News Article

latest news in employment law


Published 01 Oct 2010

The Employment Court has yet to rule on what all the requirements are for the 90 Day Trial Law.

Until that happens, and it will, proceed with caution. We recommend you contact EAL on 0800 15 8000 before dismissing anyone.

Disadvantage claims are possible if an Employer does not give appropriate warning(s). Employers should follow normal warning processes if they wish to avoid the risk of disadvantage grievance claims. However, disadvantage claims, if taken, are likely to be limited to unnecessary hurt and humiliation. Given only short term employment is at issue, awards are likely to be relatively minimal.

All the duties of good faith apply during 90 Day Trial Periods. That means employees entering into 90 Day Trial Periods can bring a grievance against an employer if they are unjustly treated. It is recommended that there is a systematised 90 Day Trial Period, which provides for a justified and procedurally fair relationship. There is one important exception to this and that is the express exclusion of the good faith duties in section 4(1A)( c) of the ERA. That subsection refers to duties owed to the employee when dismissal itself is contemplated. At the point of dismissal no opportunity to comment, prior to decision is required. Therefore, at the point of dismissal there is no need to set up a meeting to share information, nor a discussion of the issues with a representative.

Because there is a statutory right to dismiss at any time during a 90 Day Trial period this has a major impact on what, if any, warnings are required. What type and number of warnings will be dependant on the seriousness of the problem.

It is recommended that you treat 90 Day Trial Period employment in the same way as a probationary period with the exception that a dismissal will not be challengeable. Treatment of the person during the 90 Day Trial Period will be up for challenge.

Serious defects in conduct or performance may enable immediate dismissal.
But minor performance issues need to be processed in the normal way.

The 90 Day Trial Period should utilize procedures due to poor performance.

It may well be that the Minister will address this inconsistency shortly.

When dismissing you must provide the agreed notice (or pay in lieu). This could be 1 day, or 1 week, or some other period which is appropriate to your business.

The Employment Court has ruled you have to give the employee a reason for the dismissal. (A written reason or reasons is recommended).

Please find below a sample dismissal letter:


Dear X
The Company has decided to exercise its right to end our employment relationship under the 90 Day Trial Period Law which is a written part of our agreement with you.

The agreed notice period is....

The reason(s) for our decision is/are..............

(If you can say anything positive e.g. 'this is not a reflection on your personality'. then doing so is a good idea, but always optional.)
Your employment will therefore end on [date] and you will be required to work through your notice period. [Or, the company has decided to pay you in lieu of requiring you to work through your notice period].
Your final pay will be calculated on [date]

We will provide a certificate of service covering your period of employment. (A reference could be offered in some situations but again is optional)

Yours sincerely