Many employers like to take the first few months of a new employee’s employment to decide whether their new hire is the right addition to the team. Some like to call it a probation, others, a trial or evaluation period. Irrespective of what it is called I have noticed three recurring assumptions about this initial period that are worthy of attention by both employees and employers. Employers relying on these assumptions may believe themselves better protected against claims for payment of reasonable notice than may in fact be the case. Employees for their part may assume that they have no recourse following a termination during their probation period which again, may not always hold true.
Assumption #1 – An employer can automatically terminate an employee during the first three (3) months of employment without providing the employee notice or pay in lieu.
The right to terminate without notice during the probation period is not automatic. Although the Employment Standards Act, 2000 (“ESA”) stipulates that an employee who is terminated within the first three (3) months of their employment is not entitled to notice or pay in lieu, a court will not simply infer that the employee has agreed to these terms. Justice Lederman in Easton v. Wilmslow Properties Corp  O.J. No 447 reasoned:
The existence of a probation period is a question of fact in each case. Since it takes away an employee’s usual rights, a probationary period must be expressly agreed to by the employee. It cannot be implied into the relationship…
Assumption #2 – In the absence of a clear probationary period clause, the amount of notice that a short service employee is entitled to receive is necessarily very minimal.
Some employees who have had their employment terminated within the probation period (and who did not have enforceable probation clauses in their contracts) have been awarded some relatively lengthy notice periods. To give three examples: In the case of Easton, the plaintiff who was terminated after two weeks was awarded three (3) months’ notice because she had left a reasonably secure job to work for the defendant employer. Likewise, in the case of Rejdak v.The Flight Network, the employee was awarded four (4) months of notice after eleven (11) weeks of work. Similarly in Deacon v Moxey, 2013 CanLII 54099 (ON SCSM) the employee was awarded three (3) months of notice after working two (2) weeks.
Assumption #3 – Extending a probation period provides the employer a longer period within which they can terminate the employee without notice.
While an employer can stipulate a longer probation period (i.e. 6 months) in an employment contract, this does not automatically extend the window that an employer can terminate the employee without notice or pay in lieu. Employers will want to ensure that the probation clause is drafted to ensure that there are no violations of the ESA.
Whether you are an employee or an employer, if you have questions about drafting or the enforcement of a probation clause our employment lawyers would be pleased to assist.