A probationary period is a requirement in employment contracts that allows Organisations to review new Employees’ suitability throughout the early stages of their employment. It is a trial period during which both parties can assess the working relationship and allows the Employer to determine whether the Employee is a good fit for the role and the organisation. Employers should be aware of the purpose, duration, and rights of Employees and ensure they follow best practice.

What is the purpose of a Probationary Period?

The probationary period serves several purposes for both Employers and Employees. For Employers, it provides an opportunity to assess an Employee’s skills, competencies, and overall performance in real work conditions. It allows Employers to evaluate the Employee’s suitability for the role, their ability to meet the required standards, and their compatibility with company culture. For Employees, the probationary period offers a chance to familiarise themselves with the job, understand expectations, and determine if the role aligns with their career goals. In doing so both Employers and Employees should benefit from a probationary phase.

Duration of the Probationary Period

The European Union (Transparent and Predictable Working Conditions) Regulations 2022 came into force on 16 December 2022 and introduced significant changes to the law on contracts of employment and working conditions for Employees. Specifically, there are now new regulations regarding the length of probationary periods in contracts of employment for Employees.

 The new regulations state that probation periods can be no longer than 6 months. In exceptional circumstances, an Employee’s probation period can be extended for up to a further 6 months (up to a maximum of 12 months in total). An extended probation period occurs when it is deemed in the Employees interest or when an Employee has been on extended leave, such as sick leave, during their probation. It can also be extended where it is justified by the nature of the work, for example, public service employment.

This amendment of the maximum probationary period considerably impacts how Organisations deal with probationary periods in their employment contracts and in practice. As an Employer, you must be cognisant of all your Employee’s rights during this probationary period and ensure all obligations are adhered to. It is relatively commonplace for some Organisations to take a relaxed approach to managing probationary periods, knowing that they can simply extend the time period if they realise after six months that their employee may not be suitable. The change in employment law means Employers can no longer take this laissez faire approach without risk. Our experts in Adare HRM would therefore highly recommend that Employers reassess their Employee’s contracts and their probationary practices in light of this new regulation.

Employer’s Rights during the Probationary Period

 As an Employer, if you dismiss an Employee while on probation or undergoing training, please note that the Unfair Dismissals Acts 1997–2015 will not apply, once:

• The contract of employment is in writing and
• The period of employment or training lasts one year or less, as specified in the contract.                                               However, the Unfair Dismissals Acts will apply if you are dismissed due to:
• Trade union membership or activity
• Pregnancy-related matters
• Entitlements under maternity protection, parental leave, adoptive leave, parent’s leave, paternity leave, force majeure leave, or carer’s leave legislation.

Employee’s Rights if dismissed during Probationary Period

If an Employer dismisses an Employee during a probation period due to misconduct, the Employee has a right to ‘natural justice’, which means due process and fair procedures. However, this right does not generally apply to dismissal by an Employer for poor performance, particularly where a contract expressly allows for dismissal for poor performance during probation. While an Employer may not have to go through all stages of the disciplinary process to dismiss for underperformance, they will still be obliged to go through a shortened version, relevant to the context, to ensure the concerns have been shared with the employee, they have been supported to improve and given reasonable time to demonstrate the required performance.

 An Employee may be able to take a claim for ‘wrongful dismissal’ during their probation period if they have less than 12 months of service. Wrongful dismissal happens when an Employer does not meet an implied or an express term in the Employees contract of employment or does not give adequate notice. An Employer in this case could be sued for breach of contract in the civil courts.

If an Employee believes they have been dismissed unfairly based on the grounds of discrimination, they can make a claim under the Employment Equality Act 1998 – 2015. It might be considered a discriminatory dismissal by the Equality Tribunal unless the Organisation can prove the dismissal was based on a performance and has evidence to support their claim.

An Employee with less than 12months of service can claim they have been unfairly dismissed under the Industrial Relations Act 2015 as amended. The decision is not legally binding, however certain Organisations would comply with these recommendations particularly unionised organised, beneficiaries of State funding etc. The decision provides the Employee with recognition from the court that they were unfairly dismissed should any future Organisation enquire about their previous employment.

What is the difference between Expressed and Implied Terms?

Expressed Terms

‘Express terms of employment’ are agreed between the Employee and the Employer. They are either:

• Verbally agreed.
• Set out, in writing, in your contract (or in other documents which form part of your contract, such as a staff handbook) Express terms generally include pay, hours of work, a notice period, and so on. Implied terms ‘Implied terms of employment’ are terms that are not verbally agreed to or set out in writing but are still legally binding.

Implied terms can come from many sources, such as:

• Legislation and case law (for example, it is common law that both Employer and Employee have a duty of care towards each other and other Employees)
• Custom and practice within the workplace (for example, a particular rate of overtime pay for Employees)
• An obvious consequence of what is stated in the contract (for example, that the Employee will do their work in a competent and careful manner)

Probationary Period Best Practices for Employers:

To ensure a successful probationary period, Employers should consider the following best practices:

• Clearly define and explain the duration and terms of the probationary period in the employment contract.
• Provide a comprehensive induction process to familiarise Employees with their role, responsibilities, company policies, and company culture.
• Establish clear performance expectations and communicate them effectively.
• Conduct regular probation review meetings and provide constructive guidance and support.
• Document review notes and send follow-up documents to the Employee detailing what was discussed.
• Offer training and development opportunities to help Employees meet performance standards.

End of Probationary Period – Termination of Contract

If you decide to terminate an Employee’s contract as they have failed to meet the requisite standards, then the next steps are to invite the Employee to a final probation review meeting to inform the Employee of the outcome. It is strongly advisable that the invitation letter should advise the Employee of the potential outcome of the review so that this does not come as a surprise to them.

 The Employer should also provide written notice and give the Employee an opportunity to respond or appeal the decision. Employers should document the reasons for termination and maintain a record of the entire process to demonstrate fairness and compliance with legal requirements. The Employee should also receive documentation outlining their notice period, a reference for future employment, and a statement that any accrual leave will be paid.

The Employee will be entitled to one week’s notice. If the probationary period for justifiable reasons goes past 12 months, then they will be entitled to two weeks’ notice. If the employment contract allows for a greater notice period, this will have to be honoured.

 Managing probationary periods requires a proactive and fair approach from Employers. By setting clear expectations, offering support and training, implementing effective performance management processes, and adhering to legal obligations, Employers can successfully address underperformance and manage probationary Employees successfully.

If you require advice or guidance regarding the legalities surrounding an Employee’s Probationary Period or require support in the development of Best Practices or your Employee Policy Handbooks, please contact any of the Adare Human Resource Management team at (01) 561 3594 or email info@adarehrm.ie for more information on how we can help and support your Business under our Partnership Programme