Understanding Probationary Periods in Employment Contracts

Bringing someone new into your business is a big decision. You’re hoping they’ll settle in, do well, and become a great asset to your team. But what if things don’t quite work out? That’s where probationary periods come in – and when used properly, they can make managing new hires a whole lot smoother.

Whether you’re hiring your first employee or adding to a growing team, it’s worth knowing how probation works and how to get it right from the start. In this guide, we’ll walk you through what probationary periods are, what the law says, and how to manage them effectively – without the stress.

What Is a Probationary Period and Why Use One?

A probationary period is a set amount of time at the beginning of someone’s employment – usually three to six months – when both you and your new employee can see how things go. Think of it as a trial run.

It gives you time to check whether the person’s a good fit for the role and your company culture. And it gives them a chance to settle in, get to grips with the job, and see if it’s the right place for them too.

It’s not about setting anyone up to fail. Done well, a probation period helps everyone start off on the right foot – with support, regular feedback, and clear expectations.

What Does the Law Say About Probation Periods?

Although there’s no specific law saying you must include a probation period, it’s common practice in the UK – and if you do use one, there are some important legal bits to be aware of.

First off, even during probation, employees still have legal rights. That includes the right to:

• Be paid at least the National Minimum Wage
• Receive statutory holiday and sick pay
• Be enrolled in a pension (if they’re eligible)
• Work in a safe, fair environment

And while you can include a shorter notice period during probation, this must be clearly written into their contract from the start. Otherwise, standard notice rules will apply.

It’s also important to remember that while some protections – like the right to claim unfair dismissal – kick in after two years, others (such as protection from discrimination or whistleblowing retaliation) apply from day one.

So while probation gives you flexibility, it doesn’t mean you can bypass employment law. Fairness still matters – and so does how you manage things.

Setting People Up for Success

Probation shouldn’t feel like a test with a pass or fail at the end. It should be a period of support, where new employees feel guided, not judged.

Start with a proper induction. Let them know what the role involves, how success is measured, and who to go to for support. Set clear expectations – but don’t overwhelm them with too much, too soon.

Regular check-ins can make a world of difference. A quick weekly chat or monthly review gives you both the chance to talk about how things are going, raise any concerns, and agree on next steps.

It’s also a good idea to keep a record of these chats – not in a heavy-handed way, but just so you can look back and see progress, note any agreed actions, and stay consistent.

If something isn’t quite right, raise it early and constructively. Most people want to do well – they just need the right support.

What If Things Aren’t Working Out?

Sometimes, even with the best intentions and support, things don’t go to plan.

If an employee is making progress but needs more time, you might decide to extend their probation. This is absolutely fine – as long as their contract allows for it and you confirm the extension in writing. Be clear about how long the extension is for, what improvements are needed, and when the next review will be.

If it becomes clear that things aren’t going to work out, you may decide to end the employment. This can be a tough call, but if it’s handled fairly and with care, it doesn’t have to be unpleasant.

Make sure you follow the correct notice period, pay them for any unused holiday, and explain your reasons clearly. Keep things respectful – how you manage an exit can say just as much about your business as how you welcome people in.

Keeping Up With Legal Updates

While probation periods themselves haven’t changed much in law recently, there have been some updates you’ll want to be aware of.

For example, since 2020, employees must be given a written statement of terms on their first day – not after two months, as it used to be. This means probation clauses, notice periods, and any performance expectations need to be clearly written into the contract from the outset.

If it’s been a while since you reviewed your employment contracts, now might be a good time.

Need a Hand? That’s What We’re Here For

If you’re unsure how to manage probationary periods, or just want to make sure your contracts are legally sound, we can help.

At The HR Dept, we support small and medium-sized businesses with all things HR – from drafting employment contracts to helping managers run smooth and supportive probation reviews. We’ll work with you to create clear processes that protect your business and help your people succeed.

Whether you’re starting from scratch or just need to tighten things up, we’ll make sure everything is legally compliant, fair, and tailored to how you run your business.

Get in touch with your local HR Dept office today for friendly, expert advice that fits your business.