This letter will operate to effectively establish a mutual understanding between yourself and the employee as to your plans for their ongoing employment.

What is a Probation Period?

To determine whether or not probation can be extended, it is important to know what it is and how it works. Probation periods are considered to be a trial period operating in favour of the employer, giving them the right to dismiss the employee if the employee is not a good fit. The ability to dismiss the employee at the employer's discretion is limited by the minimum employment period under the Fair Work Act, as explained below.

Probation periods are set out in the employment agreement. There will be no probation period unless it is set out in the contract. Most will last from three to six months. The key is to keep it reasonable. Employers use probationary periods in employment contracts as tools to make sure employees understand how to meet their obligations in the business. At the end of the day, it tells the employee that if they don’t suit the needs of the business, then it isn’t the right job for them.

To best make use of probationary periods, you may want to regularly meet with your employer/employee. These meetings don’t even have to be formal. They allow for a better understanding of responsibilities. And they can also make sure expectations are clarified and any possible issues can get the early attention they need.

Keep in mind that regardless of probation, a person is still technically employed. This means they are still entitled to paid leave, sick leave and all the other things somebody would receive that isn’t on probation.

Minimum Employment Period

You might ask if you could extend the probation period forever. Under the Fair Work Act 2009 (Cth), after a "minimum employment period", employees will be protected by the unfair dismissal provisions, and so it does not make sense to extend the probation period beyond this period. This period is different for small businesses and all other businesses. Small businesses are those that have less than 15 employees and their minimum employment period last one year. All other businesses’ will last six months. The minimum employment will run at the same time as probation and starts when the employment begins.

The effect of the minimum employment period is that once it ends, then the Fair Work Act will apply a much stricter standard to how a person is dismissed. This just means that if you decide that an employee is not right for your business, it is a lot more difficult to dismiss them. The probation period and whether or not it has been extended will not matter. This is why probationary periods tend to last three to six months.

For further information:

• How Do Probationary Periods Work?
• How Long Should Probationary Periods Be?
• Resigning During a Probationary Period