The Financial Times reported last night that 

Companies will be able to keep new hires on probation for up to six months under a compromise Labour plan despite an election pledge to give employees “day one rights”

It seems there has a been a ‘lot of back and forth’ between Angela Rayner and Business Secretary Johnathan Reynolds about how long probation periods should be with the latter favouring a longer period and the Deputy PM preferring an even shorter one. A Whitehall source is quoted as saying “its a decent compromise”

Personally I am surprised that ministers have spent any time at all thinking about this. Six months is – by some margin – the most common probationary period I have come across. Encouraging employers to operate a longer period would hardly seem in keeping with the principle of day-one rights and a shorter period which undercut arrangements already in place and would have struck many businesses as unfair. If a probationary period is going to be provided for in the forthcoming Employment Rights Bill, then six months is the obvious duration to go for. 

Back in September last year I predicted that Labour would probably end up introducing a qualifying period of six months. Since that could be done by Regulations (see this post) it would be a quick and easy change and would reflect most probationary periods already in place. 

But it does not look like this is what Labour is proposing. Unfair dismissal will become a day-one right – the manifesto is quite clear on that – but there will be provisions specifically dealing with dismissals during a six month probation period. 

The big question is what the position during probation will be. I can think of a number of options. 

Option 1 – If an employee is taken on with a probationary period then any dismissal during that period will be held to be fair.

Option 2 – Provided any dismissal is shown to be for the reason of capability or conduct then a dismissal during the probationary period will be held to be fair.

Option 3 – In deciding the fairness of a dismissal the Tribunal will be required to take into account the fact that the dismissal took place during a probationary period.

Option 4 – A specific procedure will be set out for the operation of a fair probation period and the fairness of any dismissal will depend on whether or not the employer has followed that procedure. 

Personally I would go for Option 3. It would be easy to draft (Johnathan Chamberlain of Gowling WLG has helpfully shown how) and would allow for common sense. Option 1 is really no better than just having a six month qualifying period and Option 2 would deem blatantly unreasonable dismissals to be fair. 

Option 4 would be an abomination. Anything but Option 4. I shouldn’t even have suggested it in case someone reads it and thinks it’s a good idea. If Option 4 happens I will stand outside Parliament with a loudspeaker like an employment law version of Steve Bray. Those of us who remember the statutory dispute resolution procedures will shiver at the prospect of Option 4. Forget I mentioned it. 

Option 3 seems to me to be the way to go. It fulfils the manifesto commitment because it clearly makes unfair dismissal a proper day-one right while allowing employers to assess employees during probation and make a reasonable decision as to whether they should be kept on or not. The Financial Times quotes Matthew Percival of the CBI as calling for ‘only a light touch approach’, but in unfair dismissal cases a light touch is already baked into the test of reasonableness. I don’t think it is too much to ask employers to behave reasonably when operating probation periods. It is easy enough to see how that would work. Tribunals would be likely to look for

• transparency about the process,
• reasonable communication and an opportunity to improve
• a decision based on an honest belief that the employee is unsuited to the work
• reasonable grounds to back up that honest belief

Specifically directing Tribunals to take probation into account may not be strictly necessary – they would do that anyway – but there is nothing wrong with adding something to that effect in the test of unfair dismissal. It has been done before. One thing I particularly like about the wording that Johnathan Chamberlain came up with is that he added the reference to probation immediately after a requirement that Tribunals take into account the ‘size and administrative resources of the employer’s undertaking’. Those words were added by the Employment Act 1980 soon after a new Conservative Government came into power. Giving tribunals a bit of a steer by requiring them to look at particular factors, but without undermining their ability to make a judgment about fairness, has a long history.