35p per kWh for electricity.

Resident David Turner, 73, said he was “very frugal” with his heating, adding that he only had the heating on in one room.

“Even then I’m using £3 a day,” he said. “It is really astronomical. I wouldn’t expect everybody else to do what I’m doing. I’ve got arthritis so I do feel the cold.”

Kathleen Haughton, 96, said she could not understand the new prices.

“We had a meeting in the community room and they’d already put it up,” she said.

“We’d like to see the prices go down. You’ve got to have your heating on sitting in your flat.”

WHG said the average user was still paying less than the national average for hot water and heating.

Bloxwich East councillor Mark Statham criticised the housing provider for the difference in prices between the two blocks.

“The only way you can get to the blocks being different prices is if they analyse how much they make from each block and divide it by how much it costs to run it,” he said.

Compounding the issue, the heating went off in Hamilton House for about 16 hours over the weekend, which residents claimed was almost a monthly occurrence.

“I think it’s bordering on an insult,” Mr Turner said. “It’s treating us as second class citizens to a degree.”

He added: “We know inflation increases but this is more than inflation.”

Rob Gilham, a director at WHG, said the firm would never plan to make a profit from heat supply.

“For several years we’ve kept charges far below the true cost by covering a large part of the expense ourselves,” he said.

“Customers have been paying around £200 per year on average for heating and hot water, well below expected energy costs for these types of properties.

“It was not sustainable to continue subsidising these low rates for a small number of customers.”

Mr Gilham said the increase meant customers were now paying the “full and fair” cost of the energy they use.

An average user would pay between £412 and £530 he said compared to the national average of £1,266, according to regulator Ofgem.

“We understand that some people are making careful choices about how they use energy, and we urge anyone who is struggling to contact us.

“We offer confidential money advice and one-to-one support, and no customer will ever be disadvantaged for raising a concern.”