There’s a week to go on a probationary period and concerns get raised for the first time that someone might not be right for the role…. Sound familiar? The NSW Industrial Relations Commission (IRC) has sounded a warning for the NSW public sector to assess the conduct and performance of new employees during the probationary period, and ensure they confirm the appointment of those employees, or dismiss them, prior to the probationary period ending.

What happened?

The practical implementation of probationary periods has to be considered by NSW public service employers in the wake of the IRC decision in Wilson v Industrial Relations Secretary (Wilson). The key takeaway from Wilson is that public service employers concerned about the conduct or performance of a probationary employee must either act to dismiss before the probationary period ends, or extend the period. What happens if neither of these occur? Well, the IRC says that it will be assumed the employee has successfully completed the probationary period. Of course, this means that the employee could then pursue claims such as unfair dismissals and disciplinary appeals if they are dismissed or disciplined at some later date.

The facts

Mr Brock Wilson brought a disciplinary appeal in the IRC against a decision by a NSW public sector employer to terminate his employment.

The IRC was asked to consider whether it had jurisdiction to determine the appeal because, although Mr Wilson had served his six-month probationary period, his employment had not been confirmed under rule 5 of the GSE Rules. The employer argued that, without express confirmation of Mr Wilson’s employment, he remained on probation and was unable to bring a disciplinary appeal to challenge the termination of his employment.

Mr Wilson argued that, at the end of his six-month probationary period, his employment was not terminated, and the probationary period wasn’t extended either, so it should be inferred or assumed that he had completed his probation and his employment was confirmed under the GSE Rules. In other words, the fact he remained employed and continued to be paid meant it was fair to assume he had completed his probation.

The Decision

The IRC looked back at the history of the law relating to probationary periods for NSW public servants, going as far back as 1895. A key observation of the IRC was a change in the wording of the probation provisions in the GSE Rules compared with the PSEM Act. Under the PSEM Act, employment could be confirmed “after” the period of probation expired. Now, the GSE Rules state that the decision must be made “at the end of” the probationary period.

The IRC did not accept that probationary periods could be automatically extended indefinitely until the employer actively ‘confirmed’ the employment. Extending a probationary period requires employers to take a positive step, including notifying the employee of the extension. No such steps were taken in this case.

As Mr Wilson’s employment was not terminated, and the probationary period was not extended at the end of six months, the IRC said that it must be inferred that he had satisfied the requirements of the position, and that his employment had been confirmed. The consequence was that the IRC could then hear his disciplinary appeal.

What do we learn from this?

While this may seem like a niche point, it is something that comes up time and time again, as administrative processes for dealing with impending end dates of probationary periods fail, or are delayed until after it is too late.

In case there was any doubt, Wilson confirms that NSW public sector employers cannot continue to rely on the historical approach of employees just remaining on probation indefinitely until the employer ‘confirms’ or ‘annuls’ their employment, even if that doesn’t happen until long after the probationary period should have ended.

The GSE Rules now provide that the employer may, at any time during or “at the end of” the probationary period, confirm or terminate the employment. Unless the probation period is clearly extended before it ends, and the employee is told that it’s being extended, then when the period ends, that’s it. Probation completed. No second chances.

So how is this addressed from a practical perspective? All employers should diarise key dates during employees’ probationary periods to allow time for conduct and performance to be assessed. For NSW public sector employers, there also needs to be enough time factored in for the relevant decision-maker to decide whether to extend the probationary period, terminate the employee or confirm employment, and communicate those decisions to the employee, well before the probationary period expires. This requires systems and education for those responsible for managing new employees.

The specialist agencies in the government sector are not immune from this decision. The same wording that is used in rule 5 of the GSE Rules is found in the equivalent provisions that deal with probationary periods for:

• NSW Health Service senior executives;
• Administrative employees of the NSW Police Force (both executives and non-executives); and
• Transport Service senior executives.

However, differently worded provisions are used for people employed in the Teaching Service, police officers appointed to the NSW Police Force, and some members of the Transport Service. Accordingly, the decision in Wilson may not apply to them.

The lesson here is relevant for all employers in all industries. The six month ‘qualifying period’ for unfair dismissal claims, which usually corresponds with a probationary period, cannot be extended just because an employee’s performance is still under review. The same systems and education for persons managing new employees should be implemented.

Martin Watts
Partner
+61 2 9169 8408
[email protected]

Kathleen Weston
Lawyer
+61 2 9169 8415
[email protected]