There is no federal law that either prescribes or prohibits employers from treating employees as probationary, initial, trial, introductory, or provisional employees. No matter what name a company assigns to new employees, that is up to a company to determine through its policies. That issue primarily has relevance with respect to whether new employees have seniority of any kind for purposes of a benefit plan. The only type of benefit for which those incoming employees would potentially have to be granted immediate access to your company’s benefit plan would be health insurance, due to the federal law known as HIPAA (Health Insurance Portability and Accountability Act). To determine whether HIPAA would apply in your company’s case, ask your company’s health insurance carrier for guidance. No other types of benefits would have to be immediately granted.
The other major reason for classifying employees as new, probationary, initial, trial, introductory, or provisional is to let them know that during that time, they will be subject to special scrutiny and must turn in successful performance in order to continue with the company and become “regular” employees. As noted above, there is no obstacle to the company classifying the incoming employees in such a manner. There is also no particular legal significance to such a classification, since most states are at-will, and an employer can subject any at-will employee at any time to special scrutiny, consistent with express employment agreements and specific statutes such as employment discrimination laws.
A Problem of Terminology
The problem with using a term such as “probationary period” or “probationary employee” is that over time, such terms have acquired a certain amount of semantic baggage that tends to mislead some employees into thinking that once they have “passed” the probationary period, their jobs are “safe” or even guaranteed, and they cannot be fired except for cause. In other words, some people think, however erroneously, that during a probationary period, their employment is at will, and they can be fired at any time for any reason that doesn’t violate a specific law, and that passing a probationary period actually modifies the at-will employment relationship to where their employer can no longer fire them at will, but rather must have some sort of good cause before it can fire them. Such employees, if they are fired after completing the initial period of employment, often think they have a good case for bringing a lawsuit against the company. As a rule, such lawsuits are extremely difficult to sustain and are usually dismissed.
Under general employment law, the presumption is that all employment is at-will unless the employer has done or said something tangible that would modify the relationship. Usually, that kind of thing is something like a formal written employment contract, wherein certain procedures are laid out that must be followed before someone can be terminated from employment, such as a prescribed series of warnings and a notice period, or else specified offenses that can lead to immediate termination. Most employment relationships are not on the basis of a formal contract, and employment at will is the rule followed.
With the above issues in mind, most employment law attorneys advise against calling the initial period of employment a “probationary period”, simply because it is so often misunderstood by employees, and for that reason can lead to unnecessary, and expensive, lawsuits. Rather, many attorneys advise calling the initial period an “initial”, “trial”, “introductory”, or “provisional” period, not because those are magic words or are required by law, but because they have not resulted in the same level of misunderstanding by employees. No matter what the initial period of employment is called, though, it is a good idea to make it clear in the section of the policy handbook defining such a period that completion of the period does not change the employment-at-will relationship and that either party may terminate the employment relationship at any time, with or without notice. That would be in addition to the standard employment-at-will disclaimer that should be in any good employee handbook.
Log in or Register to save this content for later.