The best 90 days ever spent
Posted on 21 March 2014
“So Bob (not his real name!)” I said, “we’re happy to engage to recruit a solutions salesperson for you, but you’ve indicated the person you hired [directly yourselves!] hasn’t worked out. What’s your process for removing them?”
“No problem” replies Bob, “they’re within their 90-day trial so I can just let them go!”
“Hopefully” I replied, my concern being raised. “Is your clause worded correctly?”
“Well it’s the same one we’ve always used and it was written by our lawyer five years ago, so we’re fine.”
Oh no. Our conversation from here was unprintable but let’s just say that Bob’s enthusiasm turned to surprise, when I informed him that the 90 day trial period act requires very specific wording to be executed. This surprise turned to horror when upon reading Bob’s clause it was clear that it was referring to the old legislation and specifically a “Probation Period”. This wording and clause effectively meant having to performance manage his poor performing salesman from day one to be executed. Which he’d not done. Thus, the painful performance management process had to begin.
Now I find the law fascinating. Always have. At least that’s what I told myself as I had to repeat the only paper I’ve ever had to; 72.101 Commercial Law. Geared towards my chosen path of study it was a broad coverage of everything business related, then some specialties eventuated afterwards. Outside of some interesting oddities (Such as the eggshell skull principle/thin skull rule – or you take your victim as you find him rule of the common law) the enduring thing that stuck with me is that when writing contracts you must be incredibly careful to ensure how you intend to be represented is in fact worded correctly.
If you don’t, you may need to pull the contract out only to discover your mistake, and you’ll most likely be stuck with it.
So back to Bob and this weeks topic, the 90 day Trial Period. This was brought in for sub 20 employee businesses in 2010, and in April 2011, it was made available for all employers. It’s a powerful piece of legislation that allows both parties to effectively ‘trial’ each other.
In essence, it means that you can hire someone, with the correctly worded clause and fire them ‘at will’ during their first three months of employment. Why would you do this you ask? The interview process is a flawed and challenging process for both parties, and despite every piece of diligence, occasionally it can go wrong. Sometimes horribly so.
No doubt this isn’t news to you, but how do you take advantage of it whilst keeping your nose clean? Follow a few simple rules – with the caveat that I’m not a lawyer, so if you’re unsure please consult someone who is a lawyer. Preferably an employment specialist.
So what do you need to do;
- The individual employment agreement needs to be received and signed a few days before the employee starts – not on the day. This nullifies it.
- It needs to be of their own free will.
- It needs to state “Trial Period” and the section of the act (s67A Employment Relations Act 2000)
- To be safe state that you will review performance, conduct, compatibility and any other issues – and if unsatisfactory this may result in their termination.
I’ve been told that upon termination you don’t need to provide a reason, unless asked. If asked, it’s probably best to provide a solid reason – i.e. not something like “I don’t like your shirts”.
If you aren’t using this opportunity don’t be put off by it, it is now very commonplace amongst employers and new staff (except executive levels) are largely understanding of it.
Just be aware however, this clause is a two-way street. If you can terminate with one weeks’ notice (or whatever is stated in the IEA – it could be one day) during their first 3 months, so can they! Lastly, if you execute the 90-day clause, be aware that the jilted employee could still take out a personal grievance, so do things by the book!