Think you can Terminate a Person on a 90 Day Trial?

Below are important things to note when considering employing or terminating on a 90 day trial

1. Mutual agreement:

The 90 Day Trial Period is a voluntary arrangement which means that, in addition to other requirements, the employee has to freely agree with the employer for a trial period to be included in their employment agreement. It has to be set out in writing.  You can also choose not to include a 90 Day Trial Period in Employment Agreements.

2. The Employment Agreement:

- Must have the correct wording.

- Will not be valid if signed on the day the employee starts or thereafter.  It must be signed BEFORE they commence working for you.

- It must be the Employment Agreement that is signed, not an offer letter referring to the Employment Agreement.

3. Good Faith Obligations:

- Your duty of good faith still exists during a trial period. This includes an obligation to be communicative and responsive. As such, if you are experiencing concerns with the performance or behaviour of a new employee, ensure you are discussing these and are clear about your expectations. You must also communicate that their ongoing employment with you is in jeopardy.

4. Termination:

- You must give notice of dismissal to the employee before the end of the trial period (even if that dismissal does not actually happen until after the date on which the trial period ended). If you wait until the trial period has ended before dismissing the employee, the employee will be able to challenge the dismissal by bringing a Personal Grievance.

- A recent Employment Relations Authority case (which is being challenged in the Employment Court) also requires the notice period to be worked. You cannot pay in lieu of notice for a trial period termination. The notice period can extend beyond the 90 days, however the notice of termination must occur before the end of the 90 days.

5. Personal Grievance:

- An employee can raise a personal grievance on other grounds, such as discrimination or harassment or unjustified action by the employer.