The main purpose of probation is to give the employer and the employee an opportunity to see if the relationship is working out. If it is not working out, either party should be able to terminate the contract with ease by simply giving notice, typically one week.
Once an employee has 12 months continuous service he / she acquires strong protection under the Unfair Dismissals Acts and it can be very difficult to lawfully dismiss an employee.
However, employers often fall in to legal difficulty in seeking to terminate the contract, even during probation. These legal pitfalls can be avoided by the doing following:
- In the contract of employment, provide that employment can be terminated for any reason or no reason during the probation period. This gives the employer flexibility to simply hand the employee a notice letter and refer to the clause in the contract giving the employer the right to terminate on notice without a reason. Very often contracts are poorly drafted and state that the employer shall review performance throughout the probation period and will only terminate if there are continuing performance issues. While this is fair to employees it clearly reduces employer flexibility.
- Employers should also provide an express clause in contract to the effect that the company's disciplinary procedures shall not apply during the probation period.
- Be wary of giving any grounds for an employee to argue discrimination under the Employment Equality Acts as the reason for the dismissal. An employee does not need to have any minimum length of service to take an equality claim where up to two years pay could be awarded for a successful claim. Disability based discrimination tends to attract the higher awards.
- Be clear with the employee at interview stage and offer stage that the contract is subject to probation. Avoid saying anything that could be interpreted by the employee as a representation that the probation is only a formality and not to worry about it.
- Do not accuse an employee of misconduct without affording the employee some form of due process. Employees, even probationary employees, have a right to respond to allegations of misconduct which go to their good name and reputation.
With limited exceptions, the law gives an employer good flexibility to terminate during probation. However, a poorly drafted probation clause in the employment contract or a poorly handled dismissal could undermine this flexibility and lead to costly litigation.