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Probation completed: Can an employee claim unfair dismissal?

Probation completed: Can an employee claim unfair dismissal?

Members are often confused about whether an employee is eligible to claim unfair dismissal if they are terminated following the completion of the agreed probation period.

A scenario

An agency has agreed with a new employee that there will be a three month probation period. After five months of service, the agency determines that the performance of the employee is not satisfactory and wishes to terminate their employment.

If the employee is dismissed, are they eligible to claim unfair dismissal as they have completed the probation period prescribed in the employment agreement?

Answer

The Fair Work Act does not refer to a "period of probation" with respect to unfair dismissal laws. Rather the Act refers to the minimum period of employment (MEP) after which an employee may claim unfair dismissal.

In the case of a business that employs 15 employees or more, the MEP is six months' continuous service. In a business with fewer than 15 employees, the MEP is 12 months' continuous service.

To calculate the number of workers employed at a particular time, all employees (including casual employees) are to be counted, as well as the employee(s) being dismissed. It excludes casual employees who have not been employed on a regular and systematic basis.

In this case, the employee would not be eligible to claim unfair dismissal if they are dismissed before completing the relevant MEP (six months or 12 months of continuous service with the employer as the case may be). The terms of the Fair Work Act would override the terms of the probation period provided in the employment agreement.

General protection claims

It should be noted that there is no MEP with respect to adverse action claims (which includes termination of employment) under the general protections provisions of the Fair Work Act. These provisions provide protection from, for example, discrimination or the exercising of workplace rights.

Also, the adverse action provisions carry a reverse onus of proof. This means that where an employee alleges that adverse action has been taken for a prohibited reason or with a particular intent, the court will presume this is the case unless the employer can prove otherwise.

Recruitment policy

As a probation period enables an employer to determine the suitability of a new employee to a position, an employer may wish to continue to apply a probation period under this circumstance under their recruitment policy.

Message for employers

An agency's probation period is not relevant with respect to eligibility requirements relating to the unfair dismissal provisions of the Fair Work Act. The relevant MEP would apply in all instances.



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The Real Estate Employers' Federation is the real estate industry’s leading not-for-profit employer and workplace relations advisory association. It has more than 1600 members and subscribers across Australia.

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