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How to Terminate an Employee During Probation

Termination

11 Dec 2023 (Last updated 3 Sept 2025)

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‘Probation’ is not a term used by the Fair Work Act 2009 (the Act). The Act refers to a Minimum Employment Period which is determined by the amount of time the employee has worked in the business and the size of the business. The minimum employment period is the minimum period that an employee must be engaged in the business before they may have access to an unfair dismissal claim if you terminate their employment.

For a small business with less than 15 employees this is 12 months, otherwise it is six months. During the minimum engagement period an employee may be terminated subject to written notice in accordance with the relevant provisions of the NES, the applicable industrial instrument or their employment contract. 

Many consider it is best practice for an employer to have a policy in respect of managing and possibly terminating employees during their probationary period. The first step, before the employee even starts work, is drafting an employment contract that clearly states the length of the probationary period including the start and the end dates, and specified in what circumstances the probation may be extended and how long for.

In the first week of employment, it is considered best practice to tell the employee what you expect of them in terms of skills, tasks, deadlines, and conduct.

Dismissing an employee during their probation period

Before the probationary period ends, you should meet with the employee and let them know whether they have passed probation. If they are unsuccessful, you can extend their probationary period if the contract, award or registered agreement allow for it or end their employment.

If you are ending their employment, it may be considered best practice to meet with the employee to provide feedback about their performance or conduct and explain why the probation period was unsuccessful.

Under the National Employment Standards set out in the Fair Work Act 2009, you need to give an employee written notice to end his or her employment. The written notice should specify the period of notice given (or payment in lieu of notice), and the date the employment will end. If they are outside the minimum engagement period, an additional process will be required. Call the Fair Work Helpline for Employers by Peninsula for free initial advice on terminating an employee outside of the minimum engagement period on 1300 651 415

Always confirm the outcome of the meeting in writing to the employee whether they are successful or unsuccessful, and whether you are extending the probation or are terminating their employment, and  keep a copy as well as a written record of the discussion during the meeting.

Valid reasons for termination

If you choose to terminate an employee during probation it is best to, always provide a reason that can be supported with evidence if required.    

If the probation period has gone beyond the minimum employment period, the Fair Work Commission has determined that you should not dismiss any employee without a valid, sound, and defensible reason given the circumstances, and a fair dismissal process, in order to minimise the risks of a subsequent unfair dismissal claim. Valid reasons are varied and fall under four key areas:

  • Capacity – if the employee lacks the ability, or is incapable, of completing the inherent requirements of their role
  • Performance – if the employee’s skill level or quality of work is below what is required for the job, or if they are not meeting the standards outlined in their employment contract due to a lack of care or diligence;
  • Misconduct when an employee partakes in behaviour that is out of line with company policy, goes against the terms of an employment agreement, or is unlawful; or
  • Redundancy when an employer either decides they no longer need an employee’s job to be done by anyone, or the employer becomes insolvent or bankrupt.

Other reasons for dismissal may be valid if the employee does not have access to an unfair dismissal claim, provided those reasons don’t give rise to a general protections claim.

The Fair Work Act 2009 provides protection from dismissal for employees in various circumstances, including in relation to workplace rights, industrial action and discrimination, amongst others.

Notice and warning

Employees who are on probation have the same entitlements as a permanent full-time or part-time employee including wage entitlements, sick leave, annual leave, and notice. So once you have decided that you do not wish to continue their employment you should meet with the employee to inform them of the reasons that their probation is unsuccessful. You are required to give the employee sufficient written notification of the day their employment will end. The notice period varies, depending on how long an employee has worked within the business, and the applicable industrial instrument or employment contract. 

The employee can either work during the notice period or alternatively the employer must make payment of the notice in lieu, which is to be included in the employee’s final pay along with any other entitlements owing, which may include, but is not limited to, outstanding wages and unused (annual) leave entitlements.

Notice is paid at the employee’s full pay rate as if they had worked the minimum notice period, so payment in lieu of notice can include incentive-based payments and bonuses, loadings, allowances and overtime or penalty rates.

General protection and discrimination risks when dismissing an employee

The Act provides that an employee on probation can only bring an unfair dismissal claim after employment for a minimum of six months or 12 months for a small business employer with fewer than 15 employees at the time of the dismissal.  

In most cases, probation periods rarely go beyond six months. However, as an employer, it’s essential to keep the minimum employment period in mind when you decide to extend a probationary employee’s period of employment. If you extend the period of employment beyond the minimum employment period of six months or 12 months for a small business employer, and then terminate an employee, the employee may bring an unfair dismissal claim. This is different to a general protections claim.

An employee may be able to initiate a general protections claim regardless of the length of their employment if the dismissal is for a prohibited reason, so due to discrimination based on race, age, gender and other such attributes, or because the employee exercised a workplace right, for example.

Prohibited reasons include dismissal due to discrimination based on: 

  • Age
  • Disability
  • Gender
  • Marital status 
  • Pregnancy
  • Race
  • Religion
  • Sex and sexual orientation 

Employers cannot terminate employees for protected reasons whilst they are on probation, for example because they filed a work complaint, acted as whistleblowers, or made an enquiry as to their pay. 

As this is a complex area, it may be prudent to call us for free initial advice if you are considering terminating an employee during their probation period.

Contact Peninsula for free initial advice to help you manage your business and your new employees, to keep track of performance issues and employee entitlements.  

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Termination

How to Successfully Manage Offboarding

The Australian Bureau of Statistics reported that 2.3 million Australians had left or lost a job from Feb 2022 to Feb 2023. This is the highest job mobility rate the country has seen in over a decade. The sheer number of employees parting ways with Australian employers leads to an important question – how effectively are businesses managing their offboarding process?   When an employee leaves a company without undergoing an offboarding process, an opportunity to improve the business walks out of the door with them.  Are you keen to avoid missed opportunities? Read on to discover the often-overlooked benefits of offboarding and get practical tips for improving your company’s exit process.   What is offboarding?  Offboarding is a formal procedure a business follows before an employee leaves the company, whether because of resignation, redundancy, dismissal, or retirement. Having a well-defined offboarding process is important because it ensures a smooth transition for the employee, the employer, and the person who steps into the vacant role. Depending on the employee’s role and responsibilities, the offboarding process can be highly complex and may take several weeks or months to complete. We’ll explore the end-to-end process and its most important components in more detail below. What is the difference between onboarding and offboarding?  These two terms are analogies referring to an ocean voyage, which involves onboarding and offboarding a boat. In a workplace setting, these terms refer to the beginning and the end of an employee’s journey with a company. Onboarding is the process of welcoming and integrating a new employee into a company. It includes induction  tasks such as providing the employee with an overview of the company, introducing them to their new colleagues, and giving them training specific to the tasks and responsibilities of their role.  Naturally, offboarding is the opposite. It involves collecting company equipment, revoking access to company accounts, and conducting an exit interview to gather feedback about the employee’s experience. Why is offboarding important?  Offboarding is important because it helps to ensure that the employee’s departure is smooth and orderly. It also ensures all their work is properly transitioned to a replacement with minimal impact on productivity.  It also gives employers and employees the opportunity to end the relationship on a positive note, preserving networking opportunities which may prove valuable further down the track.  Crucially, offboarding gives employers a chance to find out how the company experience can be bettered for current and future employees. When it comes to building better staff retention, a well-planned offboarding process is one of the handiest tools in your box. Why do so many businesses overlook the offboarding process?  While most companies see the value of perfecting the onboarding process, and often invest in it heavily, they’re less likely to pay attention to the quality of their offboarding. This means offboarding is normally the missing piece in the employee lifecycle. This leaves departing employees feeling disconnected and undervalued.   Why? Good question. Here are a few reasons why so many businesses overlook offboarding:  It’s not seen as a priority: Many businesses view offboarding as a simple matter of processing paperwork and removing access to systems. As a result, it often gets pushed to the bottom of the to-do list.  It’s time-consuming: Offboarding can be a complex process, especially for large organisations. It involves collecting equipment, updating records, and managing security risks. This can be a lot of work, especially when HR teams are already stretched thin.  It’s uncomfortable: Some businesses may avoid offboarding because it involves difficult conversations, such as exit interviews. They may also worry about upsetting departing employees, especially if they are leaving under negative circumstances.  No matter how time-consuming or awkward an offboarding process might be, make sure you follow it with every departing staff member.   To return to the ocean voyage analogy, neglecting offboarding and making an employee’s last days a painful experience is a little like asking them to walk the plank!  How does offboarding help businesses?  1: Minimise disruption to the business  A well-managed offboarding process can help to minimise the disruption caused by an employee’s departure. It can help you understand what responsibilities and tasks need to be picked up by somebody else (don’t make the mistake of assuming you know everything the employee’s been doing from day-to-day!).  This will also help you figure out what skills and qualities you need when you’re recruiting for the vacant role. When you do find the right replacement, you’ll be in a stronger position to train them for the demands of the role. 2: Protect company assets and data  The offboarding process provides an opportunity for businesses to collect company equipment and to revoke access to company accounts. This helps to protect the company’s assets and prevent data from being misused. Essentially, offboarding ensures there are no loose ends. For example, you won’t find yourself emailing a former employee weeks later asking for his or her office access card.    3: Gain valuable feedback  The offboarding process is a good time for businesses to conduct exit interviews with departing employees. Offboarding presents a rare opportunity for employees to be completely honest about the good, the bad, and the ugly with their experiences at your company. Exit interviews can provide businesses with valuable constructive feedback about their culture, policies, and procedures. Acting on feedback is a great way for businesses to make strategic adjustments that improve the employee experience and reduce staff turnover.    4: Improve the role  Unnecessary obstacles and blockers can often factor-in to an employee’s decision to move on from their role. These obstacles can be internal or external and range from minor inconveniences to major roadblocks. In this situation, you can make changes that simplify the role for whoever picks it up. As well as making life easier for new employees, routinely actioning these kinds of improvements will increase efficiency throughout the entire business.  5: Build your brand reputation  It sounds a little corny, but your brand’s reputation really is priceless. If an employee has a positive experience with your company, they might tell a handful of people. If an employee has a bad experience, they’re likely to tell the world.  In an era of workplace review sites like Glassdoor, Indeed and Seek, a poor offboarding experience can put a serious dent in your brand reputation. If you want to attract top-level talent, nail your offboarding process and ensure staff leave on a high. A pro tip for offboarding   Job seekers are turning to Glassdoor like bees to honey, with Software Advice Study finding that over 50% are checking a company’s reviews before applying. And why not? No one wants to waste their precious time applying for a job at a company with a reputation for being a nightmare.  In fact, nearly 50% of job seekers check Glassdoor reviews before doing any other job search activity. So, if you want to attract top talent, make sure your Glassdoor reviews are stellar. The surest way to do this is to master your offboarding and make sure your staff leave you a glowing review.  You should also respond to both positive and negative reviews on Glassdoor. This shows potential employees that you’re listening to feedback and committed to actively improving your company culture.  How does offboarding help employees?  As well as benefiting businesses, a solid offboarding process can be a boost for your employees too. The positives include:  Leaving on a positive note: A well-managed offboarding process can help employees to leave the company on a positive note. This is because the business will have taken the time to say goodbye to the staff member and thank them for their contribution.  Getting closure: The offboarding process can provide employees with an opportunity to get closure on their time with the company. This can help them to move on to the next stage of their career.  Receiving support: The offboarding process can provide employees with support as they transition to their new role or to unemployment. This support can include things like providing them with references or helping them to develop a resume, cover letter and portfolio. Naturally, this is especially important when staff are made retrenched or made redundant.   What are boomerang employees?  Don’t overthink it, boomerang employees do exactly what a boomerang does – they come back!  Boomerang employees are employees who leave a company and then return to work for the same company at a later date. Companies like boomerang employees for several reasons:  They are already familiar with the company culture and processes. This can save the company time and money on onboarding and training.  They are often more productive than new hires. Boomerang employees already have a good understanding of the company’s products and services, and they have a track record of success at the company.  They can bring new ideas and perspectives. Boomerang employees have often had experience at other companies, which can help them bring new ideas and perspectives to their old company.  In addition, boomerang employees can be a sign that a company has a good work environment and culture. Employees are more likely to return to a company that they enjoyed working for in the past.  What does a good offboarding process look like?  A good offboarding process is one that is well-structured and covers all bases. It should be clear to both the employee and the manager what needs to be done and when it needs to be done by. The offboarding process should also be flexible enough to accommodate the individual needs of the employee.  10-step offboarding checklist  Stay in communication: Don’t abandon them just because they’re leaving. Early in the process, send an offboarding email outlining the process for the final weeks. Stay closely involved throughout the process, offering support and guidance.  Capture institutional knowledge: Before your employee goes, work with them to document their workflows, processes, and relationships. This will help ensure that their work is transitioned smoothly to their replacement.  Stay on top of administrative tasks: Offboarding requires a lot of paperwork and administrative tasks. Check in with your HR and legal teams to confirm they have everything they need, from resignation letters to non-disclosure agreements.  Collaborate on a staff announcement: Write a coordinated statement with your employee to announce their departure. This gives them the opportunity to say goodbye to their colleagues in a way that feels right to them.  Set up an exit interview: Exit interviews provide valuable feedback on the company culture, employee experience, and areas for improvement. Encourage your employees to be as honest and open as possible with their feedback.  Develop a temporary plan: If there’s no new hire to replace your employee right away, you’ll need a temporary plan to cover their work. This may involve delegating tasks to other team members or deferring non-essential work.  Hire a replacement employee: Start the hiring process as soon as possible so that you have enough time to find the right person for the role. If possible, overlap the new hire’s start date with the departing employee’s end date so they can collaborate on a seamless transition.  Revoke access to company accounts: The manager should revoke the employee’s access to company accounts, such as email, social media, and customer relationship management (CRM) systems. This should be done on the employee’s last day of work.  Collect company equipment: The employee should return all company equipment, such as laptops, phones, and building access cards.   10.Stay in touch: As much as possible, make sure you keep in contact with your old employees once they’ve left. You never know when you might benefit from maintaining the relationship. Plus, the warmer you are toward them, the more likely they are to act as brand ambassadors. Final notes on offboarding  As well as helping you complete all the important paperwork and collecting company equipment, offboarding is a bit like saying goodbye to a friend. 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Termination

Can You Terminate a Whistleblower?

Whistleblower is a term you’ve probably encountered in the news or the media. Edward Snowden or Julian Assange might come to mind when you think of a whistleblower. While these examples may seem far off from your world, as an owner of a business, of any size, you should be aware of whistleblower protections and how they may affect your business. In short, a whistleblower is someone who highlights unethical or illegal behaviours that occur at work, this could include but is not limited to; fraud or behaviour that places an individual’s safety at risk. This may be in relation to your business’ practices, or the conduct of an employee in your business. This blog is intended to give you an initial idea of what a whistleblower is, the legal protections in place, and other things you may want to know about this topic. What is a whistleblower? In legislation, a whistleblower is someone within, or with a connection to, a company or organisation who raises concerns or questions about ‘misconduct’ or  ‘improper states of affair’ within that same organisation. Misconduct or improper states of affair will depend on the circumstances, however, can include behaviours such as theft, fraud or gross mismanagement. This will also include information about the company or organisation, or an officer or an employee of the company or organisation, engaging in conduct that: breaches the Corporations Act 2001; or breaches other financial sector laws enforced such as the Australian Securities and Investments Commission (ASIC) – for more information please seek professional advice; or breaches against any other law of the Commonwealth that is punishable by 12 or more months imprisonment; or represents a danger to the public or financial system. Whistleblowers can include current or former employees, officers, contractors and superannuation trustees. Spouses and relatives of these individuals are also covered under the whistleblower ‘protection regime’. Why are whistleblowers important? Whistleblowers play an important role in identifying and calling out potential harm to consumers and the community. Under whistleblower protection legislation, a whistleblower must have ‘reasonable grounds’ to suspect that the information they are disclosing about the company or organisation concerns: misconduct; or an improper state of affairs or circumstances. Note: Misconduct will not be limited to misconduct as defined by your own policies and should be considered more generally.    Which laws protect whistleblowers? The Corporations Act 2001 grants certain individuals legal rights and protections as whistleblowers. These protections include: Whistleblower’s identity must not be disclosed under any circumstances without their consent or authorisation. In certain circumstances, however, information can be distributed to ASIC, Australian Prudential Regulation Authority (APRA) or a lawyer. Whistleblowers are protected from being summoned to court for making the disclosure including if that disclosure is in breach of their contract of employment. It is a criminal offence to victimise or cause detriment to a whistleblower because of their disclosure and civil penalties may apply. Individuals can seek compensation through a court if they suffer loss, damage or injury for making their disclosure. What are the risks associated with terminating a Whistleblower? Possible risks associated with termination of a whistleblower could include, but are not limited to: General protections claim: The Fair Work Act 2009, protects individuals from adverse treatment for actions like exercising a statutory right to make a complaint or inquiry about their work conditions, environment or employer. Therefore, terminating an employee, for speaking out could be against the Fair Work Act 2009 and could result in the employee lodging a costly and drawn out claim against you and the business. Negative effect on workplace culture and employee morale: Employees who witness poor treatment of colleagues, may be less inclined to make reports of future poor behaviour or processes within a workplace. It is recommended that you seek professional advice, and plan carefully to help mitigate unwanted negative effects on other staff, organizational culture, and consider unwarranted publicity or reputational damage. Possible reinstatement: In certain circumstances, an employer may be ordered to reinstate an ex-employee into their original position or a comparable position within the organisation. Apology to whistleblower: In certain situations, the person, company or organisation that caused detriment or made a threat may be ordered to apologise formally. Whistleblower policy in Your workplace 1.Implementing a Policy Only certain companies are required to have a whistleblower policy by legislation. However, business owners should still ensure whether their business fits these requirements. If you are required to have a policy in place, it must contain information about: the protections available to whistleblowers; how and to whom an individual can make a disclosure; how the company will support and protect whistleblowers; how investigations into a disclosure will proceed; how the company will ensure fair treatment of employees who are mentioned in whistleblower disclosures; and how the policy will be made available. 2.Give Staff Training Although not a requirement, businesses which are required to have and identify how they will communicate a whistle blower policy, should consider training their staff in the policy. Best practice training will include education for senior managers, offices and others authorised by the company to receive disclosures from whistleblowers (e.g. Compliance officers), and how their roles may specifically intersect with legislation. It will also include training all staff on the whistle blower policy. This program should go cover the basic of the legislation, as well as how your whistleblower policy operates within your business. Get total HR and WHS support Peninsula has worked with Aussie businesses for years, providing them with tailored HR and WHS advice and resources. Our team works with you to find solutions that work for your business and employees. Chat with us today to find out how we can help you.

Termination

Can You Terminate an Injured or Sick Employee?

Terminating an employee due to injury or illness is a complex area fraught with legal, ethical, and human resource challenges. In Australia, the legal framework surrounding this issue is designed to protect both the rights of employees and the operational needs of employers.   This article delves into the key considerations and legalities of terminating an injured or ill employee, with a focus on NSW and workers' compensation implications.  Understanding the legal landscape  In Australia, employment laws strictly regulate the termination of employees, especially those suffering from injury or illness. The Fair Work Act 2009 and state-specific legislation like the Workers Compensation Act 1987 (NSW) provide a clear framework that employers must navigate carefully.  Terminating an injured employee: the considerations  Terminating an injured worker is a delicate and legally complex matter. While you might face justifiable business concerns, navigating this situation ethically and within the bounds of Australian law is paramount.  Fair Work Act protections The Fair Work Act prohibits dismissal on the grounds of an employee's temporary absence due to illness or injury. This is provided the absence is supported by appropriate medical evidence and does not exceed three months, or a total of three months over a 12-month period.  Workers’ compensation in Australia  Workers' compensation is a mandatory insurance scheme that provides financial support and medical care to employees injured or sickened because of their work. Workers' compensation legislation differs across states and territories, but in general, employers must purchase workers' compensation insurance to cover themselves and their employees.   Workers' compensation benefits include things like expenses for medical treatment, lost wages, permanent impairment, and death benefits. Terminating an injured employee on workers' compensation is illegal unless there are exceptional circumstances like redundancy. Workers’ compensation in NSW  Employees on workers' compensation in NSW are further protected. The Workers Compensation Act states that you cannot dismiss an employee within six months solely because of their injury or incapacity to perform work resulting from a workplace injury. Beyond six months, dismissal of an injured employee is permissible only once the employer has fulfilled all responsibilities towards the employee.  Genuine operational reasons  Employers must demonstrate that any decision to terminate is based on genuine operational requirements of the business and not the employee's incapacity. This might include the inability to adjust the work or provide suitable duties after reasonable adjustments have been considered. Consultation and support  Before making any termination decision, employers should consult with the employee, review possible workplace adjustments or alternative positions. Documentation and communication  Maintaining transparent communication and thorough documentation throughout the process is vital. This includes keeping detailed records of consultations, medical assessments and any efforts made to accommodate the employee's condition. Explore alternatives to termination  If the injured worker can't return to pre-injury duties, this could include modified duties — performing adjusted duties with less physical or mental demand — redeployment, flexible working arrangements, rehabilitation programs to support the employee's return to work or utilising accrued leave entitlements, including sick leave, annual leave or personal leave, to cover the absence.   Risks of unlawful termination  Terminating an employee without adhering to the legal and procedural requirements can lead to claims of unfair dismissal, discrimination or breach of employment contracts. These cases may be referred to the Fair Work Commission (formerly the Industrial Relations Commission). Employers in NSW must be mindful of the potential legal implications and the importance of proceeding with caution and due diligence.  Best practices for employers  Running a small business comes with its fair share of challenges, and navigating employee illness or injury can be particularly tricky. Here are some best practices for striking the right balance between supporting your people and maintaining business continuity.   Develop clear policies and procedures  Establish well-defined guidelines outlining sick leave, workers' compensation claims and return-to-work processes. Ensure policies are readily accessible and easily understood by all employees and stay updated on relevant workers' compensation legislation and workplace safety regulations.  Train managers on legal requirements and sensitive communication  Equip managers with the knowledge and skills to handle sensitive conversations about illness, injury, and performance concerns. Train them on legal requirements, fair dismissal principles and respectful communication practices.  Build a positive and supportive workplace culture  Promote empathy and understanding towards employees facing health challenges. Implement programs to promote employee well-being and mental health and encourage a culture of mutual respect.  Prioritise communication and compassion  When dealing with injured workers, it is best practice to approach the situation with empathy, maintain open lines of communication, and explore all possible options to retain the employee within the organisation.  Seek legal advice  Given the complexity of employment and workers' compensation laws in Australia and NSW, seeking legal advice is prudent. This ensures any actions taken are compliant and in the best interest of both the employer and the injured employee.  Empowering employers with knowledge and support  Understanding your obligations and the rights of your employees is crucial when facing the challenging decision of terminating an injured or ill employee. By adhering to legal requirements and adopting a compassionate approach, employers can navigate these situations with integrity and fairness.  Need guidance on terminating an injured or ill employee?  Terminating an employee due to injury or illness requires careful consideration and expert guidance. Peninsula is dedicated to supporting Australian businesses through complex HR and legal challenges.  Contact Peninsula today for comprehensive advice on managing terminations ethically and legally while upholding the dignity and rights of your employee. 

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