What you need to know about trial and probation periods

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What you need to know about trial and probation periods

Including a trial period in your employment agreements can protect you from hiring an employee who might not have the right skills or attitude. However, it is important to use them correctly.

Discover what you need to know about trial and probation periods.

Trial periods

What you need to know

You have to:

include the trial period in the employment agreement (it can be up to 90 days long) and have both parties sign it before they start work – otherwise it has no legal grounds if it’s contested
give the employee all the benefits of a permanent staff member, like holidays and sick leave, while they’re on trial.

You can’t:

put an existing employee on a trial period – they’re for new employees only
extend the trial once it ends – the employee becomes permanent unless you dismiss them before the end of the trial period.

If you decide to dismiss the employee within the trial period:

they can’t raise a personal grievance against you on the grounds of unfair dismissal
they can still raise a personal grievance if they think you’ve discriminated against them or harassed them
their notice period still applies.

Case study

Testing times

Mark’s plumbing business is a growing venture and is now so busy he needs to hire additional staff. He hires two qualified plumbers Jim and Thomas, including a 90-day trial period clause in their employment agreements.

Find out what you know about hiring and managing people.

A trial period is only valid if included in a written employment agreement.

Use our new Employment Agreement Builder(external link) to work through the necessary steps to create a proper agreement.

Probation periods

A probation period is different from a trial period.

A probation period is:

for an agreed length of time
at the start of employment
so an employee new to the job can demonstrate their skills (they can be an existing employee who has applied for a new job with their employer), and
so you can assess them.

What you need to know

You have to:

include the probation period in the employee’s employment agreement before they start work
give the employee all the benefits of a permanent staff member, like holidays and sick leave, while they’re on probation.

You can:

use a probation period no matter how many employees you have.

You can’t:

use a probation period to get work done for free – you have to pay a full wage while the employee is on probation.

If you decide to dismiss the employee during the probation period:

they can still raise a personal grievance for unfair dismissal
you must follow a fair process
you’ll need to show there was a valid reason for dismissal.

If the reason is connected to the probation, it must be because the employee isn’t performing to the expected standard in the agreed time. You must have given support and training for this to be a valid reason.

Don't use a fixed-term contract in place of a trial or probation.

This is prohibited. To hire an employee on a fixed-term contract, there must be a genuine reason for the job to only last a certain period of time — like seasonal work or cover for parental leave. Read more about fixed-term contracts.

If you run into problems — mediation

If there’s a problem during a trial or probation period, you and your employee can get help from Employment Mediation Services. Their service is free, private and confidential. They can help you: