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There are differences between the two concepts and they should be treated separately by employers. One relates to suitability of an employee, the other relates to whether a terminated employee can make an unfair dismissal claim.

What is a probationary period?

Probationary periods are not derived from the Fair Work Act 2009 but are a fixed term period that commences at the start of a successful candidates’ employment. Such a term should be clearly detailed within a contract of employment and utilised for the purposes of determining the suitability of the new employee for ongoing employment. If the employee does not work out or fit in they are notified of being unsuccessful and their employment is not continued. If the probationary period has expired then the employer cannot seek to rely on the probationary period for terminating an employee’s employment. Conversely, if they do work out then they should be notified of their ongoing employment.

Hardnosed legal approaches aside, the probation period gives the employer some time to hold meetings with the new employee to discuss problems, assess progress, set expectations, allows for early intervention. Such interactions help supervisors and managers determine the ‘fit’ within the organisation.

Utilising a probationary period will also mean the explanation for the termination of employment remains purely “you have been unsuccessful during your probationary period” rather than having to go into the minutiae about the employees conduct, poor attitude and behaviour. It allows an employer to remain deliberately vague on issues that may otherwise be responded to with claims of discrimination or bullying by an ex-employee. These days we treat it as a safeguard in the hiring process and always recommend interleaving a six months probationary period into every contract of employment.

So, what is a qualifying period?

From a legislative and litigious perspective, some view the qualifying period as having taken over from probation periods. But that is not exactly the case.  If an employee is terminated, the Fair Work Act 2009 sets down provisions that an employee must meet before they can undertake an unfair dismissal claim in the Fair Work Commission. Effectively, the employee must have completed six months employment, or twelve months if the employee works in a ‘small business employer’ (employs fewer than 15 employees) to make that particular claim.

This clause doesn’t stop the employee making the unfair dismissal claim, but does put in place a statutorily derived jurisdictional impediment that, if not hurdled, will not allow their application to progress in the Fair Work Commission. It does not stop an employee taking some other form of claim, such as an adverse action claim, against the employer.

Use it or lose it

Making the wrong decision when hiring a new employee happens from time to time. However, once an employee has completed the legislatively derived qualifying period an employer completely enters the peaks and troughs of employment relationships. Further, if you can’t rely on the ‘being unsuccessful during the probationary period’ cover all when terminating an employee, employers are going to have to have a very clear and defensible basis for explaining the termination of employment. We recommend employers utilise whatever they have available to ensure they have hired the candidate with the right stuff.

Author: Charles Watson, Senior HR Advisor, Better HR

Published: 24 August 2017

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