Aug 15, 2016
Posted in: workplace
By Jim Edmondson
Probation period for new employees is a valuable tool for employers as it allows for a review of the suitability of the new employee early on. It also offers the new employee an opportunity to better understand the expectations and requirements of the new position. Many employers and employees mistakenly assume that there are set standards around probation length and what is required at beginning or to terminate.
Opinions among employers, human resource professionals and certainly organized labour, are often mixed as to whether or not it is necessary to have probation periods for new employees. From the employer and HR’s perspective, a probationary period lets an employer decide if the employee is a good fit for the organization prior to investing significant resources and incurring severance liability. On the other hand, employees sometimes assume that once hired there is very little the employer can do without incurring penalty (severance). Usually, misunderstandings about what an employer can and cannot do vis-á-vis probation periods are at the root of these problems. Below, I explore some of those mistaken assumptions, de-bunking the myths!
Myth 1: A probation period is an implied term of all employment contracts.
Fact: Although some previous court decisions held that a probation period was implied, courts are much less willing to agree that a probationary period is part of the employment contract terms unless the employer clearly explained before the employee was hired that a probation period was required. This is what GDI does with its new hires. We want new employees to be fully informed at onset giving them a much higher success rate.
Myth 2: If an employee is terminated within six months after being hired, the employee is not entitled to notice or pay in lieu of notice (i.e. severance).
Fact: While the Saskatchewan Employment Standards Act does not require an employer to provide notice or pay in lieu of notice if an employee is terminated within three months after date of hire, that employee may be entitled to severance under common law unless an employment contract exists which explicitly limits severance if terminated during the probation period.
Myth 3: Probation periods are always six months.
Fact: While three months is frequently the probation duration chosen by employers, it can be any period an employer deems necessary to fairly evaluate whether the employee is suitable for the position and organization. The Collective Bargaining Agreement between GDI and SGEU, and GDI Policy contain explicit language regarding probation and have set the probationary period as six months.
Myth 4: An employer is not required to inform the employee of the reasons for the termination during the probation period.
Fact: All employers owe an obligation of good faith in the way that employees are terminated. The fact that an employee is on probation does not relieve an employer from the obligation to provide reasonable notice in the event that the employee is dismissed for reasons unrelated to the employee’s shortcomings, for cause. That is, employers are required to inform the employee of the reasons for the termination. Further, some courts have also held that employers are expected to let employees know of any performance issues during the probation period so employees have an opportunity to correct any deficiencies before the end of the probation. This is the reason that GDI conducts performance reviews on probationary employees at four months to enable them to rectify any shortcomings prior to the conclusion of probation.
Myth 5: An employer can terminate an employee for any reason during a probation period.
Fact: If a probationary period is established and an employer wishes to terminate the employee during this period, the reasons for the termination must be related to the employee’s qualifications and suitability for the position. Usually, an unexpected lack of work or financial problems is not a valid reason to terminate an employee using the probation period termination provisions. If terminated, the notice period set out in legislation would apply.
Myth 6: An employer can unilaterally extend the probation period.
Fact: Just as an employer cannot unilaterally change material terms of an employee’s contract, it cannot extend a probationary period without the employee’s agreement and fresh consideration. Our CBA, in Article 11.1.7, allows for extension of the probation period with adequate rationale, notice and agreement from SGEU.
Myth 7: Employers do not require cause to terminate during probation.
Fact: Generally, the standard required to dismiss a probationary employee for cause are lower than that required to terminate a non-probationary employee. The courts have ruled numerous times that an incident that may not constitute just cause for regular employees may constitute cause for dismissal of a probationary employee. Challenge for the courts has been that case law has not revealed a consistent test for determination of whether cause exists.
The prevailing view among HR professionals is that an employer has the right to dismiss a probationary employee as long as the decision is made for a legitimate work-related reason; is in good faith, and the employee is made aware of the standard expectations of continued employment. GDI, in conjunction with SGEU, has implemented safeguards into our probation system that protects all the parties involved and allows its employees to thrive.