Q. Our company has an initial 90-day probationary period for all new employees. Our employee handbook clearly describes the probationary period and also contains an introduction stating that the company has the right to terminate its employees at any time with or without cause. Our attorney recently informed us that the two provisions may be inconsistent and recommended that we delete the handbook’s reference to a probationary period. Should we follow her advice?
A. Many employers require new employees to complete an introductory period during which the company closely monitors and evaluates their performance. Such a period enables both the employer and the employee to evaluate a worker’s aptitude for the job and compatibility with the organization.
However, using the traditional term “probationary period” to describe this initial evaluation period has created legal problems for some employers. Several courts have concluded that the existence of a probationary period (in which employees clearly can be terminated at will) implies that employees who successfully complete the probationary period may be terminated only for cause. In this regard, the existence of a “probationary” period may undermine the employer’s efforts to preserve its right to terminate employees at will.
You generally can avoid this result by including additional language in the handbook reaffirming the employer’s right to terminate its employees at will, either during or after the introductory period.
Employers also have found it useful to describe the introductory period as a “training” or “orientation” period, rather than the more traditional “probationary” period.
Thus, your attorney’s conclusion that the company’s probationary period may be inconsistent with its status as an “at will” employer is correct, but you probably can correct the inconsistency without eliminating the period altogether.