Getting it right! You can’t rely on the probation period to terminate poorly selected employees

There are many reasons why businesses of all sizes should invest time and resources into formulating good recruitment practices. Too often, we see management relying on a new employee’s probation period to work out if they are a suitable fit for the job. But this is a risky strategy that could backfire on you.

Why? Because there is a loophole which may leave you vulnerable to a wrongful dismissal claim – even if the employee was terminated during their probation period.

Probation periods aren’t standard

Most employment contracts provide a 3 or 6 month probation period. If there isn’t an employment contract and the business has less than 15 employees, the minimum probation period could be 6 or 12 months.

Within the probation period, either party can terminate the employment contract by providing a week’s notice.

No legal requirement to provide a reason

But here’s the problem, there is no legal requirement to provide a reason for dismissing an employee during their probation period. However, if you don’t specify the reason, the employee can fill in the gaps themselves.

If an employee believes they were dismissed for a reason that falls under the general protections provisions of the Fair Work Act, they can take action against their former employer. General protection provisions include actions such as coercion, discrimination or other adverse actions.

The onus of proof is on the employer

This means an employer has no legal obligation to provide a reason for terminating an employee during the probation period. However, if a reason isn’t specified at the time of the dismissal, the employer may face an unlawful termination claim.

Things to note

  1. Always check the minimum employment period under the Fair Work Act before terminating an employee during their probation period. If you aren’t sure, contact us.
  2. Give the employee a written termination letter which includes the reason for the termination – even though it’s not required. The reason doesn’t need to be detailed.
  3. Ensure you aren’t terminating the employee for a “prohibited reason”. Again, if you aren’t sure, talk to us.

Don’t make risky recruitment decisions because you are desperate for staff!

We understand it’s difficult to recruit good people at the moment but recruiting the wrong person can be an enormous drain on your time, energy and productivity. The wrong recruit can also damage customer relationships and the harmony of your current team.

So don’t rely on the probation period to make risky recruitment decisions and always ask us for advice before you terminate any employee. Better still, ask the End2end team for assistance in recruiting your next star employee. We offer human resources services for the entire life cycle of an employee – from initial recruitment to departure.

For help call 02 8977 4002