PROBATIONARY, QUALIFYING and MINIMUM EMPLOYMENT PERIODS

EMPLOYMENT STATUS

Having employed a person on a permanent basis and signed an employment contract, the employer is faced with the situation of whether that person will be suitable for their organisation. Likewise, the employee will assess whether they feel comfortable working with their new employer. A probationary period provides that mechanism whereby over a period of time (generally between 3 – 6 months depended upon the position in question) the parties assess their suitability to each other. Note, that a probationary period can be extended by agreement between the parties. However, extending the probationary period may affect the employee’s entitlements in connection with their service of employment. A probationary period does not apply to a casual employee.

While not specifically set out in legislation, a probationary period does/should exist in employment contracts. It can be provided for in enterprise agreements.

EMPLOYMENT ASSESSMENT PROCESSES

During the probationary period, a process should be in place to manage probation. This includes:

·       acknowledgement of a successful probation (in writing);

·       advisement of an unsuccessful probation (in writing);

·       development of performance check list;

·       regular employee meeting and feedback on progress during probationary period.

TERMINOLOGY and PERIOD of SERVICE

Under the Fair Work Act, the matter of a Probationary period seems, on the one hand, to be unnoticed. However, on the other hand, the phrase, minimum period of employment (s. 383 – Fair Work Act), provides a mechanism whereby a statutory reference identifies with a probationary period. The minimum period of employment sets out the period of service by which an employee can seek redress in the event of termination of employment, following which, the employee will still be entitled to any unused leave entitlements (the NES apply to an employee on probation).

In the case of a small business, an employee with more 12 months employment with their employer, can raise a claim of unfair dismissal if dismissed. For a larger employer, that period of employment is 6 months before the employee can claim unfair dismissal.

The term, probationary period, is likely to be understood by small business than that of a minimum period of employment, yet the effect is the same in its application.

The phrase, minimum period of employment, emerged from previous legislation recognising a “qualifying period”.

Disclaimer: Richard Krajewski’s articles are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication.