Probation
Probationary periods have virtually no legal basis whatsoever, other than in contract law. They are widely used, however, and give an employer a fig leaf to hide behind when they are terminating someone’s employment during or at the end of their probationary period. An obvious advantage of using a probationary period clause is that the length of notice during that time can be reduced. If you typically have employees on one month’s notice then you may wish to have a probationary term of only one week’s notice. Senior management may usually be on three months notice but during the first six months of probationary service it could be reduced to one month. It should make it cheaper, quicker and less painful for the employer to part company if it does not work out.
But beware, you may just run into problems if the period is not properly monitored or acknowledged, or simply not formally signed off and finished. We recommend reviewing new employee’s progress on a monthly basis with them.
If they are struggling then you can intervene quickly and sort things out to everyone’s satisfaction by giving guidance and support. As ever, it is always a good idea to record brief notes about these reviews and if there are on-going concerns make sure the employee is given a copy of the notes so they fully understand what they need to do to improve.
If the worst happens, and they are not working out as expected, you may decide to end the relationship sooner rather than later. If you have been reviewing regularly the result should not come as a surprise. They are much less likely to get emotional or look for some ulterior motive to explain your decision to terminate the contract.
There is another aspect to probationary periods which is often overlooked. If you get his with a claim for discrimination or something other than poor performance, proper monitoring and records will probably reduce legal exposure.
If probation periods are managed well then this is a powerful proposition. Sadly many people do not formally review as they go along, forget about the end of it and then try to catch up or just assume that the employee will know they are ‘permanent’ because they only really invoke the probationary clause when they want to get rid of someone. If you are not going to do it properly it is best not to do it at all – there is at least one court case where an employee won a breach of contract claim because the contractual provision implied they were going to do it properly but did not!
If you do decide to retain probationary periods then make sure that you write in a probationary period of ‘up to’ x months or make very clear provision for termination during the period to avoid a claim that the probationary period of X months is actually a fixed term contract for that time and cannot be broken without compensation for the remainder if terminated earlier.
Finally probationary periods can be extended but you would need to write to the employee prior to the probationary period ending confirming that this is the employer’s intent and the reasons for it. Again using the term ‘up to’ a further 3 months is advisable.
Remember:
* Probationary periods have little legal weight
* They can allow shorter notice periods for the early days
* Monitor it properly, do not leave it until the last day
* Intervene early if there are problems and give support
* Proper record keeping will protect against other claims
* Periods can be extended, but you must confirm this in writing before the period has ended
* Write the provision carefully to ensure it cannot be read as a guaranteed period of probation”.”””
