Formal Légal | What's the point of probation

Delphine Robert: Hello and welcome to another episode of Format Légal, the legal news podcast brought to you by Gowling WLG, international law firm. Don't forget to follow us so you don't miss a single episode, and visit our website, gowlingwlg.com, for all our resources and the latest legal news.

In today's episode, we dive into the subject of the probationary period when hiring a new employee. Throughout this discussion, we'll explore in detail the various legal aspects of this phase, often referred to as a "trial period", as well as its usefulness and limitations. Indeed, we may well ask whether this probationary period is really useful for employers. Is it governed by legal rules and regulations? What are its limits?

To answer these questions, and to take stock of the legal considerations associated with the probationary period of a new hire, we speak today with Me Marc Ouellet, a lawyer and expert in labor and employment law with Gowling WLG in Montreal. Me Ouellet has been practicing in this field for 20 years, and is co-author of the second edition of Les Normes du travail, a "classic" in Quebec labor law.

So, hello Marc, we're very happy to have you with us today...

Marc Ouellet: Thank you! I want to make it clear that our conversation is mostly going to be about probation in a non-union context. Because in a unionized context, the rules can be a little different. Hiring qualified and competent employees is not an easy task for employers.

The selection interview is often insufficient to fully assess a candidate's skills and aptitudes, not only in terms of performing the tasks involved in the position, but also in terms of interpersonal relations with colleagues and managers, and the candidate's potential for integration into the company.

Probation is therefore often seen as the period at the start of employment during which employers can assess their new employees and, if they don't fit the job, dismiss them on a purely discretionary basis, without being required to give them prior notice.

During this period, the employee's status would be precarious, and the employer would enjoy a prerogative that would give him or her almost absolute discretion over the employee's performance and, consequently, over the life or death of the employment relationship.

Delphine Robert: Is it really like that?

Marc Ouellet: Not really…

Delphine Robert: For what reason(s)?

Marc Ouellet: First of all, you need to know that nowhere in Quebec's labour and employment laws is there any definition of a "probationary period".

In fact, we recognize its existence, but indirectly, when the law states that you must have accumulated a certain seniority with your employer before you can benefit from certain rights, notably to protect your job.

For example, section 82.1 of the Act respecting labour standards states that an employer is not required to give the minimum notice of termination stipulated in the Act when an employee is dismissed within the first three (3) months of employment, regardless of whether or not there is just and sufficient cause for dismissal.

So, these first three (3) months are a sort of "probation period", during which an employee's employment can be terminated without cause, and without having to pay the minimum notice required by the Act respecting labour standards.

But I must emphasize that this is the minimum notice required by the Act respecting labour standards, not the "reasonable notice" required by the Civil Code of Québec. I'll come back to this later...

Most importantly, however, is the two (2) year period required to acquire the right to file a complaint of dismissal without just and sufficient cause under section 124 of the Act respecting labour standards.

In fact, in Quebec, with certain very limited exceptions, for example if the employee is a senior manager in the company, or if the termination of employment results from the abolition of a position for economic reasons or as part of a corporate restructuring, employers cannot legally terminate the employment of an employee with more than two (2) years' seniority unless they have "just and sufficient cause" to do so.

In the absence of such "just and sufficient cause", or of an amicable agreement with the employee, the latter may demand to be reinstated in his job, even if the employer would otherwise prefer to pay him notice of termination.

You could say that this confers a real right to job retention on Quebec employees.

In my opinion, this is the main "legal" probation period.

The employer has two (2) years to evaluate his employee. After that, he stays with him, unless the employee gives him "just and sufficient cause" to dismiss him.

And, as we all agree, the courts in charge of settling disputes relating to this recourse have set the bar very high for employers to prove such "just and sufficient cause". The employee really has to have done something serious, he really has to be "bad", for the employer to be able to say that he has just and sufficient cause to dismiss him.

Delphine Robert: Is there an equivalent in federal law for employers operating in Quebec and subject to federal jurisdiction?

Marc Ouellet: Yes, in this respect, the Canadian Labour Code mirrors the Quebec Act respecting Labour Standards.

Article 230 (1.1) of the Canadian Code states that a minimum of three (3) months' service is required to qualify for the minimum notice of termination stipulated in the Canadian Code.

Article 235 also adds "severance pay" to this minimum notice of termination, but the employee must have at least 12 months' service to be entitled to it.

Finally, section 240 of the Canadian Code provides for a remedy similar to that under section 124 of the Quebec Labour Standards Act, which also provides for the reinstatement of an unjustly dismissed employee, but the time limit for entitlement is even shorter. It is one (1) year.

So, to summarize, the informal legal probation periods for employees in Quebec are:

• three (3) months (both provincial and federal) if an employer wishes to dismiss an employee without cause and without notice;
• 24 months at the provincial level or twelve (12) months at the federal level if an employer wishes to dismiss an employee without cause but with notice.

Beyond that, the employee has a right to continued employment, and there must be just and sufficient cause for dismissal. Even if you offer to pay him notice (as generous as that may be).

Delphine Robert: So, these are the limits employers must respect when setting probation periods for their employees?

Marc Ouellet: Exactly. And it's important to mention that these limits - which can be described as "temporal" - are of public order, in the sense that they cannot be waived in advance or derogated from in a contract.

For example, an employment contract could not provide for a probationary period of six (6) months during which the employer may dismiss an employee without having to pay notice.

The employer would still have to give the minimum legal notice to the employee if he wanted to terminate his employment without cause after three (3) months of service, regardless of what is stipulated in the contract regarding the probation period.

Similarly, the probationary period of an employment contract could not be renewed beyond one (1) year at the federal level, or two (2) years at the provincial level, since after these periods, just and sufficient cause is required to terminate the employee's employment, even if the employment contract states that the probationary period may be renewed.

But there are other limits.

Delphine Robert: Really? Which ones?

Marc Ouellet: Dismissal of an employee without cause during his or her probationary period could prove problematic if it were concomitant with an employment injury, a work-related accident, or the exercise of a right provided for in the Act respecting labour standards or the Labour Code, such as taking sick leave, announcing a pregnancy or participating in a unionization campaign.

These situations would mainly be covered by three (3) remedies, regardless of whether or not the employee is still on probation.

This refers to a complaint of prohibited practice under section 32 of the Act respecting industrial accidents and occupational diseases, a complaint of prohibited practice under section 122 of the Act respecting labour standards, or a complaint of prohibited practice under section 15 of the Labour Code.

For employers under federal jurisdiction, section 246.1 of the Canadian Labour Code provides a remedy for prohibited practices.

All these procedures are essentially the same, and can be exercised by employees regardless of their length of service, i.e. from their first day of employment.

They establish a presumption that dismissal is unlawful when it is imposed concurrently with - or within approximately six (6) months of - the exercise of the right. For example, if an employer dismissed an employee during her probationary period, in the days following the conversation in which she told him she was pregnant, there would be a presumption that the dismissal was imposed because of her pregnancy.

To counter the presumption, the employer would have to show that the dismissal was imposed on the employee for "other just and sufficient cause" unrelated to her pregnancy.

Once again, the courts in charge of deciding these appeals are very demanding on employers to see if they have succeeded in demonstrating another just and sufficient cause.

The employer couldn't simply say he didn't need to give cause since the employee was still on probation. He would certainly be forced to reinstate her, with back pay.

Because these prohibited practice remedies also provide for the reinstatement of the employee should the employer fail to reverse the presumption.

That's why it's always important to document the employee's evaluation during the probationary period in writing, for example by e-mail.

For example, as soon as the decision is made to terminate an employee's employment, it may be a good idea to send an e-mail to each other to record this decision. That way, if the employee takes sick leave, announces his or her pregnancy, or exercises any other right afterwards, the employer will have evidence to show that the decision to terminate the employee's employment was already made when he or she learned of the exercise of the right, and therefore had nothing to do with the exercise of that right.

Employers who don't do this generally find it very difficult to defend themselves against claims of prohibited practices.

Delphine Robert: Are there any other limitations on the employer's discretion to terminate an employee's employment during the probationary period?

Marc Ouellet: Yes, but these are not limits on the right to dismiss the employee per se. Rather, they are limits on the right to dismiss an employee without having to give notice or pay damages.

I'm thinking here of the "reasonable" notice period that must be given under article 2091 of the Civil Code of Quebec to all employees who are terminated without serious cause in Quebec, regardless of length of service and regardless of provincial or federal jurisdiction. This notice is in addition to the minimum legal notice required by the Act respecting labour standards (or the Canadian Labour Code) mentioned earlier.

Article 2091 specifies that the period of leave must be assessed taking into account all the circumstances, in particular the nature of the job, the particular circumstances in which it is carried out and the duration of the work performed.

The fact that employment is terminated during the employee's probationary period cannot be used to justify non-payment of this time-off.

In fact, the employee would be entitled to the time off regardless of what the parties may have agreed by contract, since this is a right of public order that the employee cannot waive in advance. Article 2092 of the Civil Code of Quebec is very clear on this point.

For example, the fact that an employment contract contains a clause providing for a probationary period during which the employer may terminate the employee's employment at its discretion without giving notice would be completely inapplicable if the employee had been poached from his previous employer.

In a case like this, the notice period could be considerable, not least because the employee's length of service with his previous employer would have to be taken into account.

The probationary period would be of no use to the employer, since the right to reasonable time off is a matter of public order.

Another limitation would be that an employer cannot dismiss an employee for discriminatory reasons recognized by the Charter of Human Rights and Freedoms, even if the employee is on probation.

For example, an employer could not dismiss an employee during his or her probationary period for a reason related to that employee's religion or family situation.

Finally, there are all the limits that flow from the general principles of contractual civil liability, such as the fact that the right to dismiss an employee (like all other rights) must be exercised in good faith, without abuse, and in a reasonable manner.

A breach of these rights by an employer could potentially result in an award of damages by the court.

So, I think that covers the limits applicable to the discretion of Quebec employers to terminate the employment of their employees during a trial or probationary period.

Delphine Robert: Thank you. So, in closing, with all these limits that apply to the probation period, I think we can ask ourselves if it's really useful to include one in employment contracts or collective agreements in Quebec?

Marc Ouellet: Indeed, the question is a legitimate one.

It's true that having to justify just and sufficient cause (or serious reason - the two expressions are synonymous) to terminate an employee's employment without having to pay notice, or even to have the right "as such" to dismiss an employee after one (1) or two (2) years of service (depending on whether one is under provincial or federal jurisdiction) greatly affects the usefulness of probationary period clauses in employment contracts.

That said, I think it's still a good idea to have some, mainly for two reasons:

Firstly, a probation clause in an employment contract or collective agreement removes any ambiguity as to an employee's status at the start of his or her employment. In the event of a dispute, this type of clause can definitely "tilt" the case in the employer's favor, since the employee cannot claim that he was unaware that he was being evaluated and that his employment status was precarious.

Secondly, this type of clause indicates how the probation period is to be calculated. For example, is it calculated in calendar days, days worked, etc.?

And what happens if the employee becomes ill or suffers a work-related injury during the probation period? In such a case, would the employer be unable to assess him/her, while the time limits we've seen above continue to run?

However, I think the answers to these questions will have to be the subject of a future podcast...

Delphine Robert: Yes, you're right! Thank you very much Marc for these valuable tips and practical tools for understanding the probation period and its usefulness in the hiring process. If you have any questions about the probationary period, please do not hesitate to contact Me Marc Ouellet or a member of our Montreal employment law group.

Thank you for listening to this episode of Format Légal. Don't forget to follow us so you don't miss the next episode, and to find out more, visit our website gowlingwlg.com to consult all the resources available on the subject.