Probationary Periods and Fair Procedures

Two recent Labour Court decisions have reiterated the need for employers to apply their disciplinary procedures where an employee on probation is being dismissed. A common and mistaken belief among employers is that there is no requirement to apply fair procedures if an employer decides to dismiss an employee on probation.

Recent Cases
In Glenpatrick Water Coolers Limited v a worker, the Labour Court recommended that the employer pay €6,500 to an employee who was unfairly dismissed after being summarily dismissed whilst on probation.  The employee was called to a disciplinary meeting after the employer became aware of some issues with the employee’s performance.  The meeting was called without advance notice and representation and the employee was subsequently dismissed without any further meetings or disciplinary procedure.  The court noted that the employee’s contract purported to provide that normal disciplinary procedures do not apply during the probationary period.  The court stated that it had consistently held that an employer is not relieved of the obligation to act fairly during a probationary period.  In particular, it noted that the employer failed to adhere to the Code of Practice on Grievance and Disciplinary procedures (SI.146 of 2000) which should apply whenever an employee is in danger of losing their job for alleged misconduct.

In the second case, an engineer won his claim for unfair dismissal at the Labour Court and the court recommended that the employer pay €33,400 after it was found that the company committed "egregious" breaches of fair procedures.

The claimant was two months into his probationary period before being dismissed.  As he didn’t have the requisite service under the Unfair Dismissals Acts 1977 to 2015 the case was heard under the Industrial Relations Act 1969 (as amended).  The court held that, notwithstanding the fact that the company’s disciplinary procedure stated that it would not apply to any dismissal during the probationary period (or an extension thereof), the Code of Practice on Grievance and Disciplinary Procedures (referred to above) is still relevant and should be adhered to in such circumstances.  In particular, the court emphasised that the employer’s decision not to adhere to its own disciplinary procedures or to deem itself bound by the aforesaid because the worker was on probation was “misconceived”.

The misconception generally arises from an employee’s contract and where it purports to exclude the application of a company's usual disciplinary procedure while an employee is on probation.  Generally the wording of probationary clauses in an employee's contract provides that employers may terminate the employee’s employment if performance is not satisfactory or for any reason during probation.  In such circumstances, an employee may be dismissed at any time during the probationary period.  If the contract is silent on whether an employer can immediately dismiss then the safest option is for the company to provide an abridged version of the disciplinary procedure. Probationary periods should not extend over a year and employees on probation are generally not entitled to bring claims under the Unfair Dismissals Acts 1977 to 2015.

Despite the inapplicability of the above Act, employees on probation with less than 12 months service are still entitled to fair procedures and natural justice and employers should, at a minimum, provide the employee with an abridged/scaled back form of disciplinary process.  Employees on probation may also bring claims under the Industrial Relations Act 1969 (as amended) with regard to the procedural fairness of a dismissal.  These rulings are, however, not binding on an employer.  An employer should also bear in mind other potential remedies which may be available to an employee.

The employer may also be exposed to a claim for civil proceedings based on the dismissal for breach of contract or wrongful dismissal, but these are relatively rare.  There is also the possibility that an employee dismissed on probation may argue that they were dismissed on a discriminatory ground (age, race, religion) etc. and may pursue a claim under the Employment Equality Acts 1998 to 2011.

These determinations demonstrate the level of protection which the courts are willing to afford to employees on probation.  It also highlights the need to apply some form of disciplinary process when considering dismissing an employee on probation. This process should ensure at a minimum that employee's rights to fair procedures and natural justice are respected.

For more information please contact Sinead Grace, or your usual contact in A&L Goodbody Solicitors.

Date Published: 8 December 2015