SUMMARY

The research project

This report presents the results of a Department of Labour evaluation of trial employment periods. The evaluation was conducted during October 2009 and May 2010. It was focused on employers' experiences, and aimed to assess the extent to which employers and employees knew about trial periods, the impacts of trial periods on employers and employees, and employers' perceptions of the costs of using trial periods relative to benefits.^[1]

The research used both quantitative and qualitative methods. Data was collected through two employer surveys, interviews with employers, employees and union officials, and a literature scan. Trying to ascertain macro-economic impacts of and influences on trial periods was out of scope of the research.

Results

Knowledge

• Interviews showed that employers' awareness of trial periods was high. A majority of employers (between 62% and 74%) knew several key details when asked, but comprehensive knowledge of trial periods appeared less common.
• Misconceptions about trial periods related to:
  • dismissal procedures under a trial period, including the length of the trial period required prior to dismissal, and
  • whether the trial period only applied to full-time permanent employees.
• Employees interviewed did not have comprehensive knowledge about trial periods but knew they could be dismissed without reason and could not make a personal grievance claim of unfair dismissal.

Use of trial periods

• Of the employers who had hired someone since 1 March 2009, half of them had used a trial period when hiring at least one employee.
• Reasons for using trial periods related to:
  • checking an employee's suitability for the job before making a commitment, and
  • being able to dismiss the employee easily if they were unsuitable for the job.
• Reasons for not using trial periods related to:
  • the duration of the work,
  • the employers' views of employment relationships generally,
  • whether the employer knew the applicant, and
  • the information the employer had about using trial periods.

Employment outcomes

• Three quarters (74%) of those employed on a trial period had retained their employment once the trial period was over (a further 5% were still working within the trial period at the time of the survey).
• In relation to the last employee they had hired on a trial period, 40% of employers stated they would not have or were not likely to have hired that person without the trial period.

Costs incurred by employers

• Employers appeared not to have incurred any costs in implementing trial periods, and some had avoided the costs associated with dismissing or retaining unsuitable staff.

Satisfaction

• Employers were very positive about how well the trial periods were working for them - 87% of employers thought trial periods were working very well or quite well.
• Employee views were mixed: some thought a trial period was useful to assess whether or not the job was suitable; others felt vulnerable as they lacked job security.

Conclusion

The evaluation found that in the first year of its operation, employer awareness of trial periods was high, although detailed knowledge was uneven. Irrespective of their level of knowledge, the trial period provision was used by half of eligible employers, who were generally very satisfied with the way it was working. Employers faced no costs in implementing the provision, and there were indications of cost savings for employers from simplified dismissal processes.

Employees did not appear to have a comprehensive knowledge of trial periods. Those experiencing trial periods had a range of views, recognising some benefits of trial periods for themselves as well as for employers, but also feeling vulnerable to unfair treatment and job loss. However for those retaining employment after a trial period (three quarters of those employed on a trial period), the experience was not negative.

---