The Myth of the Probation Period

One of the most persistent misconceptions in Australian employment law is that a "probation period" gives employers the right to terminate freely, without consequence. It's written into thousands of employment contracts across the country. And it's fundamentally misunderstood.

The reality is this: there is no concept of a "probation period" under the Fair Work Act 2009. The term has no statutory meaning. What does exist is the minimum employment period — and it only affects eligibility for one specific type of claim.

What Is the Minimum Employment Period?

The minimum employment period determines when an employee becomes eligible to lodge an unfair dismissal claim under Part 3-2 of the Fair Work Act. The period is:

• 6 months for employees of non-small business employers (15 or more employees at the time of dismissal)
• 12 months for employees of small business employers (fewer than 15 employees)

Until this period is served, the employee cannot bring an unfair dismissal claim. That's all it does. It creates a threshold for one avenue of claim. It does not create a "risk-free" termination window.

What a "Probation Period" in a Contract Actually Does

When employers include a probation period in an employment contract, it typically serves two practical purposes:

1. Shorter notice period during the probation term — the contract may provide for one week's notice during probation versus four weeks after.
2. A structured review point — a trigger to formally assess whether the employee is meeting expectations before confirming ongoing employment.

That's it. A contractual probation period does not override the Fair Work Act. It does not exempt the employer from any statutory obligation. And it does not protect against all claims.

Claims That Apply From Day One

Even during the minimum employment period — and regardless of any probation clause — the following claims are available to employees:

General protections (adverse action). If the termination is for a prohibited reason — such as the employee exercising a workplace right, taking leave, making a complaint, or being discriminated against on grounds of race, sex, age, disability, or pregnancy — a general protections claim can be lodged from day one. No minimum service required. No income cap. Reverse onus of proof.

Anti-discrimination laws. Federal and state anti-discrimination legislation applies from the first day of employment. Terminating someone because of a protected attribute is unlawful regardless of tenure.

Breach of contract. If the employer fails to comply with the terms of the employment contract — including notice provisions, agreed entitlements, or conditions — the employee can pursue a contractual claim.

Workplace health and safety. An employee dismissed for raising a safety concern or refusing unsafe work may have protections under WHS legislation and the Fair Work Act.

Where Employers Get It Wrong

The most common mistake is treating the probation period as a blanket shield. It sounds something like this:

"They're still in probation, so we can just let them go."

You can terminate during this period, yes. But the reason still matters. If the real reason — or even a contributing reason — relates to a protected attribute or a workplace right, you are exposed to a general protections claim regardless of tenure.

The second mistake is failing to document anything during probation because the employer assumes they don't need to. When a claim is later lodged, there's no written record of the performance concerns, no evidence of feedback, and no paper trail supporting the decision. The employer is left trying to reconstruct a narrative after the fact.

Best Practice During the Minimum Employment Period

1. Treat new employees the same as established ones when it comes to documentation. Record performance concerns, provide feedback, and keep notes of conversations.
2. Assess genuine performance before acting. If you're going to terminate, make sure the reason is clearly about conduct or capability — and that you can demonstrate it.
3. Check for recent workplace right activity. Has the employee recently taken leave, made a complaint, or requested a flexible arrangement? If so, proceed with extreme caution.
4. Give proper notice. Even during probation, the employee is entitled to the notice period specified in their contract or the applicable modern award — whichever is greater.
5. Get advice if in doubt. The cost of a 15-minute phone call with an IR specialist is a fraction of what a general protections claim will cost to defend.

Need Help?

Industrial HR helps Australian businesses navigate the legal realities of managing employees from hire to termination. If you're unsure about your obligations during an employee's early tenure, contact us.