The new Government has reinstated 90-day trials for all employers, so we asked Patrick Anderson, Senior Associate from Cooney Lees Morgan, for a reminder on key tips and pitfalls that employers should avoid:
The change in Government unexpectedly saw legislation passed under urgency which enables businesses with over 20 employees to include a 90-day trial period in a new employee’s employment agreement. Previously, only businesses with 19 or fewer employees were able to include a 90-day trial period in a new employee’s employment agreement.
Trial periods are of course not a new phenomenon, but the removal of the “19 or fewer employees” restriction serves as an opportunity to remind employers of a few issues that should be considered to ensure any trial period in operation is valid.
The Effect of a 90 Day Trial Period
The effect of a 90 day trial period has not changed under the new legislation except it now extends to all employers. While an employee who is dismissed pursuant to a trial period cannot bring a personal grievance for unjustifiable dismissal, it is important to remember that they could still raise a personal grievance on other grounds, e.g. discrimination or harassment.
Trial Period Provisions
An employee must be presented with, and sign, a copy of an employment agreement (containing the trial provision) before they commence working for the employer. That is because an employment agreement can only contain a trial provision if the employee has not previously worked for the employer. Under a valid trial period, an employee can be dismissed before, at, or after the end of the trial period. The employer only needs to give the required notice (specified in the employment agreement) before the end of the trial period. This can usually be paid in lieu (if allowed for by the agreement).
Rights and Obligations of an Employer
Employees who are in their 90 day trial period are to be treated no differently from an employee whose employment agreement does not contain a trial period provision. That said, an employer is generally under no obligation to provide employees access to relevant information about their decision to terminate the employment, nor do they have to offer the employee an opportunity to comment on the information. In addition to this, an employer does not need to supply a statement of reasons for dismissal to an employee being dismissed under a trial period provision, though it can be good practice to give an employee feedback if they are being terminated under the trial period.
A surprising number of cases concerning the validity of trial periods have come before the Authority and Employment Court. It can be an expensive mistake for an employer to make if they fail to ensure they are implementing a valid trial period, or unwittingly take action in reliance upon an invalid one. Having a considered process in place when implementing a trial period is a safe way to mitigate the risk of trouble, as is a regular review of employment agreement templates.
For further information, or if you require assistance with updating employment agreements to include a 90-day trial period for future employees, please click here to contact our Employment Law specialist, Patrick Anderson.
