The Six Minute Probationary Employee

by Ian Werker
Barrister & Solicitor


Introduction
Probation Defined
Probation Not Implied
No Three Month Limit to a Probationary Period
Onus and Standard of Cause on Termation
Unilateral Extensions of Propationary Periods
Notice Considerations
Escape Hatch
Conclusions

Introduction

As an employment lawyer, you are not likely to deal with many cases concerning probationary employees. One can spend a great deal of effort sorting out how to apply the standard of cause for a probationary employee. At the end of the day, you are still going to be dealing with an employee who by definition has relatively short service. For many employees, the issue may not be worth pursuing. However, even for short service employees, the applicable notice period may be significant.1
This paper will highlight key points for consideration when you are faced with a termination involving a probationary employee.

Probation Defined

Probation may be defined as a trial period during which the employer will review and evaluate the employee to determine if he/she is suitable for ongoing employment.2

Probation not Implied

A probationary period will not be implied into a contract of employment and automatically imposed on the employee. In order to establish an employee's probationary status, this must be done in the offer of employment and agreed to before the employee starts to work.
If the employee accepts an oral offer of employment that does not specify a probationary period, then the deal has been made and no probationary period applies.3 The onus is on the employer to prove an alleged probationary term.
In the "real world" however, it is not unusual for an employer to present the "written agreement" for the employee to sign after acceptance of the offer (or worse, after the employee has started to work). As in any other situation, the document is not the deal; it is only evidence of the deal.
Even if there is a company policy that stipulates all new employees are on probation, the court will look to the circumstances of the hiring in question to see if the policies have in fact been incorporated into the employment contract.4
As a practical matter, many employees will not object to the addition of such a provision after hiring for any number of reasons. The employee may have mistakenly assumed that he/she was automatically on probation. The more likely explanation is probably that he/she needs the job and is not going to "make waves" during the proverbial "honeymoon period". However, in a situation where the employee has been recruited away from other secure long-standing employment, he or she may not passively accept the addition of a probationary term and may well have the bargaining power to make an issue of the attempt.

No Three Month Limit to a Probationary Period

The common law does not impose any limit on how long a probationary period may be. At common law, no notice is required to terminate an employee on probation. This has been moderated by the Employment Standards Act5 (Act) which establishes a minimum statutory notice for all employees depending on their length of service.
The Act does not create a probationary status for employees. But it does say that no minimum notice is required for employees with less than 3 months service.6
Given the interplay between the common law and the Act, probationary periods will generally run for 3 months. In effect, the statutory and common law notice requirements overlap during the first three months and employers may avoid the requirement to give notice to terminate for cause either at common law or under the Act.
In some cases, the nature of the position makes it prudent to establish a probationary period in excess of 3 months. For example, an employer can provide for a 6 month probationary period, so long as the employment contract complies with the minimum statutory requirement to give notice. If the employer wishes to terminate the probationary employment after the third month, it would have to give the employee at least 1 week's notice as required under the Act.7

Onus and Standard of Cause on Termination

The onus will be on the employer to prove that it terminated the employment of a probationer for cause.8
It is generally understood that the test for cause is lower for probationary employees than it is for "regular" employees who are not hired on (or have passed their) probation. Beyond that, the legal waters tend to become a bit murky.9
The leading case in this area is Ritchie v. Intercontinental Packers Ltd.10
Referring to Ritchie in one relatively recent Ontario decision, the Court had the following to say about the onus and standard as it applies to probationers in comparison to regular employees:
The employer is still required to show just cause but there is a lower standard as to what will constitute cause. A probationary employee can be dismissed if he is simply found not to be suitable. If the employee does not meet the standards of conduct reasonably imposed by the employer, he can be terminated in the probationary period. Similarly, a probationary employee who proves not to be compatible with the nature of the workplace or with other employees in the workplace can be terminated. All of this, of course, is subject to the requirement of the employer acting in a manner that is bona fide.11 (emphasis added)
In broad strokes, Ritchie can be used to support the following key points:
* The employer may evaluate suitability and/or compatibility (which involves an element of subjectivity).
* In doing so, it must impose reasonable standards of conduct (which imposes objective limits).
* Standards of conduct must be communicated to the probationer at the time of hiring.
* The probationer must be given a fair opportunity to meet those standards and should be reasonably informed (or warned) about his/her progress (or lack thereof) during the trial period.
* In assessing the probationer, the employer must make its determination for untainted valid reasons.
In light of this, an employer should be careful to consider and list the test criteria at the outset of the relationship, preferably right in the offer of employment. To avoid tainting its determination to dismiss, the employer must actually evaluate the employee against those criteria - and not other ones.12
In sum, the common law requires that the employer provide a probationer with a "fair, honest and valid assessment" of his/her competence and suitability for ongoing employment.13

Unilateral Extensions of Probationary Periods

Strictly speaking an employer may not unilaterally extend a probationary period without the consent of the employee. To do so would arguably constitute a constructive dismissal.
However, in most cases, the imbalance between the bargaining power of the employer and employee will usually result in the employee acquiescing in, or actively accepting, the extension by continuing to work for the employer. Having done that, the employee would be hard-pressed to subsequently assert a claim for constructive dismissal. 14 In addition, the employee who stays on in such circumstances will likely be found, in any event, to have mitigated most, if not all, his/her damages arising from an alleged constructive termination.

Notice Considerations

Where the employer does not prove that the employee was a probationer dismissed for cause, it will be liable to provide notice or compensation in lieu of notice.
If the employment contract is silent on the point of notice entitlements, the common law will imply an obligation to provide reasonable notice based on the usual relevant factors.15
By definition, length of service of a probationer will be short. In these cases, other factors such as recruitment from other employment and the employee's actual period of unemployment will carefully considered by the court and may well result in a significant notice period.
For example, in Lalingo v A & A. Jewellers Ltd.,16 the Court found that the employer had not established a probationary period before the employee was recruited from other employment. It awarded notice of 4.5 months, taking into account an actual period of 9.5 months of unemployment. In Longshaw v. Monarch Beauty Supply Co.,17 the employer's termination decision was not found to be in good faith because it was based on criteria that differed from those established at time of hiring. As there was no just cause, it awarded the probationer a 6 month notice period.
While in many cases, the notice period for a short-service employee will not be longer than a month or two, there is no formula, to limit them as the two above examples show.

Escape Hatch

An employer may avoid the uncertainty of assessing and applying the lower standard of cause for probationers by incorporating a specific notice period in the employment contract. For example, the parties may agree at the outset to a moderate notice period if the employer terminates employment for reasons other than cause during the first three to six months. This would enable the parties to end their relationship at a cost that the employer can presumably afford without arguing over cause. By the same token, establishing a specific contractual notice period for the short term would not affect the employee's longer-term entitlement to "reasonable notice" if the employment ends outside this initial period.18

Conclusions

Cases dealing with probationers do not tend to be litigious as they generally involve short service employees who, in any event, would not have a significant notice entitlement. Where an employer asserts cause to terminate a probationer, it will have to prove the probationary status and the existance of cause. The standard for cause as it applies to probationers is lower than that applied to regular employees. However, from an evidentiary standpoint proving that the employer made "fair, honest and valid assessment" is not an easy task - especially where the measurement criteria are vaguely established or extremely subjective.


1Longshaw v. Monarch Beauty Supply Co. (1995), 15 C.C.E.L. (2d) 232 (B.C.S.C.) where notice was six months.
2Longshaw v. Monarch Beauty Supply Co. (1995) 15 C.C.E.L. (2d) 232 (B.C.S.C.), at p. 240.
3Lalingo v. A & A. Jewellers Ltd. (1997), 27 C.C.E.L. (2d) 211 (Ont. Gen. Div.) where notice was 4.5 months.
4Lalingo v A & A. Jewellers Ltd. ( 1997) 27 C.C.E.L. (2d) 211 (Ont. Gen. Div.) at pp. 216-217 where company policies were not brought to the employees attention prior to hiring.
5R.S.O. 1990, c. E.14 as amended.
6R.S.O. 1990, c. E.14 as amended, ss. 57(1)(a).
7R.S.O. 1990, c. E.14 as amended, ss. 57(1)(a).
8Sometimes referred to as "just cause"
9For a detailed analysis of just cause as it applies to probationers see: Just Cause - The Law of Summary Dismissal in Canada, Echlin, Randall Scott and Certosimo, Matthew, Canada Law Book Inc., 1998.
10(1982), 2 C.C.E.L. 147 (Sask. Q.B.).
11Miguna v. African Canadian Legal Clinic (1996), 18 C.C.E.L. (2d) 131 (Ont. Gen. Div.), at p.135.
12Longshaw v. Monarch Beauty Supply Co. (1995), 15 C.C.E.L. (2d) 232 (B.C.S.C.) where the decision to terminate the probationer was found not to be in good faith because it was made on criteria different from those established at hiring.
13Canadian Employment Law, Ball, Stacey Reginald, Canada Law Book Inc., 1997, p. 11-45.
14Miguna v. African Canadian Legal Clinic (1996), 18 C.C.E.L. (2d) 131 (Ont. Gen. Div.), at p.134.
15Bardal v. Globe & Gail (The), [1960] O.W.N. 253, 24 D.L.R. (2d) 140 (H.C.J.): 1. Character of Employment; 2. Length of Service; 3. Age of the Employee; 4. Availability of similar employment, having regard to the experience, training and qualifications of the employee.
16( 1997) 27 C.C.E.L. (2d) 211 (Ont. Gen. Div.).
17(1995), 15 C.C.E.L. (2d) 232 (B.C.S.C.).
18Slater v. Sandwell Inc. (1994), 5 C.C.E.L. (2d) 308 (Ont. Gen. Div.).


The Six Minute Probationary Employee

Ian Werker, Barrister & Solicitor
393 University Avenue
Suite 2000
Toronto, Ontario
M5G 1E6

Phone: (416) 593-7552
Fax: (416) 593-0668
E-mail: employ@interlog.com

This paper is for general information only. It is not intended to provide legal advice for any particular situation and should not be construed as doing so. If you have any specific legal questions you should contact a lawyer.