Whether you are a charity or a business; whether you are a sole trader, limited company, CIO or CIC, getting your HR wrong can cost you big time both in terms of money and reputation. I saw an article today sent to me by Kathryn Rogers of face2facehr.com which with her permission I reproduce in full as it is a typical example where something so simple can have such a disproportionate effect.

"The issue

Our client had an employee who hadn’t performed well during his three-month probationary period, and the client had been very back-and-forth about whether to extend the probationary period or to terminate and cut their losses.

When the time came, due to the manager being busy and the employee having a period off sick, the end of probation meeting did not actually take place until three weeks after the three-month anniversary of the individual’s starting date.

The manager terminated the individual’s employment however the issue was that the amount of notice required was only one week during probation, increasing to one month after probation had been completed. The employee insisted they were entitled to one month’s notice.

Our advice

The question here was whether probation could be deemed to have been automatically come to an end (and therefore ‘passed’) on the anniversary of the start date, even in the absence of any confirmation. We advised that the wording of any contract clause or relevant policy was key to this question.

This client had a clause in their contract which was phrased in such a way that it was clear that successful completion of probation would be specifically notified. As this had not happened, and as the meeting had only slipped due to various circumstances (rather than not taking place at all), we advised that the client could give a week’s notice in this instance.

However we have seen clauses worded in such a way that an employee could consider themselves to have passed probation once the time period in question has expired, so it’s by no means always clear.

Top tip

Make sure your contract is absolutely clear under what circumstances probation is considered to have been passed, and even consider having wording specifying that in the absence of confirmation, it is deemed to have been extended.

If you do have such wording, that doesn’t mean you can let it drift indefinitely but it will allow a bit of ‘slippage’.

Make use of diary reminders or an HR system if you have one to ensure meetings are booked in for well in advance to avoid a dispute in the first place! "

In this instance they seem to have got away with it but consider what would have happened if the phrasing was not so clear as often happens. This is a relatively minor issue but the cost in pure time terms was probably greater than the potential pay-out. What if it wasn't so clear cut? What if it was someone past their probationery period and there was a disciplinary issue?

Most employers these days have HR policies and procedures in place but in many instances these are not reviewed on a regular basis and therefore you are putting yourselves at risk. Charities have a statutory responsibility to review risk. Sole traders, partnerships and limited companies other than public companies do not.Yet both are at risk! Employees are entitled to the protection of employment legislation but so are employers!  So, if your HR procedures are two years old or more then get them reviewed and do so on a cyclical basis.