Labor and Employment

What Is a Probationary Period and How Does It Work?

By Lisa Guerin, ​J.D., Boalt Hall at the University of California at Berkeley

Employers use probationary periods to coach and evaluate new employees, employees placed in a new position, and employees with performance problems. A probationary period can be a useful management tool, but it can also cause legal trouble. Below, we explain how and when to use probationary periods in a way that won’t land your company in court.

Using Probationary Periods

A probationary period is a stretch of time during which a new or existing employee receives extra supervision and coaching, either to learn a new job or to turn around a performance problem. The probationary period can be as short as a month or as long as a year, depending on the situation.

Employers may require probationary periods for:

  • new employees (in this situation, it might be called an “introductory” period)
  • current employees who are promoted to a new position (particularly if it’s the employee’s first time serving in a supervisory or managerial position), or
  • current employees with significant performance problems.

The purpose of a probationary period is to suspend or modify the usual employment rules for an employee who is learning a job or struggling to perform. For example, let’s say an employee is struggling to complete monthly reports, sometimes handing them in late or failing to include the necessary information. After a couple of coaching sessions, the employee is placed on probation for six months. During this time, the employee will meet with his or her supervisor each week to review progress on the monthly reports and go over questions and concerns. The supervisor will provide detailed feedback and coaching. If the employee can’t improve during the probationary period, he or she will be fired.

Legal Risks of Using Probationary Periods

A probationary period can be a useful coaching tool: It gives an employee some extra time and supervision while learning a new job, and it gives a struggling employee more detailed guidance and a sense of urgency about improvement. However, it can also lead to legal trouble if it compromises at-will employment.

Most employees in this country work at-will. This means that the employer may fire the employee at any time, for any reason that is not illegal (for example, due to race or gender discrimination). However, an employer can lose this right if it makes a promise that isn’t consistent with at-will employment. (To learn more, see At-Will Employment.)

The implied promise (or threat) of a probationary period is that the employee will have the benefit of that stretch of time to learn a new job or improve at an old one. In other words, it could indicate that the employee will have the full probationary period to get up to speed and won’t be fired during that time. Likewise, an employee may expect that he or she will continue to be employed if he or she successfully completes the probationary period. For these reasons, many employers don’t use probationary periods.

If your company decides to use a probationary period, it should take steps to make sure that employees know they can still be fired at any time. All employment documents that reference the probationary period, including the employee handbook, performance appraisals, performance improvement plans, hiring paperwork, and so on, should clearly state that the probationary period does not change the at-will employment relationship. These documents should clearly state that an employee may still be fired for any reason at any time, during the probationary period or after completing it.

Tips for Successful Use of Probationary Policies

As noted above, the most important way to protect your company’s rights when using probationary policies is to note in all documents that employment is at will, even for employees who are on probation or who have completed probation. Here are some other steps you can take, to ensure both that your company doesn’t take on unnecessary legal risks and that the employee has the best opportunity to learn the job or correct performance problems:

  • Be clear about your expectations. Notify the employee of the probationary status, how long it will last, and what needs to happen or change during that time. Will the employee meet with you every week? Will the employee need to hit certain performance milestones?
  • Give feedback regularly. Conduct periodic reviews with the employee to provide feedback and counseling. If the employee is having performance issues, give detailed guidance on how the employee can improve—and offer training, if necessary.
  • Get help for the employee. Assign a knowledgeable and experienced mentor to advise the employee. If the employee needs training or other resources, make sure they are provided.
  • Get feedback from your human resources department. HR can help you make sure you are treating the employee fairly and consistently. For example, if you place a struggling employee on a one-month probationary period but most other managers give employees three months to improve performance, you’ll want to make sure you are giving the employee a fair chance to turn things around.
  • Document everything. If an employee can’t do the job or improve performance, you’ll likely want to terminate the employment relationship. To avoid legal trouble, clearly document everything during the probationary period: the employee’s performance, your efforts to coach and manage, any training provided, and so on. This will leave you on safe legal ground if you decide that the employee isn’t going to make the cut.
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