The recent change in Government saw the introduction of 90-day trial periods for all organisations. The intention of this employment trial is to reduce risk to organisations when employing someone new, ideally making them more willing to give prospective Employees a chance. You still need to follow a good faith process with your Employee, as although 90-day trials will decrease your risk when dismissing an Employee, you are still not entirely exempt. A recent case from the Employment Relations Authority saw a minor mistake from an employer face costly consequence.

An Employee was dismissed under the 90-day trial period as the Employer claimed this Employee made plenty of mistakes, was regularly late for work, took extended breaks, claimed time they had not worked and continuously made excuses. There was further dispute whether the Employee had accessed the internet on the office computer and then deleted its history. The Employer claimed that the trust between the parties was breached, and that the employment relationship had broken down. Although the Employee was provided an employment agreement that was signed on their first morning of employment, they were not given an opportunity to review the agreement in their own time and seek legal advice, resulting in a void and unenforceable 90-day trial period. This led the Authority to decide that the employee was unjustifiably dismissed because the employer failed to complete a fair process before the dismissal resulting the Employer having to pay out over $17,000 (Lenoel v Waikato Windoware Ltd, 2023.)

Say you are in the situation of considering releasing someone under the 90-day trial period, have you considered that the following could apply to you?

1. Strict Compliance with Trial Period Requirements: Trial periods must comply with specific legal requirements. Failure to comply will result in an unenforceable trial period.

2. Grounds for Personal Grievance: Even during a valid 90-day trial period, an employee can still raise a personal grievance for:

3. Bad Faith or Duress: Situations where the employer did not act in good faith or where the employee was pressured into accepting the trial period under unfair conditions.

4. Breach of Employment Agreement: If the terms of the employment agreement, including the trial period clause, were not properly observed or enforced.

5. Unlawful Discrimination: Claims of dismissal based on race, sex, age, disability, or other protected characteristics.

6. Harassment: Allegations of harassment experienced during employment.

Ensuring your business is compliant with 90-day trial standards is a crucial aspect of bringing on a new team member. Not informing an Employee of their right to seek legal advice or not giving them enough time to review the agreement in their own time, will result in an unenforceable trial period, giving the Employee very strong grounds to pursue an unjustified dismissal claim.

People Passion urges all employers to provide new Employees with three or so working days (the more time, the better) to review their employment agreement and seek independent legal advice if they wish. Providing an employment agreement on the first day places you at risk. Additionally, provide your Employee with a documented check in/review around the 30 and 60 day mark, review their feedback with them and let the feedback be heard by both parties. This is a great opportunity to voice concerns and to allow time for improvement (if necessary).

Please reach out to us if you are intending to terminate under the 90 day trial, so we can help you with best practices.

This article is not intended to replace legal advice.

90 Day Trial Update

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