If a strong recruitment process is your primary defence for hiring the correct employees for your business, the probationary period could be seen as your final safety net to ensure they are a good fit. It is your chance to look at them in-situ, ensure they are up to the job and that they work well with others.
Probation periods currently do not have legal standing; and while the current two-year qualification rule for full employment rights remains, you can take a reasonable approach as an employer. That is not to say we wouldn’t advise following a best practice, however.
But when the Employment Rights Bill is enacted, there is likely to be a far more rigid way of handling a probation period. We’ll take a look at that later in this blog.
What can go wrong?
An example of an ineffective probation period will be one riddled with poor communication (does the new hire even know they are on probation?), a lack of oversight and review meetings, unarticulated goals and even no recognised ending to the probation.
Unless they are an excellent self-starter you can imagine what this leads to: they will muddle along (maybe happily or unhappily), you may have a vague sense that they are not settling as you would wish, you’ll lack the record-keeping to take action with confidence…
Outcomes may include being stuck with someone you don’t want, making a disputed dismissal (time-consuming and dangerous for you if they are able to tie it to the Equality Act), or losing a good employee who felt they weren’t managed well enough at the start.
What is good practice for a probationary period?
A good probationary period will give structure to a new hire’s start with you. Let them know how long it will last, it should be in their contract – three months is the norm, and you can retain an option to extend it if you are still not sure. You really should know after one extension though.
Set them goals or performance levels you want to be seeing come the end of the period. Crucially, don’t just leave them to it and have one make-or-break meeting at the end to decide. Ensure regular check-ins are scheduled so you can track performance and advise them on how they are doing, what (if anything) they need to improve.
Hopefully, after three months they are on track and you can let them know they have passed the probationary period. If it goes the other way though, and you are not minded to allow them an extension, then you should terminate their employment. Explain that they have failed their probationary period and remember in their final pay to include any accrued but not taken holiday as well as their notice period. If you fail to do this the employee can make a tribunal claim for unlawful deduction from wages.
What about the Employment Rights Bill?
One of the main headlines of the Employment Rights Bill is the Labour Government’s desire to make full employment rights a day one entitlement. This adds considerable risk to employing people, not least because of its impact on the rather woolly probationary set up we are accustomed to.
To counter this, the Bill will formally recognise probationary periods, giving you a little breathing space to make an early dismissal should someone not be as good as you thought whilst recruiting. However, what was once good practice will become essential if you are to make a dismissal, with a real emphasis on transparency and record keeping.
You will need to:
- Show good transparency as to the terms of the probation period.
- Carry out regular performance reviews with constructive feedback and the opportunity to address issues.
- Offer a right of appeal where a probationary dismissal is made.
- Protect against unfair dismissal by making records to justify your decision.
- Follow clear processes including on how decisions are made and communicated and what an employee can do.
What to do next
If you already run a structured probation period when you employ people, you are halfway there. There will be a few compliance points to address. If much of this is new to you, there will be a lot of work to do. In either case, please reach out to us and we can help you get set up.
