Hiring someone is a timely and expensive process – made only more burdensome when you realise several months down the line that they aren’t the right fit for your company or choose to resign.
No employer has the perfect recruitment process, which is what makes probation periods so important when taking on board a new employee.
Putting someone on probation is arguably similar to putting them through a trial period to see how they fare, but this does not mean you have no responsibilities to them.
The benefits of probation periods
When an employee joins your company knowing that they will be under intense scrutiny for a period of time, this is a sure-fire way of encouraging them to work hard and prove their worth, especially when the probation period is less than 6 months long.
Existing employees who perhaps need to improve their performance or are due to take up a new role may also benefit from a probation period, during which their progress should be monitored closely.
Some employers might choose to pay staff members slightly less during their probation, which not only motivates the employee to work harder in order to earn more money, but it also helps organisations to cut down on costs.
Having a structured probation period with frequent reviews and chances to communicate also ensures that expectations of both parties are well-managed. Employees should expect and listen to constructive criticism and employers should be giving feedback whenever possible.
The disadvantages of probation periods
All terms of the probation period must be set out in your employment contracts, including guidelines on when and how probation periods may be extended. If you do not inform an employee that their probation period has been extended, they have the right to believe they are now a full-time, permanent employee and therefore expect more from you.
A lack of communication can make probation periods very confusing for employees. We recommend that you ideally inform staff whether or not their probation has been successful at least one week before their probation period is due to finish.
Typically, an organisation’s formal disciplinary process does not apply to anyone on probation. It could be argued that this stops a probationer from getting a realistic experience in the workplace.
Your responsibilities to employees on probation
Employees are entitled to several statutory employment rights from the second they join a company – regardless of whether or not they are on probation.
These include the right to earn the minimum wage, holiday pay entitlement, maternity leave and working in accordance with the working time directive, just to name a few.
Other additional company benefits, such as private medical insurance and generous pension contributions can be reserved for when the employee has passed their probation.
If you feel an employee’s poor performance could be improved with specific training or mentoring, you can extend their probation period on a month-by-month by basis – but this must be set out in your employment contracts and made clear to the employee.
Dismissing an employee who is on a probation period
It’s an unfortunate fact that one-fifth of employees fail to make it past the probation stage. Nonetheless, the whole purpose of a probation period is to determine whether or not an individual suits your company well and how well they have taken on feedback or responded to training.
Maybe they simply do not possess the skills required, indicating that their interview was not entirely truthful. Maybe they have struggled significantly to fit in with colleagues, or have displayed poor timekeeping.
Whatever the reasoning might be, it’s still important that you follow the correct process when dismissing a probationer in order to avoid any kind of legal implications.
Avoiding legal implications
You should have made every effort to assist and guide the employee on the requirements of their new role and this includes showing them how to correct their mistakes.
Employees cannot claim for unfair dismissal unless they have been employed by you for a minimum of two years. However, employees dismissed during or after their probation can still seek action against you if it appears you have done so for discriminatory reasons.
For example, dismissal relating to an individual’s age, gender or religion would class as discrimination. Dismissal due to whistleblowing would also automatically be regarded as unfair.
Generally speaking, you should list all of the terms of probation periods in a separate clause in your employment contracts and be sure to abide by them. Little legal action tends to arise as a result of dismissing a probationer, just as long as you follow the terms you have set out in your own contracts.