Termination During Probation Under the Fair Work Act in Australia

Probation can be a valuable “getting to know you” period in any new hire, especially for small businesses where each role has a big impact on your team, customers, and cashflow.

But when things aren’t working out, many employers get stuck on the same question: can we end employment during probation without legal risk?

The short answer is: even during probation, Fair Work issues can still arise if you don’t follow a fair process, meet your minimum obligations, and avoid unlawful reasons for dismissal.

Below, we’ll walk you through what “probation” really means in Australia, what protections may (and may not) apply, and a practical process you can follow to reduce the risk of disputes when ending employment early.

What Does “Probation” Mean Under Fair Work?

In Australia, “probation” usually refers to an initial period of employment where you assess whether the employee is a good fit for the role and your business.

Probation isn’t a free pass to ignore legal obligations. It’s also not always the same as the Fair Work “minimum employment period” (which is important for unfair dismissal eligibility).

Probation Period vs Minimum Employment Period (Why It Matters)

Many small business owners assume that if someone is “on probation”, they can be dismissed instantly with no consequences. In practice, Fair Work issues tend to arise when probation is treated too casually.

Here’s the key distinction:

• Probation period is typically set out in the employment contract (for example, 3 or 6 months). It’s a contractual assessment period.
• Minimum employment period is set by the Fair Work Act and affects whether an employee can bring an unfair dismissal claim (often 6 months, or 12 months for some small businesses).

Even if an employee cannot bring an unfair dismissal claim yet, they may still have other claims available (for example, general protections, discrimination, or underpayment claims). That’s why termination during the probation period under the Fair Work system still needs to be handled carefully and consistently.

Does Probation Have To Be In Writing?

Probation is commonly included in a written contract, and that’s best practice.

If you don’t clearly set probation terms in writing, it becomes harder to manage expectations about performance, notice periods, and how you’ll assess “fit”. A solid Employment Contract can help you spell out probation length, review points, and termination notice requirements from day one.

Can You Terminate Employment During Probation Under Fair Work?

Yes, you can usually terminate employment during probation if the person isn’t suitable for the role. However, you still need to comply with:

• the employment contract (including any probation clause and notice requirements)
• the National Employment Standards (NES), where applicable
• any applicable modern award or enterprise agreement
• anti-discrimination laws and “general protections” rules
• workplace policies and procedural fairness expectations (as a risk-management measure)

Put simply: probation can make termination simpler, but it doesn’t make it “risk-free”.

Do You Need A Reason To Terminate During Probation?

Legally, you’re generally able to end employment during probation if the employee isn’t meeting role expectations.

From a practical and risk perspective, it’s wise to have a clear, documented reason. This can be as simple as:

• the employee is unable to perform key duties, even with training
• ongoing lateness or attendance issues
• behaviour not aligned with workplace expectations
• skills mismatch (for example, they said they could do X, but can’t)

Being clear about the reason helps you communicate the decision professionally and reduces the chance of a dispute later.

Notice Periods Still Apply (Even During Probation)

A common mistake is assuming you can dismiss someone “effective immediately” just because they’re on probation. Whether notice is required depends on the contract, award coverage, and the circumstances.

If you want to end employment immediately, you may need to consider payment in lieu of notice (paying out the notice instead of having them work it).

Also keep in mind that different minimum notice rules can apply under the NES, and awards can add extra requirements. If you’re unsure, it’s worth checking before you have the termination conversation.

A Practical Step-By-Step Process For Termination During Probation

If you’re navigating termination during the probation period and want to stay aligned with Fair Work requirements, the safest approach is to treat it like a scaled-down performance management process: fair, timely, and properly documented.

Here’s a practical framework many small businesses use.

1) Check The Contract, Award, And Any Policies

Before you do anything, confirm:

• probation length (and whether it can be extended)
• notice requirements during probation
• any award-specific steps (some awards set out minimum notice periods or consultation obligations)
• whether your policies set expectations about warnings or performance discussions

This is also the moment to check whether you have the right documents in place, including a signed contract and any relevant workplace policies.

2) Identify The Key Issue (Performance, Conduct, Or Fit)

Be specific about what isn’t working. “Not a good fit” is often true, but it’s too vague on its own.

Try to pinpoint:

• what standard is required (for example, accuracy, speed, customer service expectations)
• what you observed instead
• what support/training you provided (if any)
• what improvement you expected, and by when

This doesn’t need to be complicated. Even short notes dated in real time can be very helpful later.

3) Have A Direct Conversation Early (Don’t Wait Until The End)

Probation is designed for early feedback. If you wait until the last week of probation to raise serious issues, it can feel unfair and can escalate conflict.

A quick, respectful check-in can help you decide whether the issue is solvable. Sometimes a small adjustment (better training, clearer KPIs, role clarification) is all that’s needed.

4) Give A Clear Opportunity To Improve (When Appropriate)

You’re not always required to run a formal warning process during probation, but giving a reasonable opportunity to improve is often a smart risk-management step.

This might include:

• clarifying expectations in writing (even by email)
• setting a short review period (for example, 1-2 weeks)
• offering targeted training or supervision

It also helps you show that the termination decision was based on job-related concerns, not something unlawful or personal.

5) Prepare Your Termination Meeting And Final Pay

If you decide to proceed, plan the conversation and the admin side at the same time.

In most cases, you’ll want to have ready:

• a short termination letter confirming the end date and notice (or payment in lieu)
• the calculation of final pay (including any unused accrued entitlements)
• instructions for returning property (keys, devices, uniforms)

If you have a larger team, you may also want internal documentation ready (for example, your termination checklist and internal approvals). Some businesses use a dedicated Employee Termination Documents pack to keep the process consistent.

6) Keep The Meeting Simple, Respectful, And Brief

In your meeting:

• be clear that you’re ending employment
• keep the explanation factual (avoid personal commentary)
• confirm notice arrangements and final pay timing
• explain the return of company property and system access

As tempting as it can be to “debate” the decision, it’s usually best to keep the discussion short. If the employee becomes distressed or angry, end the meeting respectfully and follow up in writing.

Common Legal Risks Employers Miss During Probation

Most probation terminations are straightforward. The risk tends to come from avoidable mistakes in process or communication.

Here are the main problem areas we see.

1) Assuming Unfair Dismissal Is The Only Risk

Even where an employee can’t bring an unfair dismissal claim (because they haven’t met the minimum employment period), other legal risks can still apply.

For example, employees may have options under “general protections” if they allege they were dismissed for exercising a workplace right (such as asking about pay, making a complaint, or taking sick leave).

This is why it’s important your decision-making is based on role requirements and is properly documented.

2) Terminating For A “Protected Reason”

Probation is not a shield against unlawful termination.

You should be very cautious if the termination is linked (even indirectly) to things like:

• pregnancy, parental responsibilities, or family commitments
• disability or medical conditions
• race, age, sex, religion, or other protected attributes
• temporary absence due to illness or injury

If a dismissal could be perceived this way, get advice before taking action.

3) Mishandling Sick Leave During Probation

It’s common for performance concerns to overlap with attendance issues, and it’s also common for employees to take leave early in employment.

If an employee is unwell, make sure you handle leave requests consistently and ask for evidence only where appropriate. For context, many employers ask what to do about sick days without a certificate and how that interacts with workplace policies.

If you’re considering termination around the same time as leave, it’s especially important to be able to show the decision was unrelated to the leave and linked to genuine performance or role requirements.

4) Confusion About Notice And “Instant” Termination

If you end employment immediately without providing proper notice or pay in lieu, you risk an underpayment dispute (and potentially penalties, depending on the circumstances).

Also remember: “serious misconduct” is a high threshold. If you’re relying on serious misconduct to terminate without notice, make sure you have a solid factual basis and have followed a fair investigation process where needed.

5) Not Having A Clear Paper Trail

You don’t need to turn probation into a mountain of paperwork. But you do need enough documentation to show:

• what expectations were
• what you observed
• what you communicated to the employee
• why you decided to end employment

This is often the difference between a clean termination and a stressful back-and-forth later.

What Documents Should You Have In Place To Manage Probation Properly?

When probation is managed well, it’s usually because expectations and processes were clear from the start.

Here are the key documents that help small businesses handle termination during probation with more confidence.

• Employment contract: sets probation length, duties, notice, confidentiality, and other key terms. Having a tailored Employment Contract is one of the most practical ways to avoid misunderstandings.
• Position description: clarifies what “good performance” actually looks like, which makes probation reviews far easier.
• Workplace policies: including conduct, performance management, leave, and workplace behaviour standards. Consistent policies reduce the risk of employees claiming they were treated differently.
• Probation review templates: even a simple checklist for week 2, week 6, and month 3 reviews can help you identify issues early.
• Termination letter: confirms the decision, end date, notice arrangements, and return of company property. This is often included in an Employee Termination Documents set.

Do You Need To Give Warnings During Probation?

There’s no universal rule that you must give a certain number of warnings during probation.

However, warnings (even informal ones) can be useful where the issue is performance and you think the employee might improve with feedback.

If you’re unsure how warnings interact with dismissal risk, it can help to understand how many employers approach warnings before dismissal as part of a broader, fair process.

What If You Want To Extend Probation?

Probation extension can be appropriate when you haven’t had enough time to properly assess performance (for example, due to training delays, business shutdown periods, or unexpected absences).

If you extend probation:

• make sure the contract allows for it (or document the agreement clearly)
• confirm the new end date in writing
• set clear goals for the extended period

Importantly, extending a contractual probation period does not extend the Fair Work Act minimum employment period for unfair dismissal eligibility. These are separate concepts, and unfair dismissal access is based on an employee’s length of service (and whether the employer is a small business employer), not the probation end date stated in the contract.

Extending probation shouldn’t be used to avoid dealing with performance concerns. It should be used to give a genuine additional assessment period.

Key Takeaways

• Probation is a helpful assessment period, but it doesn’t remove your Fair Work obligations or eliminate legal risk.
• Termination during probation still requires you to follow the contract, minimum notice rules, and any applicable award obligations.
• Even if unfair dismissal protections may not apply yet, other risks can still arise (including general protections and discrimination-related issues).
• A simple, consistent process-early feedback, clear expectations, and basic documentation-can significantly reduce disputes.
• Having the right documents in place (especially an Employment Contract and clear termination paperwork) makes probation management far more straightforward.

This article is general information only and does not constitute legal advice. If you’d like advice about your specific situation, get in touch with a lawyer.

If you’d like help managing termination during the probation period (including contracts, award compliance, and termination documents), you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.