Care required in terminating probationary periods

Przybylska v Modus Telecom Limited (Employment Appeal Tribunal – February 2007)

Miss Przybylska was employed on a three month probationary basis from 3 October 2005. During the probationary period her contract could be terminated at a week’s notice and Modus reserved the right to extend the probationary period (including the week’s notice provision) if it needed to make a further assessment of her performance.

The probationary period expired on 2 January 2006 but Miss Przybylska was absent on holiday at this time and Modus did not extend the probationary period before her holiday began. At the end of the January 2006 Miss Przybylska was dismissed because she had not, in the view of Modus, successfully completed the probationary period. As Miss Przybylska was only paid one week’s pay in lieu of notice she made a claim in the Employment Tribunal for breach of contract contending that she should have been paid three months notice after completion of the probationary period.

The Employment Tribunal rejected the claim by implying a term in the contract of employment that it was reasonable for the probationary period to continue until Miss Przybylska had received an indication as to whether she had successfully completed it or not. No notification of success or failure had been received by the time the probationary period was originally set to end and so it continued and any delay in assessing Miss Przybylska’s performance was reasonable.

On appeal the Employment Appeal Tribunal found that the term implied by the Employment Tribunal was inconsistent with the express terms of the contract of employment. The assessment was to take place during the probationary period and the fact that Miss Przybylska would be on holiday at its end should have been foreseen. Modus could have extended the probationary period, as allowed for under the contract, if it had not been able to complete the assessment before the holiday. They did not do this and it was not necessary to imply a term which automatically extended the probationary period.

The case has been remitted back to the same Employment Tribunal for an assessment of compensation. At first glance it would seem simple to assess the compensation; 3 months minus the week that was paid. However, there is a twist in this tale. The claim was for breach of contract and such claims are subject to the statutory dispute resolution procedures. In a case such as this the procedures will apply even if the employee has not completed one continuous year of service.

The problem for Miss Przybylska is that she did not appeal against her dismissal and therefore did not complete the statutory process and so the Employment Tribunal will have to consider deducting her award by between 10% to 50% as a consequence.

There is also a lesson to be learned by employers here. Not only should the terms relating to termination of probationers be reviewed but if a termination does take place the employee could be entitled to an uplift of 10% to 50% of the notice pay at the Employment Tribunal if the employer does not follow the statutory dismissal procedures correctly.