Can you clarify for me what a probationary period means in terms of our legal rights as an employer? I thought that if we had a 90-day probationary period, that meant we could easily terminate a new employee without any legal hassles. But I went to a conference, and the speaker said that a) we shouldn’t have a probationary period, and b) we should still have good documentation and reasons if we are going to terminate someone during their probationary period. — Abby in L.A.
400+ pages of state-specific, easy-read reference materials at your fingertips—fully updated! Check out the Guide to Employment Law for California Employers and get up to speed on everything you need to know.
For the answer to this commonly asked question, we turned to Sandra Rappaport.
There seems to be a fair amount of confusion over the question of ‘probationary’ periods for new employees, as some employers are advised to eliminate them entirely, while others are advised to establish them. Those advising against them generally do so because there is a legal risk that these policies will create express or implied restrictions on what employers can do after the probationary period ends.
For example, there have been cases where courts have interpreted employer probationary period policies to imply that employees could not be terminated without cause once they completed their probationary periods. The employers had not drafted their policies in a way that reserved them the right to terminate employment at any time.
On the other hand, having some sort of evaluation period for new employees can be quite worthwhile. The key is careful drafting of the applicable policy. The name given to the initial period of employment (options aside from ‘probationary’ include ‘introductory,’ ‘orientation,’ or ‘evaluation’) is not as important as the language used to describe the effect of completing the period. Employers who wish to have initial evaluation periods but also wish to maintain at-will employment relationships need to draft their policies in a way that avoids creating limitations—expressed or implied—on the right to terminate the employment relationship either during the introductory period or after it’s completed.
Of course, this issue generally does not present itself to employers who are parties to collective bargaining agreements. Such agreements usually require a ‘just cause’ standard for termination, and the terms of any probationary period (which might allow the employer to terminate employment without just cause during such a period, for example) would be specified in the collective bargaining agreement itself.
Other elements that should be addressed in a policy governing an initial evaluation period include:
- benefits eligibility during the period
- paid time off accrual during the period
- the categories of employees covered by the period
- whether (and for what reasons) the employer may extend the duration of the period.
Also, if an employer has a progressive discipline policy, the policy governing the evaluation period should specify whether progressive discipline will be applied to employees in their initial evaluation period.
Now we’ll turn to the question of whether you need a good reason to terminate someone during his or her evaluation period. The answer is yes, because even if an employer has implemented a probationary period of some sort, employees in their probationary period still enjoy the protections of most employment laws. For example, employers cannot fire employees in their probationary period for a discriminatory reason such as gender, race, or religion. Employers also cannot retaliate against employees for engaging in protected activity, such as opposing discrimination or other whistleblowing, even during the probationary period. As a result, it is advisable for employers to think through whether they can articulate a legitimate reason for any termination—even one that occurs during the probationary period. Otherwise they leave themselves open to charges of discrimination or retaliation without any way to defend themselves.”
Sandra Rappaport is a partner at the San Francisco office of law firm Hanson, Bridgett, Marcus, Vlahos & Rudy.