Bringing on a new employee is an exciting time for any business. It marks growth, fresh energy, and the hope of a productive working relationship. 

Most employers use a probationary period at the start of permanent employment to ensure it’s the right fit for both the business and the new team member.

The probation period, usually lasting between three and six months (depending on what’s written in the employment contract), allows both parties to settle in. It’s a time to learn the ropes, understand expectations, and assess whether the role and person match.

What the Probation Period Really Means

Although some people think probation is a “trial run,” employees are still entitled to the same benefits as other permanent staff, like sick leave, annual leave, and notice of termination. Probation doesn’t reduce legal entitlements; it’s just a structured timeframe for reviewing performance and suitability.

It’s also worth knowing that the term “probation” isn’t defined in the Fair Work Act. Instead, the law refers to a minimum employment period, which is the amount of time someone needs to be employed before they can make an unfair dismissal claim. That’s 6 months for larger businesses, and 12 months for small businesses (fewer than 15 employees).

Managing the Period Effectively

To get the most out of the probation period, keep the lines of communication open. Regular check-ins, feedback, and support can make a big difference—not only to performance, but also to how welcomed and motivated your new employee feels.

If you feel more time is needed to assess their performance, you may be able to extend the probation, but only if this is clearly allowed for in their contract and agreed upon in writing.

Ending Employment During Probation

If things aren’t working out, you can end the employment relationship during probation. However, notice of termination still applies, and accrued entitlements (like unused leave) must be paid out. And keep in mind: even during probation, dismissals can’t be for discriminatory reasons or breaches of general protections.

If used well, probationary periods can help build the foundations of a successful working relationship and a stronger team overall.