How to use Probation Periods effectively in Your Business

PROBATION PERIODS

HOW TO USE THEM EFFECTIVELY IN YOUR BUSINESS

HAVe YOu eVeR HAD A neW eMPLOYee WHO JuST DOeSn’T SeeM TO FIT In? In THe ReCRuITMenT PROCeSS, THe POTenTIAL eMPLOYee MAY HAVe TOLD YOu ALL THe THInGS YOu WAnT TO HeAR; THeY ARe ALWAYS PunCTuAL, ReLIABLe, HARDWORKInG AnD THeY GeT ALOnG eASILY WITH MOST PeOPLe.

Within a couple of weeks of that employee starting you see a different person. On a number of occasions your new employee has been showing up to work late without any good reason, and they have had heated arguments with their supervisor or team members about the best way to do things. Whilst they are a hard worker, you are concerned that this person is going to be ‘difficult’ to manage, and there is a good chance that they probably will not fit in with what the business wants to achieve in the long term.

What should you do now?

Firstly, here are some of the legal requirements you need to consider before taking action.

What is a probation period?

It is considered a trial period where the employer and employee assess whether the employment arrangement is going to work in the long term. The length of time required for a probation period will be specified in the Contract of employment or Industrial Instrument, such as an Award or enterprise Agreement; however, this is usually between three to six months. In general, employers use this period to assess an employee’s ability to do the job, his or her skills, standards, behaviours and cultural fit. On the flip side, an employee will be assessing you as an employer, what the work environment is like, whether they get along with their new team members, the support they receive from their manager, how the company treats its customers etc. The employer or employee will generally be able to end the employment relationship, by providing a period of notice that is less than what is required following the completion of the probation period.

Legally how does this work?

employers are protected under the Fair Work Act 2009 from employees claiming unfair dismissal, when the employee has worked for his or her employer for less than the minimum employment period. The minimum employment period is defined in the Fair Work Act as:  six months for employers who are not considered to be a small business employer; or  twelve months for employers who have less than fifteen employees and are considered a small business employer. (note that this protection does not apply to sole traders and partnerships in WA who fall under the WA State system). It is important to note that if you are intending to terminate an employee’s employment during his or her probation period, you must provide them with the appropriate period of notice before the six or twelve month minimum employment period expires. The Fair Work Act requires that the employer or employee is required to give the other party one weeks’ notice prior to terminating the employment arrangement.

Does this mean that an employer can terminate an employee for any reason during the Minimum Employment Period?

In short, the answer is no.

All relevant employment legislation such as equal employment Opportunity, AntiDiscrimination and general protection laws under the Fair Work Act during this period apply. For example, you cannot make a decision to dismiss an employee based on his or her gender, race or disability, or because they have exercised a workplace right such as raising a complaint relating to their employment or having to take sick leave.

The employer should also consider whether the decision to terminate the employment relationship could be in breach of the employment contract.

Therefore, it is important for the employer to be able to demonstrate that there is a lawful reason for the dismissal.

Ok, so with the legal stuff covered, here are the main points on what should be considered when taking action to address your concerns about a new employee.

1. Don’t wait to take action

You do not need to wait until the end of the probation period to discuss any concerns you may have about a new employee who is not meeting the performance or behavioural expectations.

Depending on your concerns, and whether it is likely that these can be resolved, you should not hesitate to make a decision to dismiss an employee well before the probation period expires.

2. Make sure the employee understands why there is an issue

As mentioned previously, it is important for the employer to be able to demonstrate that there is a lawful reason for dismissing an employee. A best practice approach to ensuring this occurs, is to do the following:  Raise any concerns with the employee as they occur. Do not save a number of issues up to discuss at a later date.  Have a meeting with the employee to discuss your concerns.  Ask the employee if there is anything going on that you are not aware of.  Allow the employee to respond to the specific concerns you have raised.  Be specific on what actions the employee needs to take to resolve these concerns.  Indicate to the employee what the potential outcome could be if the concerns are not resolved, e.g. terminating his or her employment.

Nyssa Starr

Human Resources Manager ECA WA www. neca.asn.au/wa

3. Is an extension an option?

It is, however you need to consider whether this is simply delaying a decision which is unavoidable and if this is fair on the employee. You should also consider the appropriate length of time required for any concerns to be resolved, if this is likely to happen and whether this will fall outside the minimum employment period of six or twelve months.

naturally as employers, we all want to see our employees succeed and grow. Having to implement an action such as dismissing an employee during his or her probation period, should be an exception to the rule. When it does happen, it can be costly to your company’s reputation. However, what is more costly in terms of productivity and time-consuming to manage, is having a permanent employee who does not ‘fit in’.

Disclaimer: This summary is a guide only and is not legal advice.