An erosion of workers’ rights, or a levelling of the playing field?

The Prime Minister hinted yesterday that the 90 day trial period introduced in March last year, during which employees can be dismissed without being able to raise a personal grievance for unjustifiable dismissal, may be extended to all work places, instead of just those which employ fewer than 20 employees, as is currently the case.

The details have not yet been released, but the general principle does make sense in my view. It’s not as if employers with 20 or more employees experience fewer problems with new starters who do not work out, or that they all necessarily have better resources to deal with PGs for unjustifiable dismissals. Furthermore, the change might even encourage employers whose staff numbers hover around the 19 mark to expand their workforce.

The change must not make bigger employers complacent though. First, the trial period must not be a substitute for deploying effective and thorough recruitment methods, and just because an employer can eradicate hiring mistakes by dismissing a poor performer within the first 90 days does not justify the unpleasantness and disruption that the presence of a poor performing employee in the workplace entails.

Secondly, assuming that the substance of the 90 day trial period legislation does not change, there will still be several hurdles for the employer to jump before it can safely rely on the trial period. The most important is that the 90 day trial period, as presently legislated for in any event, only applies where the employment agreement provides for it. If the EA is silent, or the employee refuses to accept the clause, the trial period does not apply. This means that, once the 90 day trial period is extended to bigger employers, they will have to amend their employment agreements for all new starters. Incidentally, I can envisage many senior recruits refusing to accept such a clause, and employers who have spent a significant time seeking out the right candidate will probably not jeopardise their hiring for the sake of a 90 day trial period.

Employers will also have to ensure they draft the clause appropriately – 90 days is not the same as three months, for example – and that they calculate the start and end dates properly. It runs from the start of employment, not when the employment agreement is signed, and notice of dismissal must be given before the expiry of the trial period.

The final note of caution is that dismissal during a valid trial period does not protect the employer from claims for discrimination or disadvantage. So, if the reason for the dismissal was a prohibited ground of discrimination as set out in the Human Rights Act, say, or if the employer treated the employee detrimentally prior to the dismissal, or arguably even in the way the dismissal was handled, a claim would still be allowed. This is because the legislation prevents the employee from raising a personal grievance or legal proceedings in respect of the dismissal itself, not other circumstances related to the employment.

How far the law will be changed will be revealed shortly – one thing is for certain though – whatever the details, we will still see plenty of challenges in the courts.