Resources: Blogs

The probation myth

Blogs
|

Probation and the “minimum employment period” in the Fair Work Act 2009 (Cth)

There is a common misconception that probationary periods allow an employer to dismiss an employee for any reason (or for no reason at all) prior to the confirmation of their employment. This is not necessarily the case and, in fact, there is no statutory basis that entitles an employer and an employee to a probationary period.

There is a common misconception that probationary periods allow an employer to dismiss an employee for any reason (or for no reason at all) prior to the confirmation of their employment. This is not necessarily the case and, in fact, there is no statutory basis that entitles an employer and an employee to a probationary period.

The concept of a probationary period is largely derived from the provisions of the Fair Work Act 2009 (Cth) (FW Act) relating to minimum employment periods. Under the FW Act, an employee is only protected from unfair dismissal if, amongst other things, they have completed the minimum employment period.

The minimum employment period depends on the size of the employer’s business – it is twelve months for small business employers (i.e. employers who had less than 15 employees at the time of the dismissal) and six months for all other employers.

The minimum employment period applies to an employee’s employment irrespective of any contractual provisions setting out a probationary period. This can become an issue when an employee’s probationary period extends beyond the minimum employment period, as was the case in Werner v St Michael’s Association [2020] FWC 2896.

The employee in this matter was a chef and food safety trainer who commenced employment with the employer in March 2018. That employment was subject to a probation period for six months. During this period, the employee underwent three performance reviews where issues with her performance were raised.

At the end of the six-month probation period in September 2018, the employer extended the probation period for a further three months, and placed the employee on Performance Improvement Plans. At the commencement of the PIPs, the employee was only meeting expectations in one out of ten criteria. By November 2018, the employee was meeting expectations in seven of the criteria, and partially meeting expectations in the remaining three criteria.

At the end of the extended probation period, the employer extended it again for a further two weeks. At the conclusion of this further extended probation period, the employer held a Probation Review Committee meeting. During that meeting, it was determined that it was more probable than not that the employee would be unable to demonstrate appropriate levels of efficiency or responsibility in her role, and accordingly her employment was terminated.

The employee commenced unfair dismissal proceedings in the Fair Work Commission (FWC) alleging that her dismissal was unfair because she was satisfactorily fulfilling the requirements of her position and there was no valid reason to terminate her employment.

The employer argued that the employee had not demonstrated an ability to fulfil the requirements of her position and it was appropriate to terminate her employment while she was still in probation.

The FWC found that it appeared the employer had relied on incorrect advice it had received, which was that the employee was not protected from unfair dismissal during her probation period. The FWC noted:

“It can be seen that the Respondent though (sic) it had an unfettered right to terminate the Applicant’s employment if she had not satisfactorily (in the Respondents (sic) eyes) completed probation. As indicated that was wrong.” [at (19)]

The FWC further found on the evidence that the employee had made significant improvements in her role and was meeting expectations in respect of most areas by the time of her dismissal. It also noted that two of the employee’s managers believed that she had made sufficient improvement to warrant the continuation of her employment, but that they changed their minds at the final meeting to support their managers. Accordingly, there was no valid reason for the employee’s dismissal.

Finally, the FWC found that the employee was denied procedural fairness because she was not notified of the reason for her dismissal, was not provided an opportunity to respond, or given any prior warning about her performance and that it could lead to the termination of her employment.

The FWC therefore found that the employee was unfairly dismissed and awarded compensation to the employee in the amount of $8,788.64.

Lessons for employers

The minimum employment period set out in the FW Act will apply to an employee and employer irrespective of any contractual provisions relating to probationary periods. This becomes particularly important if an employer wishes to extend an employee’s probation beyond the minimum employment period.

Employers should also be mindful that employees who are dismissed prior to the completion of the minimum employment period are still able to make claims (other than unfair dismissal) in relation to their employment.

Information provided in this blog is not legal advice and should not be relied upon as such. Workplace Law does not accept liability for any loss or damage arising from reliance on the content of this blog, or from links on this website to any external website. Where applicable, liability is limited by a scheme approved under Professional Standards Legislation.

Similar articles

Employer went “above and beyond” to accommodate employee’s flexible work arrangement

You just got slapped

One of the effects of the amendments to the Fair Work Act 2009 (Cth) (FW Act) which came into effect on 6 June 2023 is that employers now have greater obligations when responding to requests for flexible working arrangements made under s 65 of the FW Act.

Read more...

Protecting Worker Entitlements - Further changes introduced to the Fair Work Act 2009 (Cth)

On 22 June 2023, the Federal Government passed the Fair Work Legislation Amendment (Protecting Worker Entitlements) Act 2023 (Cth). The Amendment Act introduces a number of changes to the Fair Work Act 2009 (Cth) aimed at protecting worker entitlements, promoting gender equality and delivering reforms to improve fairness in the workplace relations system.

Read more...

Fair Work Act Amendments - Action plan for employers

Following the Federal Government’s recent passage of the Fair Work Amendment (Secure Jobs, Better Pay) Bill 2022, it is essential that employers are informed and prepared about the changes due to be made to the Fair Work Act 2009 (Cth), many of which will be in place before the end of the year.

Read more...

FWO secures penalties against bar operator and external accounting firm

Closing time

The Fair Work Act 2009 (Cth) requires employers to keep certain employee records for a period of 7 years. These records are necessary to ensure that employees have been paid their minimum entitlements should an underpayment claim be made.

Read more...

Employer found liable for workers compensation despite worker’s unreasonable perceptions

Fact or fiction

A recent decision of the New South Wales Personal Injury Commission serves as a reminder of the differing standards of proof when determining liability for claims of bullying and/or harassment under workers compensation laws and the Fair Work Act 2009 (Cth).

Read more...

Commission finds employee’s flexible working request to work entirely from home was not reasonable

The worst has now passed

One of the many changes to the Fair Work Act 2009 (Cth) introduced this year include the Fair Work Commission’s new powers to deal with disputes relating to requests for flexible working arrangements.

Read more...

Let's talk

please contact our directors to discuss how ouR expertise can help your business.

We're here to help

Contact Us
Let Workplace Law become your partner in Workplace Relations.

Sign up to receive the latest industry updates with commentary from the Workplace Law team direct to your inbox.