Understanding the 90 day trail clause

As we approach the 90-day mark post 1 June, we have had a number of dairy farm employers checking in with us about their new team members who aren’t working out for a variety of reasons, with questions about how easy it is to use the 90-day trial clause.

This question always comes with a bit of a ‘self-check’ moment around whether this is truly a case for letting a new team member go, or a knee-jerk reaction to a one-off incident or concern.  More often than not there are genuine reasons and concerns for considering terminating a team member under the 90-day clause, so we get that employers may wonder why we do this double check before giving advice.  But we’re reminded of a situation a few seasons ago when we went through this question – and the answer was “she’s actually okay, but she doesn’t know enough, and I just don’t have time to train her”.  Following a broader conversation around some alternative options for this employer, the decision was made not to terminate – the team member in question is still there, has now been promoted to 2IC, and the employer has thanked us a number of times over the years for having the honest conversation with him.

Generally though, by the time an employer gets to the point of picking the phone up to ring us, there is a genuine reason or reasons for using the 90-day trial clause to terminate. 

What we do see in some cases is a lack of understanding around whether or not you can use the clause, and if so, what process you should follow.

So first things first, can you use it?  There are some basic checks to do:

  • Are you still within the first 90 calendar days of employment?

  • Do you have fewer than 20 employees in your business?

  • Is the 90-day trial period written into their employment agreement in a legally binding way?

  • Were they given reasonable time to consider their employment agreement and the trial period prior to signing?

  • Did both parties (you and them) sign the employment agreement prior to them starting?

If you can answer yes to all of these, and this team member has never worked for you before in any capacity, then yes, you can use the 90-day trial period to terminate.

So having done the self-check around whether this is the best course of action or not, and the compliance check to determine whether you can take this action, can you just terminate, right?

Because the 90-day trial period is a very strong tool for the employer to use, we see the Employment Relations Authority applying the Employment Relations Act strictly to ensure that employers use it correctly, fairly and in a legal way.  It is important that you follow a good process and terminate your team member lawfully, without missing any steps.  There are a number of resources online that can help you to do that, but if you want to be really sure that you’ve got it right, the team here at No8HR have the expertise and tools to help you do this in a safe and efficient way. 

Give us a call on 07 870 4901 to have a chat about your situation today.