If you are onboarding a new employee, should you put them on a 3, 6 or 12 month probationary period?

Hi there, my name is Andrew Koleda from On Demand HR and this is a common question that we get asked when drafting a new employment contract as part of their membership.

From our perspective, our general advice is that we should take our guidance from The Fair Work Act 2009 and the minimum employment periods relating to Unfair Dismissal to make an assessment of the length of probationary period we specify in our employment contracts.

Section 382 (a) of the Act states that a person is protected from Unfair Dismissal providing that they have been employed for the minimum period.

Section 383 defines the minimum period of employment to qualify for unfair dismissal as 12 months in the case of a small business with less than 15 employees and 6 months for larger businesses with more than 15 employees.

So in effect, regardless of what clauses you put in your employment contracts regarding the length of probation period you will not have to defend an unfair dismissal claim until either 6 or 12 months depending on the size of the business.

We struggle to understand why a business would choose to include a probationary clause that is shorter or longer than the timeframe that is covered under the Fair Work Act which the vast majority of businesses and employees are covered by.

The purposes of a probationary period is to prevent employee claims, and shorter periods of probation indicate to an employee they may be eligible to make a claim. And there is cost in defending these even though the claim may not be eligible to run.

If you have a question regarding probationary periods or your business is facing any other HR or Workplace Relations challenge, why not schedule a free HR consultation and written strategic action plan by visiting ondemandhr.com.au/advice

Thanks very much and looking forward to seeing you all in the next update.