A Primer on Probationary Periods

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• Who We Are: • University of Toronto community legal clinic located in downtown Toronto

• Where We Are Located:• 655 Spadina Ave.

• What We Do: • Provide advice and representation to workers who have been denied their

rights in the course of, or in the termination of, their employment

• Represent workers at the Ministry of Labour where the employer has contravened the Employment Standards Act

• Represent wrongfully dismissed workers at Small Claims Court

• Represent individuals in proceedings at the Human Rights Tribunal of Ontario who have been discriminated against contrary to Code in the course of, or the cessation of, their employment

• Provide advice and representation at the Social Security Tribunal to workers who were denied regular Employment Insurance benefits following the employer’s termination of their employment.

Probationary Periods

What is a Probation Period?

Probation is a period when the employee may prove that he is suitable for regular employment as a permanent employee and will meet the standards set by the employer. Mitchell v. The Queen (1979) 23 O.R. (2d) 65 (H.C.J.)

For Example ….

There will be a probationary period of up to one year, during which time (at the discretion of management) you will be confirmed or rejected for the position.

Hmmmm……

What does that mean?Normally, an employer must provide reasonable notice OR pay in lieu of notice if they wish to terminate an employee.

An employee can only be terminated without notice if the employer has “just cause” based on the employee’s bad behaviour.

A probationary period is an agreement between the employer and the employee that the employee may be terminated for “unsuitability” without notice (or reduced notice), during an agreed to period of time.

“Unsuitability? Is a ….”

Higher standard than Just CauseLower standard than Just Cause

Let’s take a step back and talk about … notice

Two types of notice

In Ontario, employees are entitled to both minimum standards notice (termination pay) & reasonable notice at common law.

Notice under Employment Standards ActPeriod of Employment Notice Required

Less than 1 year (more than 3 months) 1 week

1 year but less than 3 years 2 weeks

3 years but less than 4 3 weeks

4 years but less than 5 4 weeks

5 years but less than 6 5 weeks

6 years but less than 7 6 weeks

7 years but less than 8 years 7 weeks

8 years or more 8 weeks

* Unless they quit or are guilty of wilful misconduct employees are entitled to ESA notice

Reasonable Notice at Common Law•Reasonable Notice at common law tends to be more generous:

•Factors the court will consider in determining reasonable notice:• Length of service

• Age

• Character of employment (e.g. the type of position)

• The availability of similar employment

How much more generous?According to the Wrongful Dismissal Database, average notice periods for employees working a year or less are:

• 4 -5 months (25-55 years old, Upper/Middle Management)

• 2-3.5 months (25-55 years Labourer, Clerical, Technical Positions)

Back to Probationary Periods

Probationary Period

A probationary period is an agreement between the employer and the employee that the employee may be terminated for “unsuitability” without notice (or reduced notice) during an agreed to period of time.

There will be a probationary period of up to one year, during which time (at the discretion of management) you will be confirmed or rejected for the position.

Are probationary periods automatic?No

An employee must agree to a probationary period as part of the employment contract.

While not automatic, they are pretty standard for new employees.

What constitutes a probationary period?It must be expressly included.

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. The defendant must clearly indicate what will happen if the relationship ends before the probation terminates. Easton v. Winslow Properties Corp.[2001] O.J. No. 447

Rejected Probationary Clauses“Introductory Period”

“Your performance will be reviewed…” (without any explanation of the consequences)

“Probationary Period – 90 days” (without any explanation of what it means)

XX

X

How long can a probationary period be?As long as the parties agree to.

Most probationary periods are between three months and one year.

What if the probation period is longer than 3 months?The ESA provides for one week of notice for employees who have been employed for more than 3 months.

The only exception to this is employees who have quit or been terminated for “wilful misconduct”.

Termination for “unsuitability” is NOT wilful misconduct therefore, probationary employees are still entitled to notice/termination pay under the ESA.

Can the employer extend the probationary period?A probationary period can only be extended with the employee’s agreement.

In Lowery v. Calgary, 2002 ABCA 237 (CanLII), an employee worked beyond the probationary period and it was determined that she was no longer a probationary employee.

However, where the employer clearly seeks to extend the probationary period, and the employee does not raise an objection and continues working, they may be found to have acquiesced to the extension. Miguna v. African Canadian Legal Clinic, [1996] O.J. No. 821.

What if I am terminated for “unsuitability” during the probationary period?

In order to rely on the probationary clause, the employer must show that:

(1) they provided a reasonable opportunity to the employee to prove their suitability;

(2) they determined that the employee was not suitable;

(3) the decision the employee was not suitable was based on an honest, fair and reasonable assessment of their suitability which can include not only job skills and performance but character, judgement, compatibility, reliability and future with the company. Rocky Credit Union Ltd. V. Higginson, 1995 ABCA 132, para. 6.

When is the decision not “reasonable”?1. Standards for evaluation were too high. oMourant v. Amherst (Town), 1999 CanLII 3303 (Supreme Court of Nova Scotia) Employee was hired to

be Town Manager and expected duties were, “not reasonably possible for any one person”.

2. Employee was not advised of their shortcomings.

o Alexander v. Padinox Inc., 1999 CanLII 4542 (Appeal Division of PEI Supreme Court) Employee hired into a year long probationary period during which there were no formal meetings and informal feedback was positive or at minimum, “no negative assessment of his suitability”.

3. Employment was too short to be a reasonable opportunity.o Duffield v. Alubec Industries Inc., 1998 CanLII 9721 (Quebec Superior Court) A 59 year old employee was hired as CEO

into 6 month probationary period was terminated after 11 days it was determined there was, “ no reasonable opportunity to improve nor even a reasonably opportunity to show his capacity to fill the job”

4. Termination decision was the result of a flawed process.o Several areas of the evaluation form related to areas for which the employee was not responsible. Mourant, supra.

If not reasonable, can I be reinstated?No. However, the limits of the probationary clause will not apply.

Meaning, you are still entitled to a reasonable notice period at common law.

What if my termination is discriminatory?The Ontario Human Rights Code applies to probationary employees as it would any other employee.

Where an employee makes a complaint of discrimination or request for accommodation, the employer may have to consider extending the probationary period until the issue is resolved to avoid a determination that the reasons for termination were discriminatory. Bertrend v. Golder Associates Ltd. [2009] B.C.H.R.T.D. No. 274.

Where there is discrimination, are damages limited to length of the probationary period?No. The proper test for compensation under the Code is where the complainant would have been, had the discriminatory acts not occurred.

Entitled to general damages for injury to dignity.

oSee Lane v. ADGA Group Consultants Inc., 2007 HRTO 34 (CanLII) & Bertrend v. Golder Associates Ltd. [2009] B.C.H.R.T.D. No. 274.

Wrapping Up

TakeawaysMust agree to the clause and any extension

Still entitled to ESA minimums

Human Rights Code applies without modification

Decision that employee is “unsuitable” must be reasonable

ResourcesPeter Neumann and Jeffrey Sack, eText on Wrongful Dismissal and Employment Law, 1st ed, Lancaster House, Updated: 2015-03-30 (CanLII), Retrieved from http://canlii.org/en/commentary/wrongfuldismissal/

Kwasniewski, Barry. (2009 June 24). Probationary Employees: What Employers Need to Know. Charity Law Bulletin No. 168. Retrieved from http//www.carters.ca/pub/bulletin/charity/2009/chylb168.htm

Bawden, Sean. (2012 May 27) Probationary Periods and Notice [Labour Pains Blog Post] Retrieved from http://www.ottawaempoymentlaw.com/2012/05/probationary-periods-and-notice-html.

Wrongful Dismissal Database. Online: www.wrongfuldismissaldatabase.com