90-Day Trial Periods – Size No Longer Matters

The Government passed a Bill under urgency this week to restore the right for any employer to include a 90-day trial period in a new employment offer for an employee who has not worked for them before.

In addition to not having worked for the employer previously, other factors for a 90 day trial period to be valid include, but are not limited to;

  • The trial period must be included in the employment agreement with a valid notice period and wording that meets the minimum required standards
  • The employee must have had sufficient opportunity to get advice and raise any issues or questions about the offer before accepting it
  • The employment agreement must be signed by the employer and employee before the employee starts work
  • Notice of a dismissal must be properly given

If the role being appointed to is covered by a Collective Employment Agreement the usual processes apply.  This includes that individual terms cannot be inconsistent with the collective terms for union members.

Related legislation such as the Human Rights Act continue to apply, as do immigration rules like the recent one by Immigration NZ to not allow 90-day trial periods for people who will require an Accredited Employer Work Visa.   An employee can also still raise a personal grievance if an employer does something that unjustifiably disadvantages them.  

In addition to considering the compliance requirements, our encouragement would be to assess the value add for considering the use of a 90-day trial period if you are not using this type of provision at the moment.  This includes thinking about what roles you might want to consider using trial periods for, if using a trial period could impact your ability to recruit, what notice periods you want to consider for the different types of roles you want to employ and whether their use could affect the culture of your business and how you live your values.

For more information about 90-day trial periods, help with deciding when you might want to consider using one or support with updating your employment agreement templates, contact a member of the Grow HR team.