(Originally posted December 2018, updated February 2020)
We have considered probation a number of times previously on our blog, usually from the point of view of the employer. In this post, we’re going back to basics, with what we’re calling “Probation FAQs” for employers and employees.
What is probation?
Basically, probation is a period of time, commencing at the start of the employment relationship, for the employer to make a good faith assessment of a new employee’s suitability (Buchanan v. Introjunction Ltd.).
The length of the probation period is up to the parties to negotiate but is most often set at between three and six months.
Can an employee be fired during probation?
Yes. It’s important to note that, if an employer wants to fire an employee during the probationary period without providing notice or severance (more on this below), the question is whether the employee was suitable for the position, not whether there was just cause to fire her.
How should an employer assess an employee’s “suitability”?
An employer is not required to give reasons for dismissing a probationary employee. However, if an employee is fired during probation and sues the employer for wrongful dismissal, the court will consider the following in terms of the employer’s conduct in assessing the employee:
1. Whether the probationary employee was made aware of the basis for the employer’s assessment of suitability before, or at the commencement of, employment;
2. Whether the employer acted fairly and with reasonable diligence in assessing suitability;
3. Whether the employee was given a reasonable opportunity to demonstrate his / her suitability for the position; and
4. Whether the employer’s decision was based on an honest, fair and reasonable assessment of the employee’s suitability, including not only job skills and performance but also character, judgment, compatibility, and reliability (Ly v. British Columbia (Interior Health Authority).
How much notice or severance is a probationary employee entitled to on termination?
There are three sources of law to consider when answering this question:
1. The first is BC’s Employment Standards Act (the ESA). Under section 63 of the ESA, an employee (probationary or otherwise) who is dismissed without cause within the first three months of employment is not entitled to notice or severance under the ESA. Any employment that lasts beyond three months will trigger a right to statutory notice or severance.
This means that if a probation period lasts longer than three months, an employee who is dismissed while on probation but after three months have passed must receive the notice or pay in lieu (aka severance) set out in the ESA.
2. The second is any written employment contract governing the employee’s employment. If such a contract exists, it may or may not specify how much notice or severance the employee is entitled to on termination (during the probation period or beyond). If properly drafted, such a clause will govern how much severance the probationary employee gets; if such a clause provides for less severance than set out in the ESA, however, the clause will be ineffective.
3. Last is the common law. Regardless of when a probationary employee is dismissed and whether s/he is entitled to ESA notice /severance, he or she can also claim wrongful dismissal against the employer and sue for additional severance, arguing that the employer did not properly assess the employee’s suitability. The amount of additional common law severance the employee could be entitled to will depend on the employee’s age, seniority, ability to find similar work, and other factors. (If there is a properly drafted severance-limiting clause in the employee’s employment contract, this will likely prevent the employee from obtaining common law damages beyond those set out in the contract, of course.)
How does this work in practice?
As an example, ABC Co. hires new employee Katie. ABC Co. and Katie enter into a written employment contract that specifies a 6 month probation period, but doesn’t say anything about termination or severance. After five months, ABC Co. decides to dismiss Katie because it has determined she is not a good fit. ABC Co. does not have to give any reasons for terminating Katie’s employment but must have acted in good faith in assessing her ability to do the job. ABC Co. will have to pay Katie one week of wages pursuant to the ESA as severance. Katie could also choose to sue ABC Co. for additional common law severance, however, she will need to prove that they did not properly assess her suitability for the position.
Have questions about probation? Contact us!