My New Employee Is Not Working Out! - Business 360 Pty Ltd
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My New Employee Is Not Working Out!

My New Employee Is Not Working Out!

Do I need to give them a reason to terminate their probationary employment?

It’s never great when your new employee just isn’t working out. You decide you have to let them go for the good of the business (or even their own good). But what is the right thing to say?

Many employers falsely believe they do not need to give a reason because they are protected by the term “probation” within their employment contract, noting there is no reference to probation within industry awards.

You do need to give a reason for terminating probationary employment, which should be delivered in simple terms such as stating to the employee “you are not the right fit for the role” or “you are not the right fit for our business”. Just look at what happened when Duty Free Stores Gold Coast failed to give the reason for terminating the probationary employment of one of their employees.

In this case, Pacheco-Hernandez v Duty Free Stores Gold Coast Pty Ltd [2018] FCCA 3734, the employee who was not eligible to lodge an unfair dismissal claim (due to the probationary employment period) lodged a “general protections” claim. She alleged that during her probationary period, she had made several complaints about her employment, including being bullied and required to undertake tasks that were not part of her job description. She alleged the reason for termination was unlawful and occurred as a result of the complaints she had made.

The employer was ordered to pay $20,000 compensation for terminating their employee’s probationary employment. The judge found that the employer’s failure to provide a reason for termination had left it open for the employee to lodge a “general protections” claim. The employer was also unable to discharge its onus of proving the employee’s complaints concerning her employment were not the reason for the termination.

How do I reduce the risk of this happening to my business?

Clear any “red flags” such as events that may seem discriminatory upon review making the dismissal seem a ruse. Performance, illness or matters in train relating to the employee should be resolved before any dismissal process is undertaken.

Your HR Policy Platform, such as your Probation Review Policy, should include regular assessment of conduct and performance during the probationary period so that issues are identified early, documented, improvement goals set, and the employee is informed of the required standards of conduct and performance.

Where termination of probationary employment is needed, should a claim for unlawful termination result, you will be better placed to prove that termination of employment was not for an unlawful reason. Be careful to ensure that assessment documentation keeps to performance and conduct issues only and where an employee raises a complaint, deal with it separately and fairly.

Unlawful dismissal comes under General Protections, and the onus is on the employer to prove that they didn’t act in a discriminatory manner at any point in the employment relationship. Unfair Dismissal, however, is a different type of claim and you shouldn’t wait until the last minute to act as it may again appear a ruse.

Did you say you don’t have a probationary employment policy?

Reach out to Business 360:

  • for a copy of our “Terminating An Employee When On Probation” Guide email info@business360pps.com.au
  • for a confidential phone discussion with one of our Team, click or scan below to book a time to discuss your needs, or
  • Call us on 1300 287 360 or email info@business360pps.com.au