Probation Periods: Everything You Need to know

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If you’re familiar with the hiring process, you know how long it takes to find a good candidate for an open position. Can you really be sure that this person is right for the job? Although someone you hire may seem like the perfect fit, there is no guarantee that they will perform the way you expect. This is why most companies implement a probation period after hiring an employee. A probationary period is a time to assess whether or not your new hire (or newly promoted employee) is a good fit for the position. This also allows the employee to see whether or not they like the new job. The probationary period typically lasts around 3-6 months, depending on the company.

Why do you need a probationary period?

As mentioned above, probation periods give employers a chance to evaluate whether or not a new hire is a good fit for the position. During this time, the employer can (and should) document how the employee is performing. If the employee seems to be doing poorly, the employer can then take the next steps to help this employee. Alternatively, the employer can also end the business relationship.

Hiring and terminating employees can be costly and time consuming for a business, which is why most companies implement a probationary period. Hiring a new employee costs over $3,000, so most employers will want to ensure that they are investing in the right person. New employees do come at a cost because management has to take time to train them, while providing wages and benefits. In most cases, new employees are not well-integrated into the position for a few weeks to a few months. This means that they won’t necessarily contribute to the company’s success right away. Consequently, the new employee will be costly and drag growth until they start contributing at the same rate as other employees.

How to prepare your new hire for a probationary period

At the point the employee is hired, the direct manager or human resources department must make the terms of the probation clear. Just like any normal employee, you will give your new hire an outline of the position’s objectives and goals. This is extremely important to ensure that this employee understands what it takes to be successful. The employee’s manager should review:

  • Standards for attendance and time off
  • Goals and achievements expected of the employee
  • Training and development expectations
  • Future goals of the company
  • How problems will be addressed

How to document your new hire

As an employer or manager, you must keep documentation of the employee’s performance during the probation period. It’s in your best interest to carefully monitor and track the employee’s performance accurately. If the employee doesn’t perform to expectations, reports should be created as soon as possible. This documentation supports your plan of action, which could include termination. Your documentation can save you from accusations of unjustified termination in the future. Review your employee’s performance every few weeks before they become permanent team members.

Time off for new hires?

Federal law does not require employers to give their employees time off or paid time off. However, certain states have their own laws regarding time off and sick leave. In New Jersey, for example, employers must give their employees 1 hour of sick leave for every 30 hours they work.

Do you need to give your employees time off? No, unless your state’s law says otherwise. Should new hires have time off? That is up to the company’s discretion. People typically don’t let new hires use any time off until they’ve passed the 40-90 day probation period. Whatever you decide, you should outline this clearly in your handbook and contracts so employees know what to expect.

What to do if the new hire is not working out

Before deciding to terminate a new hire, you may want to try and help the employee. They may be experiencing problems adapting to their new job responsibilities. You’ve already spent time and energy training person, so unless you’re willing to stop, a little faith and dedication may be a good solution. If you let the employee know what is going on, they will have a chance to reflect and improve. Try discussing their specific performance during your next review meeting. Some approaches may include:

  • Speaking with the employee about specific areas that need to be improved
  • Providing evidence so that the employee can understand what causes problems
  • Offering additional guidance and training
  • Suggest ways to improve
  • Warn the employee that this can lead to termination 

If the employee still isn’t working out, then it could be time to terminate the relationship. In most cases, you can terminate an employee any time, as long as it’s not an illegal case of discrimination or prohibited by contract. To protect your business, make sure to fully document employee performance, reviews, and other feedback before letting them go. This termination must be fair and consistent for all employees.

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