Dismissing an employee during probation can be a difficult decision for you as an employer. To add to the difficulty, there are some major misconceptions about the legalities of what you can do when it comes to probation.
Some of these misconceptions suggest you can unilaterally extend an employee’s probation; and potentially dismiss an employee during this extended probation without consequence.
The situation is, however, a little more complicated than that – and it’s critical that you are aware of what can and cannot be done in this regard.
So, when can an employee’s probation be extended? And when is this actually the right move?
Probation: an explainer
Probation is a contractual term which generally refers to a trial-period in which a new employee remains under evaluation while you decide on their long-term suitability for the role.
The length of a probation generally ranges from 3-6 months; though in some extraordinary cases, this can be up to 12 months.
During probation, you may choose to dismiss an employee without being liable for unfair dismissal claims – as long as you have a valid reason for doing so and have followed the correct procedures.
The length of probation is often guided by the Fair Work Act’s specified minimum employment period – the minimum amount of time a worker can be employed by a business before they have the ability to lodge an unfair dismissal claim.
For small businesses (those with fewer than 15 employees), the minimum employment period is 12 months. For all other businesses, the minimum employment period is 6 months.
If an employee is dismissed during their minimum employment period, they are unable to lodge an unfair dismissal claim.
Unfair dismissal claims and minimum employment periods
Despite the common usage of the term ‘probation, this concept is not actually addressed within the Fair Work Act and (as has been explained) probation often align with minimum employment period specified by the Fair Work Act. To reiterate, this period is 6 months, or 12 months for small businesses.
Once an employee’s minimum employment period has been completed, they are then able to lodge an unfair dismissal claim if they believe they have been dismissed unfairly – regardless of the length of any probation outlined in their employment agreement.
A case brought to the Fair Work Commission highlights the importance to your understanding of the differences between (and details of) probation and minimum employment periods.
In Werner v St Michael’s Association  FWC 2896, an employer extended a worker’s probation for an additional 3.5 months beyond employment agreement probation of 6-months.
On the final day of the probation, the worker’s employment was terminated – despite ain job performance during the probation extension.
While the employer believed the extended probation protected them from an unfair dismissal claim, this was not the case as the worker had been employed for more than 6-months.
Following an unfair dismissal claim from the worker in question, the Fair Work Commission ruled the worker had been unfairly dismissed and they were subsequently awarded $8,788.64 in compensation from the employer.
Can probation be extended?
So, if your employee is nearing the end of their probation and you’re still unsure about confirming their employment, can you extend their probation?
Well, this depends on several key factors.
While probation can be extended by employers under certain circumstances, this is dependent on whether or not such an option is explicitly outlined in the employee’s employment agreement.
If the employment agreement in question does not specify that probation may be extended, you cannot unilaterally do so.
Even if you can extend an employee’s probation, there are other factors which should be considered before any decision is made.
In particular, it is very important to remember that, even if probation is extended, this cannot supersede the rights of workers as outlined by the Fair Work Act’s minimum employment period.
For example, even if probation is extended beyond the initial six-months of employment, you may still be subject to an unfair dismissal claim if the employee is dismissed after the six-month minimum employment period has been exceeded.
Akyra’s key takeaways
- Employers should be cautious about extending probation, with the possible intention of dismissing an employee during the extension.
- Minimum employment periods outlined by the Fair Work Act mean that, after a specific period, workers are entitled to file unfair dismissal claims – regardless of any specified probation.
- The minimum employment period is 6-months where the business employees more than 15 people and 12-months where the business employees less than 15 people.
NEED MORE INFORMATION?
Akyra can help your business to assist and support all your questions and concerns related to employee probation. Please contact Akyra on 07 3204 8830 or book a free 30-minute consultation for an obligation-free conversation.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.
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https://www.axialawyers.com.au/terminating-an-employee-following-an-extended-probation-period-not-so-fast/, https://www.bdn.com.au/probation-what-rights-do-you-have-as-an-employee/, http://www5.austlii.edu.au/au/legis/cth/num_act/fwa2009114/s383.html, https://www.fairwork.gov.au/starting-employment/probation, https://www.austpayroll.com.au/the-probation-myth-probation-and-the-minimum-employment-period-in-the-fair-work-act-2009/