What you need to know about probationary periods

With so much demand in the job market, many people will be starting new roles – and this means many employers will be managing new team members through a probationary period.

As an employer, it’s important to be aware of your obligations, and make sure any employee probation is carried out according to legal requirements.

In the video below, Andrew Jewell, principal lawyer with Jewell Hancock Employment Lawyers, explains what you need to know about probationary periods. He also answers some common questions about employer rights and responsibilities.

A probationary period – or probation period – is a set length of time decided by an employer at the start of employment. It provides both employers and employees with an opportunity to see if the role and business is a suitable fit.

While employees are on probation they receive the same entitlements as someone who isn’t in a probationary period.

How long a probationary period should be “There’s no strict rule on the required length of a probationary period,” Jewell says. “However, because the qualifying period (the minimum period of employment after which an employee can make an unfair dismissal claim) is six months, an employer shouldn’t put in a probationary period that’s longer than six months.”

A shorter period of notice A probationary period means that either you or your employee can terminate the contract on a relatively short period of time (for example, one week) but after probation ends, this typically becomes a longer period of time (for example, four weeks).

The benefits of a probationary period One of the key benefits of a probationary period is that it gives you six months to assess whether an employee is the right fit for your business. “Within that time, it’s simpler to end the employment arrangement,” Jewell says.

When employers can extend a probationary period It’s important to note that if you need additional time to determine whether the employee is a good fit for the role and business, you’ll need their consent. “An employer can’t extend a probationary period without the employee’s agreement,” Jewell says. “My advice would be if an employer doesn’t think an employee is the right fit for the business, they should make a decision then, rather than seeking to extend the probationary period.”

Terminating an employee on probation While you are entitled to dismiss an employee during probation if they are not performing as expected, you are not allowed to terminate during any period for an unlawful reason, such as:

1. 1.

   a discriminatory reason such as race, colour, sex, age, physical or mental disability, pregnancy, religion, political opinion or nationality;

2. 2.

   because the employee has made a workplace complaint;

3. 3.

   because they’re a member of a union.

When employees can make an unfair dismissal claim “Employers basically need to know that employees have a right to an unfair dismissal claim after six months,” Jewell says. “So regardless of any probationary period, an employee can’t make an unfair dismissal claim in the first six months.”

At the end of a probationary period Once probation ends, Jewell says that an employee essentially becomes a permanent employee. “All that really means is that they qualify for the longer period of notice,” he adds.

You can find more information about probationary periods as well as templates to help manage the process at the Fair Work Ombudsman.

Information provided in this article is general only and it does not constitute legal advice and should not be relied upon as such. SEEK provides no warranty as to its accuracy, reliability or completeness. Before taking any course of action related to this article you should make your own inquiries and seek independent advice (including the appropriate legal advice) on whether it is suitable for your circumstances