Trial periods were designed to give businesses the confidence to hire new staff, knowing that they wouldn’t face an expensive claim for unjustified dismissal if things went wrong fairly quickly.

However, a number of employers have found out the hard way that trial period clauses don’t always provide the protection they were expecting. 

In this article we discuss some of the things employers need to do to make sure that their trial clauses work. 

 

The courts have interpreted the law around trial period clauses stringently. The trial clauses will only be effective if the employer:

• strictly follows the terms of the legislation when first putting the clauses in place; and

• strictly follows the provisions of the clause, when dismissing. 

 

If the employer does not do this then the trial period clause will have no effect, and they will be exposed to a potentially large personal grievance claim.

 

 

Trial period clauses:

• Are usually for 90 days. They cannot be any longer.

• Can only be used for a “new employee” - meaning an employee who has not previously been employed by the employer. Trial periods are not automatic for new employees - they will only apply where there is a properly implemented clause. Most job offers we see don’t contain trial provisions, but many do, particularly where the employer is hiring relatively inexperienced staff.

• Must be contained in a written agreement that has been signed by both employee and employer before the employee starts work. This rule is usually applied rigidly. If the employee signs the agreement five minutes into their first day, they will not be a new employee, and the trial period will almost certainly have no effect.

• Cannot be included in a later written agreement if the employee has already been offered and accepted the job. If you want to include a trial period, make sure you do not offer the employee a job verbally before providing the written agreement (this is always good practice, whether or not you are including a trial period clause). Candidates should also be told as early as possible in the recruitment process that a trial provision will or may be included.

• Will only be effective where the employee has been given a real opportunity (and time) to take legal advice, and to discuss and bargain about the agreement. If an employee can show that they were simply presented with an agreement which was non negotiable, the trial period will be vulnerable to challenge.

• Must be strictly complied with, when dismissing the employee. For example, trial periods normally commence on the day the employee actually begins working. If the parties signed an employment agreement in advance but the employer then dismissed the employee before their actual start date (and therefore before the trial period actually starts), the trial clause will not apply, and the employee could well have a valid personal grievance.

• Do not prevent an employee bringing a personal grievance for discrimination, or some other form of disadvantage. Mutual obligations of good faith still apply, and employees dismissed during a trial period can still ask to go to mediation. 

 

An employee who is dismissed under a trial period does not have the right to be given written reasons for their dismissal. However, the Court has said that such an employee must be verbally told why they are being dismissed, if they ask (this is simply part of acting in good faith).

 

Probationary periods - what’s the difference?

Trial periods are not the same as “probationary periods” (which, confusingly, were sometimes called “trial periods” in the past). 

Probationary clauses are weaker than trial clauses. They put the employee on notice that their performance is being watched, and therefore make it easier for the employer to warn or dismiss. However the employer must still follow a fair process before doing so, and the employee can bring a legal claim challenging their dismissal if they don’t.

 

Seek advice

The law around trial periods is continuing to develop. Employers should ensure they are using a well drafted clause, and should seek specific advice to ensure they are implementing and using these clauses correctly.