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Employment Update for Small Businesses
March 2023

Dear Subscriber

This month I have a new profile picture – a few more grey hairs! Thanks to Shelley Costello Photography for her excellent work. Keep an eye on our website which will soon have an update including several more of Shelley’s photos.

We consider probationary periods in this months’ update.  What they are, the legalities and how best to use them.

Please contact me if you would like to find out a bit more about any of the subjects raised in this update or if you need any help or advice.

Please forward this email to any of your contacts who might find it of benefit.

Regards
Peter Etherington
Tel: 01664 668164

www.etherington.co.uk

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Peter Etherington
Probationary Periods
What are they and how do they work?
It is not unusual for new starters to be placed on a probationary period for typically 3 or 6 months, but what does that actually mean and how should a probationary period work? Well, a probationary period has no particular legal status. Any new starter needs to acquire two years’ continuous service before they have the protection of the law on unfair dismissal. Everyone, from day one of employment (and before they start) is protected by discrimination law, irrespective of any probationary period.

The only legal consideration tends to be in relation to contract law. Often the contract of employment will provide for those in probation to be entitled to a relatively short notice period, which only increases once they successfully pass probation. A typical role may have a one week notice period in probation, rising to a month thereafter. From the employer’s perspective that can be useful if you realise early on that your new employee is not living up to expectations, so that they can be removed quite quickly and cheaply.

But probationary periods do have their uses, as they provide a framework within which you can ensure new starters are properly brought on board, through a well thought-through induction process. Whilst they remain within the probationary period, expectations can be managed – they know they are on trial and need to demonstrate that they are capable of meeting requirements.

It is a good idea to clearly set out what you expect them to achieve to pass probation, through setting targets (covering training and development, achievement of certain milestones, performance standards, etc.) You should carry out regular reviews during the probationary period so that they receive feedback and have a good idea of how they are doing. It is not helpful if they reach the end of the probationary period only to be told then for the first time that they have not performed well enough. Probationers need to know at early enough stage if they are not meeting the required standard so that they have the opportunity to improve.

One of the common mistakes we see is that the end of the probationary period is not marked in any way and an employer decides after the end of the probationary period that they want to extend it. In legal terms you will have missed the boat if you don’t extend the probationary period prior to its end date. It is assumed to have passed if no extension has already been put in place. Whilst this is not a disaster in terms of being able to dismiss someone, for the reasons noted above, it does mean that they are now entitled to the longer notice period if that is associated with the ending of the probationary period. So it is always best to diarise key dates and to make decisions about extending or ending probation prior to the scheduled end date.

National Minimum and Living Wage
From 1st April 2023, the minimum wage bands are increasing:

  • to £10.42 per hour (from £9.50) for workers aged 23 and over
  • to £10.18 per hour (from £9.18) for workers aged 21 to 22
  • to £7.49 per hour (from £6.83) for workers aged 18 to 20
  • to £5.28 per hour (from £4.81) for workers aged 16 and 17
  • to £5.28 per hour (from £4.81) for apprentices under 19 and those over 19 in their first year*

*N.B. Apprentices over 19 and who have completed at least one year are entitled to the appropriate rate for their age.

www.etherington.co.uk