All employers can employ new employees on a 90-day trial period. A 90-day trial period allows the employer to dismiss an employee during the 90-day trial without the employer giving a reason for the dismissal.

90-day trials are definitely useful to have. However, there are a few rules that do trip up some employers. These include:

  • The trial must be part of a written agreement and must be worded correctly (three months is incorrect, it must be 90 calendar days or less);
  • The employee must never have worked for the employer before (not for 5 minutes, nor in another role);
  • The written agreement containing the trial must be signed by both parties before the employee starts work;
  • The trial clause must be entered into voluntarily, following employment negotiations conducted in good faith (which means the employee must be told they can seek independent advice, and must be given a chance to do that);
  • 90-day trial clauses allow for a simplified dismissal process within the trial period and will not protect an employer against other kinds of personal grievances (e.g. for allegations of harassment);
  • Dismissals made in reliance on the 90-day trial clause must be given in writing.

If any one of these points is not got 100% right by the employer, the trial period clause will be invalid and, as no proper process will have been followed to dismiss the employee, a personal grievance for unjustified dismissal may be upheld.

A recent report from the Ministry of Business, Innovation and Employment indicates 90-day trials work well for employers.

The findings of the June 2014 report included:

  • 90-day trials were reducing the perceived risk involved in hiring new people;
  • 90-day trials were not negatively impacting employer-employee relationships;
  • 90-day trials, when used correctly, reduced the costs of dismissals and the risks of new hires;
  • 90-day trials did not usually add any costs for employers; and
  • 72% of employers using 90-day trials had not dismissed any employee under a trial period.

Getting your 90-day trial provisions and processes correct is vital if you want to be able to rely, if necessary, on the arrangement.