Technically Ms S was re-employed by a new employer. The new purchasers indicated that if the five employees wished to carry on working there, then they would be interviewed. Ms S was interviewed and was then given a draft employment agreement because she had got the job. The new owners were to be taking over the business on 1 October 2009 and because Ms S needed some time to go through the employment agreement, she didn’t sign it until 2 October 2009. So she didn’t sign the agreement before she started work for the new employer.
The employment agreement Ms S did sign included a 90-day trial period clause. Ms S was a bit concerned about the 90 day clause but did not go as far as to disagree with it with her new employer.
The new owners became dissatisfied with Ms S’ performance within a short period of time. On 8 December 2009, Ms S was dismissed summarily . The new employers thought they were entitled to so because it was within the 90 day trial period. Ms S asked what she had done wrong and their response was that she was not what they were looking for and she was inexperienced.
The Employment Court had to decide whether or not the 90 day trial period would apply in this situation.
The trial period section of the Employment Relations Act defines an employee as one “who has not been previously employed by the employer”. Because Ms S had begun her employment (on 1 October 2009), but she had not signed her employment agreement until 2 October 2009, the Court found she did not fit within the definition of “employee” as defined in that particular section of the Act.
She was an existing employee (albeit for a very short amount of time) and therefore an employee who was not covered by the trial period section. Therefore, her previous terms and conditions of employment with the old owners continued to be the basis of her new contract with the new owners until it was varied when she signed the written agreement executed on 2 October 2009.
To make things worse for the employer Ms S’ employment agreement required her employer to give four weeks notice of dismissal if they were going to use the 90 day trial period. They did not give her the appropriate notice which means that even if the employer had been able to rely upon the 90 day trial period term which provided the Employment Court with another reason why Ms S could challenge her dismissal by personal grievance.
It seems to me that had the new employer gotten Ms S to sign her Employment Agreement before she started her employment and given the notice period in the clause then they would have been ok. Employers need to ensure that employees who are being taken on a trial period sign an Individual Employment Agreement before they start work .
