Only an employer with 19 or fewer employees (at the beginning of the day on which the employment agreement is entered into) may employ a new employee on a trial period for up to the first 90 calendar days of their employment.
An employee can’t be on a trial period if they’ve worked for that employer before.
If employers are hiring people on certain work visas, they will also need to consider immigration requirements relating to the use of trial periods.
A valid trial period:
- must be agreed to in the employment agreement before the employee starts work, or the trial period is invalid
- must have a valid notice period in the employment contract
- can be used in any industry and for any job
- must be agreed by the employer and employee in good faith - an employee can’t be forced into being employed on a trial period. For example, Jennifer’s boss, Omesh tells her that she has the job on Monday, she starts work on Tuesday and she signs her employment agreement on Wednesday. Jennifer’s employment agreement has a trial period for 60 days, but this is invalid because Jennifer didn’t sign the agreement before she started work. Omesh can’t dismiss Jennifer under the trial provision and if he did, she could bring a personal grievance for unjustified dismissal. If Omesh wanted a trial period for Jennifer, he should have made sure that she agreed to it, had a chance to get advice and raise any issues, and signed her employment agreement before she started work.
- means that the employee can’t bring a personal grievance for unjustified dismissal or other legal proceeding about their dismissal (as long as the employer has given the right amount of notice to the employee)
- must be in the employment agreement and must state that:
- from the very start of their employment, the employee will be on a trial for a set period which isn’t more than 90 days (but can be less). The exact time period must be stated, for example, it could be 30 days, or 90 days, or another stated time period; and
- during the trial, the employer can dismiss the employee, and
- the employee can’t bring a personal grievance or other legal proceedings about their dismissal.
If an employee is a union member employed on a collective employment agreement, they can’t have a trial period (in their individual terms and conditions) inconsistent with the collective employment agreement. For example, if the collective employment agreement states that an employee can’t be employed on a trial period, then they can’t have a trial period in their individual terms.
Our Employment Agreement Builder can help you write a trial period provision for an employment agreement.
Rights and responsibilities
Employees on valid trial periods:
- have all minimum employment rights and responsibilities (for example, in relation to health and safety, minimum pay, annual holidays, public holidays, sick and bereavement leave and equal pay), except bringing a personal grievance for unjustified dismissal
- must be treated the same as other employees who aren’t on a trial period.
Even if an employee is on a trial period, they can still bring a personal grievance on grounds other than about their dismissal, for example:
- sexual or racial harassment
- pressure about union membership
- continuity of employment under Part 6A of the Employment Relations Act 2000
- if the employer does something that unjustifiably disadvantages them
- if the employee starts working before the contract is signed
- if the employment contract does not mention that there is a trial period, or
- the employment contract does not contain a notice period in case of dismissal or resignation.
In such cases, the employee may be able to take a personal grievance against the employer and the trial period may be deemed invalid by the Employment Relations Authority.
Mediation is available to employees and employers at any time.
If the employer doesn’t give the employee notice by the end of the trial period, then they are no longer on trial and their employment will continue.
Giving notice of dismissal
If the trial period isn’t going well and the employer decides to dismiss the employee, they must give notice to the employee that they will be dismissed.
- must be the amount of notice in the employment agreement. If the employer doesn’t give the employee the right amount of notice then the trial period is invalid and the employee will continue to be employed (or if they were dismissed, they could bring a personal grievance for unjustified dismissal). For example, the employer can’t tell the employee that they are dismissed effective immediately if there is a 1 week notice period in their employment agreement.
- must be given within the trial period, even if the actual dismissal takes effect after the trial period ends. For example, if the trial period is 8 calendar weeks and the notice period is 1 week, the employer must give notice to the employee before the end of the eighth week, even though the employee won’t leave until the end of their notice period.
- doesn’t have to have reasons for the employee’s dismissal.
The employer doesn’t have to give reasons for a dismissal during a trial period, or give the employee a chance to comment before the dismissal. But it is good practice to tell the employee why they are being dismissed.