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What are the rules and expectations around 90-day trial periods?

Only employers with 19 or fewer employees (at the beginning of the day on which the employment agreement is entered into) can engage a new hire on a trial period for up to the first 90 calendar days of their employment.

You can’t place an employee on a 90-day trial if they are a re-hire, the law will pre-suppose that you wouldn’t have rehired them if you didn’t think they were good employees.

A valid trial period:

  1. Any 90-day trial must be agreed to in the employment agreement before the employee starts work, or the trial period is invalid.
  2. They must contain a valid notice period in the employment contract.
  3. They can be used in any industry and for any job.
  4. They must be agreed to by both parties and in good faith – an employee can’t be forced into being employed on a trial period.
  5. An employee can’t bring a personal grievance for unjustified dismissal or other legal proceeding about their dismissal (as long as the employer has given the right amount of notice to the employee)
  6. The clause must be in the employment agreement and must state that:
  7. From the very start of their employment, the employee will be on a trial for a set period which isn’t more than 90 days (but can be less). The exact time period must be stated, it may be 30 days, or 90 days, or any other stated time period: and
  8. During the trial, the employer can dismiss the employee, and the employee can’t bring a personal grievance or other legal proceedings about their dismissal.
  9. If an employee is a union member employed on a collective employment agreement, they can’t have a trial period (in their individual terms and conditions) inconsistent with the collective employment agreement. In other words, if the collective employment agreement states that an employee can’t be employed on a trial period, then they can’t have a trial period in their individual terms

Rights and responsibilities

Employees on valid trial periods:

  • Maintain all minimum employment rights and responsibilities (eg in relation to health and safety, minimum pay, annual holidays, public holidays, sick and bereavement leave and equal pay), except bringing a personal grievance for unjustified dismissal
  • Must be treated the same as other employees who aren’t on a trial period.

Even if an employee is on a trial period, they can still bring a personal grievance on grounds other than about their dismissal, these include:

  • discrimination
  • sexual or racial harassment
  • pressure about union membership
  • continuity of employment under Part 6A of the Employment Relations Act 2000
  • if the employer does something that unjustifiably disadvantages them
  • if the employee starts working before the contract is signed
  • if the employment contract does not mention that there is a trial period, or
  • the employment contract does not contain a notice period in case of dismissal or resignation.

In such cases, the employee may be able to take a personal grievance against the employer and the trial period may be deemed invalid by the Employment Relations Authority.

This information is not a substitute for legal advice, we recommend that if you identify problems in the areas listed you consult with someone before acting on any material you have read.