DISMISSAL / DISCHARGE OF PROBATIONERS

SUBMITTED BY RAJ KRISHNA, (ROLL NO. 1359), B.A.L.L.B. (HONS.)

SUBMITTED TO Dr. S.C ROY, PROFESSOR OF LAW

FINAL DRAFT SUBMITTED IN PARTIAL FULFILLMENT OF THE COURSE

LABOUR LAW- I FOR THE COMPLETION OF B.A.L.L.B (HONS.) COURSE.

SESSION 2015-2020
APRIL, 2017

CHANAKYA NATIONAL LAW UNIVERSITY

NYAYA NAGAR, MITHAPUR

PATNA

1
 DECLARATION BY THE CANDIDATE

I hereby declare that the work reported in the B.A., LL.B (Hons.) Project Report entitled
―Dismissal/ Discharge of Probationers‖ submitted at Chanakya National Law University is an
authentic record of my work carried out under the supervision of Dr. S.C. Roy. I have not
submitted this work elsewhere for any other degree or diploma. I am fully responsible for the
contents of my Project Report.

SIGNATURE OF CANDIDATE

NAME OF CANDIDATE: RAJ KRISHNA

CHANAKYA NATIONAL LAW UNIVERSITY, PATNA.

2
 ACKNOWLEDGEMENT

I would like to thank my faculty Dr. S.C. Roy whose guidance helped me a lot with structuring
my project.

I owe the present accomplishment of my project to my friends, who helped me immensely with
materials throughout the project and without whom I couldn‘t have completed it in the present
way.

I would also like to extend my gratitude to my parents and all those unseen hands that helped me
out at every stage of my project.

THANK YOU,

NAME: Raj Krishna

COURSE: B.A., LL.B. (Hons.)

ROLL NO: 1359

SEMESTER – 4th

3
INDEX

INTRODUCTION …………………………………………………………………pg. 1

* AIMS AND OBJECTIVES

* HYPOTHESIS

* RESEARCH METHODOLOGY

* SOURCES OF DATA

* LIMITATON

1. PROBATION PERIOD: CONCEPTUAL DISCUSSION

2. PROBATION: JUDICIAL OVERVIEW

3. EXPLOITATION DURING PROBATIONARY PERIOD

4. CONCLUSION AND SUGGESTIONS

BIBLIOGRAPHY………………………………………………………………………pg17

4
INTRODUCTION

In a workplace, probation (or probationary period) is a status given to new employees of a

company or business. It is widely termed as the Probation Period of an employee. This status
allows a supervisor or other company manager to evaluate closely the progress and skills of the
newly hired worker, determine appropriate assignments, and monitor other aspects of the
employee such as honesty, reliability, and interactions with co-workers, supervisors or
customers.

A probationary period varies widely depending on the business, but can last anywhere from 30
days to several years. In cases of several years, probationary levels may change as time goes on.
If the new employee shows promise and does well during the probationary time, they are usually
removed from probationary status, and may be given a raise or promotion as well (in addition to
other privileges, as defined by the business). Probation is usually defined in a
company's employee handbook, which is given to workers when they first begin a job.

The probationary period also allows an employer to terminate an employee who is not doing well
at their job or is otherwise deemed not suitable for a particular position or any position. Whether
or not this empowers employers to abuse their employees by, without warning, terminating their
contract before the probation period has ended is open for debate. To avoid problems arising
from the termination of a new employee, many companies are waiving the probationary period
entirely, and instead conducting multiple interviews of the candidate, under a variety of
conditions - before making the decision to hire.

The placement of an employee on probationary status is usually at the discretion of their

manager. Therefore, the study becomes very important.

OBJECTIVES OF THE STUDY

1. The aim of the researcher is to find out the rights and duties available with one under
probation period.

2. The researcher tends to analyze the loopholes and lacunas in existing system.

3. The researcher tends to give certain suggestions after analyzing the present conditions which
would be useful for society.

5
HYPOTHESIS

The researcher tends to presume that probation period has no bearing upon our legal rights.

RESEARCH METHODOLOGY:

The researcher will be relying on Doctrinal method of research to complete the project.

SOURCES OF DATA:

The researcher will be relying on both primary and secondary sources to complete the project.

1. Primary Sources: Acts and Statutes.

2. Secondary Sources: Books, newspapers and websites.

LIMITATIONS OF THE STUDY:

The researcher has territorial, monetary and time limitations in completing the project

6
 1. PROBATION PERIOD: CONCEPTUAL DISCUSSION

Where there is uncertainty regarding suitability of a candidate for a particular job, it is usual to
offer employment to such candidate on a probation basis. As the name 'probation' suggests, the
employment offered is to ascertain or test the suitability of the employee on probation for the
job. Consequently, it is clear that so long as an employee is on probation, continuation of his or
her employment is not certain, and is subject to the employer being satisfied that the employee is
suitable for the job. 1

The employment letter or the contract of employment may prescribe the manner in which the
suitability (or confirmation) is to be communicated by the employer. It could be express or
implied. The terms of the employment letter or contract may prescribe that the employee would
be deemed to have completed his or her probation period successfully at the end of the probation
period unless his or her employment is terminated prior to the date of probation period or the
probation period is extended. Alternatively, the employment letter or contract may provide that
probation period would continue till such time a confirmation is not given in writing by the
employer. The Employment Act does distinguish between a employee under probation and other
employees. He enjoys all the same rights as any other confirmed employee.2

In the event the employer is not satisfied with the performance of an employee on probation, the
employer is free to terminate the services of the employee before the completion of probation
period subject to the notice period, if any, prescribed in the employment letter or company's
policy. Since the basic idea behind keeping an employee on probation is to give the employer an
opportunity to evaluate the employee's performance before confirming the appointment, there is
not even the need for an employer to wait for the employee to complete his or her probation

1
Krishna Vijay Singh, India: Termination Of Employment Of Probationary Employees - Legal Issue, Mondaq
(April 18, 2017, 9:40 p.m.),
http://www.mondaq.com/india/x/529266/employee+rights+labour+relations/Termination+Of+Employment+Of+Pro
bationary+Employees+Legal+Issues
2
Id.

7
period, before termination, if the employer is dissatisfied with the performance. It is also settled
law that the employer is not under an obligation to establish or prove the unsatisfactory
performance of a probationer through an enquiry prior to terminating his or her services.
Nevertheless, it is important for employers to be aware of the legal issues surrounding
termination of an employee on probation.3

The termination is valid so long as it is done by a non-stigmatic order. In this regard, it is

noteworthy that the Indian courts have consistently held that the termination of a probationary
employee is to be done by a non-stigmatic order and principle of natural justice need not be
followed while passing such order. Reviewing the case law will also assist us in understanding
how the courts have interpreted 'stigmatic' and 'non-stigmatic' orders.4

3
Id.
4
Id.

8
 2. PROBATION: A JUDICIAL OVERVIEW

5
The Supreme Court of India in the matter of Chaitanya Prakash and Anr. Vs. H. Omkaraappa
observed that the termination order referring to the unsatisfactory services of the probationer
cannot be said to be stigmatic and there is no need to follow the principles of natural justice
while terminating the services of a probationer. Recently, Delhi High Court in The Managing
Committee of Shiksha Bharati Senior Secondary Public School Vs. Director of Education and
Anr. (2013) has taken a similar view wherein the respondent who was a primary teacher working
on probation with the petitioner /school, was terminated by the school with immediate effect
before the expiry of extended period of probation. The issue which came up for adjudication
before the court was whether termination order stating that the employee lacked professional
capability or was negligent and careless or her conduct was deplorable and had indulged in acts
of indiscipline and insubordination would amount to order being stigmatic. The Hon'ble Court
held that "law with respect to termination of services of a probationer is now well-settled and has
to be by a non-stigmatic order. However, it has been held that stating that the performance is not
satisfactory or giving of facts in the termination order will not amount to the termination order
being a stigmatic one. Also the principles of natural justice have not to be followed before
termination of services of a probationer. If an enquiry is held and the enquiry report forms the
foundation of termination of services of a probationer, only then, principles of natural justice are
required to be followed, however, where the enquiry against a probationer is only for
determining employee's suitability for continuing in service and the enquiry report only forms
the motive for removal (as differentiated from a foundation for removal) then, a detailed enquiry
in terms of the service rules is not necessary."

Similarly, reference must be made to the judgment in the matter of Shri Syed Mohiuddin Ashraf
& Anr. Vs. M/s. Central Electronics Limited (2013) wherein the Hon'ble Delhi High Court had
taken the same view, with respect to the termination orders of the petitioners who were working
with the respondent as probationary engineers. In the present case it was contended by the

5
Chaitanya Prakash and Anr. Vs. H. Omkaraappa [(2010)2SCC623]

9
petitioners that their orders of termination were void as they are violative of principles of natural
justice, arbitrary, stigmatic and punitive in nature and without any reason as the petitioners had
rendered satisfactory services. In the present case, the Hon'ble Court brushed aside the
contentions taken by the petitioners and it was held that the principles of natural justice need not
be followed while terminating the services of a probationary officer. In so far as the plea of
stigmatic order is concerned, the Hon'ble court observed that since the orders of termination only
states that petitioners are unfit for continuing their work thus, the expression used in the order
cannot be said as stigmatic in nature.

Additionally, in Progressive Education Society v. Rajendra6, the Hon'ble Apex Court examined
the correctness of the order passed by the School Tribunal quashing the termination of the
service of respondent No. 1 on the ground of unsatisfactory performance during the period of
probation and observed that "The law with regard to termination of the services of a probationer
is well established and it has been repeatedly held that such a power lies with the appointing
authority which is at liberty to terminate the services of a probationer if it finds the performance
of the probationer to be unsatisfactory during the period of probation. Unless a stigma is attached
to the termination or the probationer is called upon to show cause for any shortcoming which
may subsequently be the cause for termination of the probationer's service, the management or
the appointing authority is not required to give any explanation or reason for terminating the
services".7

Therefore, on a conjoint reading of the above observations by the various courts it is abundantly
clear that once the facts stated in the termination are only the reasons and the conclusions for
holding that the employee is unsuitable for his services, then the order cannot be said to be
stigmatic. However, if the order imputes something more than unsuitability for the post in
question then the order may be considered to be stigmatic. Moreover, it is not necessary for an

6
Progressive Education Society v. Rajendra [(2008)3SCC310]
7
Singh, supra note 1.

10
employer to follow principles of natural justice even when the termination of the probationer is
ordered on the ground of unsatisfactory service.8

However, care should be taken by the employer in the event the employee is discharged by the
employer on the basis of misconduct or if there is a nexus between the allegations of misconduct
and discharge. In such an event, the order of termination, even if couched in language which is
not stigmatic, may amount to a punishment for which a departmental enquiry may be
imperative.9

8
Id.
9
Id.

11
 3. EXPLOITATION DURING PROBATION PERIOD

Despite the above employers frequently misuse the probationary status of the employee to get rid
of the employee because:

* The employee has committed misconduct

* The employer wants to make space for a brother, friend or cousin of the owner

* The employee ‗does not fit in‘

In fact the labour law meaning of ‗probation‘ is ‗testing the employee‘s work performance‘. That
is, the only legitimate purpose of a probationary period is for the employer to assess the
suitability of the employee in terms of his/her work performance.

A probationary employee is one who has a conditional employment contract (written or

unwritten). That is, the continuation of the contract is conditional on whether the employee‘s
work performance during the probationary period shows that he/she is or is not able to carry out
the work properly. While this describes the purpose of the probationary period it does not mean
that the employer has a free licence to fire the probationer if the employer believes his/her
performance to be unsatisfactory.10

The employer is allowed to extend the employee‘s probation period in order to further assess the
employee‘s performance. This might occur, for example, where the employee shows promise but
has made some errors or the opportunity for evaluation has been reduced during the initial
probation period.

10
Probation Periods, Polity (April 20, 2017, 2:00 p.m.), http://www.polity.org.za/article/probation-periods-2011-06-
28

12
However, before extending the probation period the employer is required to give the employee
the opportunity to make representations as regards the proposed extension. The biggest mistake
that employers frequently make is believing that the conditional nature of the probationary
employment reduces the probationer‘s labour law rights. On the contrary, the employer that
places an employee on probation has a number of legal obligations including:

* Making it clear that the employee is on probation

* Clarifying the length of the probation period

* Setting reasonable performance standards

* specifying for and explaining to the employee the performance standards required

* evaluating and monitoring the employee‘s performance against the set performance standards

* informing the employee of performance shortcomings

* issuing warnings to the employee where he/she is failing to meet the required standards

* assisting, guiding, counselling, training the employee where necessary

* before dismissing the probationer, giving him/her an opportunity to state his/her case.11

For example, in the case of Fraser vs. Caxton Publishers (2005, 3 BALR 323) the employee was
fired for falsifying her CV and for incompatibility. She took the matter to the CCMA where the
arbitrator agreed that she was indeed guilty of the conduct for which she had been fired. The
arbitrator also agreed that this misconduct was serious enough to merit dismissal. Despite this the
arbitrator found the dismissal to be unfair because the employer had not given the employee a
chance to defend herself against the charges. The employer was therefore ordered to pay the
employee compensation equal to four months‘ remuneration.

11
Id.

13
In the case of Tharratt v Volume Injection Products (Pty) Ltd (2005, 6 BALR 652) the employee
was dismissed during his probation period for poor performance. As the employer had failed to
investigate the cause of the poor performance the CCMA found the dismissal to be unfair. The
employer was therefore ordered to pay the employee compensation equal to three months‘
remuneration.

In Smith / Patient Focus Africa (Pty) Ltd (2009) 18 CCMA 7.20.1 the employee‘s initial
probation period was extended due to her poor performance. The employer did initially address
the poor performance but failed to do so during the last two months of her employment. The
commissioner stated that the employee should have been counselled on her poor performance
and she had to be given the opportunity to make representations to the employer prior to deciding
whether to dismiss or not. The employee was awarded 1 month of her salary as compensation.

These cases highlight the fact that probationary employees are strongly protected by labour law.
At the same time, probationary employees often do not work out as well as was hoped. While the
law allows the employer to dismiss such failures they must follow strict procedures first.12

12
Id.

14
 4. CONCLUSION AND SUGGESTIONS

As noted above, the most important way to protect your company‘s rights when using
probationary policies is to note in all documents that employment is at will, even for employees
who are on probation or who have completed probation. Here are some other steps you can take,
to ensure both that your company doesn‘t take on unnecessary legal risks and that the employee
has the best opportunity to learn the job or correct performance problems.13

The employer should be clear about his expectations. Notify the employee of the probationary
status, how long it will last, and what needs to happen or change during that time. Will the
employee meet with you every week? Will the employee need to hit certain performance
milestones?14

Things which should be done by the employer during probationary period:

a. Give feedback regularly. Conduct periodic reviews with the employee to provide feedback and
counseling. If the employee is having performance issues, give detailed guidance on how the
employee can improve—and offer training, if necessary.

b. Get help for the employee. Assign a knowledgeable and experienced mentor to advise the
employee. If the employee needs training or other resources make sure they are provided.

c. Get feedback from your human resources department. HR can help you make sure you are
treating the employee fairly and consistently. For example, if you place a struggling employee on
a one-month probationary period but most other managers give employees three months to
improve performance, you‘ll want to make sure you are giving the employee a fair chance to turn
things around.

d. Document everything. If an employee can‘t do the job or improve performance, you‘ll likely
want to terminate the employment relationship. To avoid legal trouble, clearly document
everything during the probationary period: the employee‘s performance, your efforts to coach

13
Lisa Guerin, What Is a Probationary Period and How Does It Work?, Lawyers (April 18, 2017, 11:40 p.m.),
http://labor-employment-law.lawyers.com/human-resources-law/what-is-a-probationary-period-and-how-does-it-
work.html
14
Id.

15
and manage, any training provided, and so on. This will leave you on safe legal ground if you
decide that the employee isn‘t going to make the cut.15

15
Id.

16
 Bibliography

BOOKS:

A. Mishra S.N., Labour and Industrial Laws, Central Law Publications.

WEBSITES:

1.www.labor-employment-law.lawyers.com/

2. www.mondaq.com

3. www.lawyersclubindia.com

4. www.labourguide.co.za

17