Trial Periods: Getting the Process Right

Key Points About Trial Periods

Trial period provisions are valuable; however, employers must be aware of the legal requirements and common pitfalls that can invalidate their use.

Some key points in the use of trial periods include:

• During the interview process the employer must make clear that any offer of employment would be subject to a trial period of 90 days

• All documentation relating to a job offer must include the requirement for the trial period including covering letters and email correspondence

• The trial period runs for up to 90 calendar days from the commencement of employment

• To ensure the validity of a trial period, the employment agreement containing the trial period provisions must be signed at least one day before the employee starts work

• If the decision to terminate employment is made, apply the 90-day trial period provisions, not an offer of resignation

• If the employee is terminated during the trial period, the employer must comply with the terms of the notice period

• While an employer may not be legally required to justify the dismissal, good faith still applies. We recommend:

  • provide feedback during the trial period,

  • raise concerns as they arise,

  • explain the reasons for termination, and

  • treat the employee with dignity and respect

Recent Case Law

In Jansen v BDS Chartered Accountants Limited, the Employment Relations Authority considered the dismissal of an administrator employed under 90-day trial period provisions.

After concerns emerged regarding workload, onboarding and performance, the employer decided to end the employment relationship during the trial period and the employee was advised accordingly. The employee was offered the option of resigning instead, with the suggestion that resignation may assist her future employment prospects.

The employee later resigned by email.

The Authority found that although the employee had technically resigned, the resignation occurred in circumstances amounting to constructive dismissal because she had effectively been presented with a choice between resigning or being dismissed under the 90-day trial period. 

The Authority also found the employer could not rely on the protections usually available under the 90-day trial period provisions because the employment agreement required one week’s written notice, and written notice had not been provided.

The employee was awarded $7,000 compensation for hurt and humiliation.

Sylvia Wood

Director