Case confirms employees have rights during probation period

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Employers need to demonstrate good faith during probation periods when they’re assessing whether a relationship with a new employee is going to work out, Toronto employment lawyer Miriam Anbar tells

Although we often take probationary periods and clauses in employment contracts for granted, a recent British Columbia case provides some lessons for employees and employers alike, says Anbar, an associate with Rodney Employment Law.

“The purpose of a probationary clause is to enforce an assessment period, to evaluate the suitability between a new employee and the employer. While the test for a dismissal in a probationary employment period is suitability, and is generally treated as a low threshold to meet, the assessment needs to be a genuine one,” says Anbar.

If the employer finds the employee is not appropriate for the position and the relationship isn’t a good fit, they can legally terminate with no notice and no pay in lieu of notice.

But, says Anbar, the employer must act in good faith.

“What was highlighted in this case was that the employee was not given an opportunity to demonstrate his suitability for the role. This is an example where the employer failed to carry out the probationary assessment in good faith,” she says.

The B.C. court’s decision to award three months’ pay in lieu of reasonable notice for an employee who spent about two months on the job was a surprise because suitability is considered a relatively easy threshold to meet, Anbar adds.

The case highlighted examples of the employer not acting in good faith and not being fair to the employee.

“It is a clear reminder that a duty of fairness needs to exist during the period of assessing suitability,” Anbar says.

“We advise our clients to use the probationary period wisely and take advantage of those first three months,” Anbar says. “It is a period of time for both parties to evaluate the fit between the employee and the employer.

“The optics (of this decision) are quite surprising. But at the same time, it highlights probationary employees’ rights, which are sometimes overlooked. There is a notion that during their probationary period an employee doesn’t really have any rights. So this case kind of spun that theory on its head.”

But probationary periods can be implemented properly, she adds, and they exist in employment agreements from entry level to executive positions. Employers are reminded to use these clauses properly and be fair to the worker.

Anbar suggests employers set out proper employment obligations when offering a position and clearly outline the expectations and the terms and conditions of the job during the probationary period. Employees, meanwhile, should be given a fair chance to demonstrate their suitability prior to termination.

For employees, it is prudent to have an employment contract vetted prior to signing and make sure they understand the terms and conditions of the probationary period.

“In this case the fact that the company displayed conduct that was not in good faith really worked against them. Typically, you would see an employer have more discretion during the probationary period,” she says. “The terms and the conditions must be clarified from the onset of the employment relationship.”

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