In New Zealand, as with any country in the world, employers and employees start off their relationships tenuously. Employers do their best to screen and select the very best candidates for their open positions.

However, how do they know if employees represent themselves accurately and actually have the skills and dedication to perform their jobs well? Employees research their new employers, but they can’t know accurately what it will be like to work at new companies until they’ve tried it. This is why probation periods are so important.

This guide will let you know how probationary periods in New Zealand are used and the regulations that define them in this country. This will help you understand your obligations toward your new employees or employer.

Definition of a Probation Period in New Zealand

A probation period in New Zealand starts when a new employee begins working for their employer. It is a pre-agreed time within which the employer and the employee assess their new working situation and make a final decision on whether or not it will work out long-term.

The employer attempts to confirm whether or not the employee possesses the skills and aptitudes they claimed during the application process. They also look at their ability to adapt to their new team and working environment. If the employee does not seem to fit well or be able to perform their tasks satisfactorily, the employer may choose to terminate them.

At the same time, the employee tries out their new role and responsibilities. They look at how well they can work with their team and the overarching company culture. They may decide that the position is not a good choice or that their working conditions are not as promised. In this case, they may choose to resign.

If neither the employer nor the employee terminates the employment agreement by the end of the probation period, the employment continues, and the employee becomes a permanent worker.

Lengths of Probationary Periods in New Zealand

Probationary periods in New Zealand can be of any duration. They are not mandatory, and there is no legislated minimum or maximum length of time they can last. However, their lengths have to be stated in employees’ contracts so the employee is informed beforehand.

Some probationary periods are, however, influenced by collective agreements and cannot last longer than these agreements allow. New Zealand also distinguishes trial periods from probationary periods.

Trial periods are similar but can only last a maximum of 90 days. Whether this length or shorter, their durations also must be stated in employee contracts.

Legal Considerations of Probation Periods in New Zealand

Employment in New Zealand is regulated by several legal instruments, most importantly the Employment Relations Act 2000 (ERA). This act outlines the rules for both probationary periods and trial periods and defines the obligations of both employers and employees.

Pay and Working Conditions

The ERA is very clear on the pay and working conditions employers must provide. Workers cannot be paid less during either trial or probation periods than their contractually agreed wages.

Their working conditions must also be the same. They cannot be asked to work longer hours or perform more overtime than permanent workers.

New Zealanders normally work 40 hours a week, and while overtime isn’t limited, the possible hours of overtime expected and the rate of overtime pay must be written into contracts.

Termination and Notice

Probationary Periods: Probationary workers cannot be dismissed without cause. Employers are obligated to let them know how they’ll be assessed in their work. Employers must make an effort to assess workers, provide them with feedback, and give them opportunities to improve.

If, however, the employer feels that the probation has failed, they can give the employee notice of termination and explain the justification behind the decision. The notice given should match the minimum provided for in the employee’s individual contract or in a relevant collective agreement.

Trial Periods: Trial periods are short and are used to test out the fit of new workers. Employers can dismiss workers at any time during or at the end of trial periods without providing justification. However, they still need to provide notice as agreed in the employee’s contract or roughly two to four weeks which is considered a reasonable amount of notice.

For both trial periods and probationary periods, New Zealand workers are free to resign at any time. They do, however, need to provide their employers with notice according to their contracts.

Vacation / Holidays

There are 11 public holidays each year in New Zealand. These days are paid holidays to which all workers are entitled equally, whether they’re trial, probationary, or permanent employees. If they must work on these days, employees must receive alternative paid days off instead.

New Zealanders are entitled to at least 20 days of vacation leave each year. However, they don’t receive this allocation until they’ve completed one full year of work. This means that most trial and probationary workers cannot take vacation leave.

Benefits of Probation Periods in New Zealand

Both trial and probationary periods in New Zealand can be very useful for employers but are also beneficial to new employees as well. Some of the advantages gained in using these periods include:

  • For Employees

Chance to receive extra attention and assessments from the employer to help them develop and improve.

Ability to resign easily from a job that’s not working out.

  • For Employers

Opportunity to dismiss workers whose performance is not satisfactory, with no justification needed in the case of trial periods.

Ability to motivate employees to prove their abilities and develop their skills quickly.

Frequently Asked Questions

No, these periods are not mandatory, and employers can choose whether to use them or not. If they choose to, however, they must be clearly detailed in workers’ contracts.

Yes, during a trial period, an employer can dismiss a worker without providing a justification. However, probationary workers can only be dismissed for just cause, including unsatisfactory performance.

Trial periods are limited to 90 days, while probation periods have no mandated maximum length. However, most probation periods last between three and six months.