Employees in USA must complete a probation period when they begin employment. During their probationary periods, employees are not entitled to the same rights and benefits that an employee who has passed their probation period would be.
Probationary periods are common practice in US employment relationships. While not directly mandated by a specific federal law, they fall under the broader framework of employment contracts and the concept of “at-will employment.” This means that, in most states, employers and employees can typically terminate the relationship at any time, with or without cause (with exceptions like discrimination laws still applying).
This is a designated period at the start of employment where both the employer and employee assess whether the job is a good fit. Employers evaluate the new hire’s performance, skills, and overall suitability for the company. Employees use this time to decide if the company culture and job duties align with their career goals.
A 90-day probationary period is the standard practice in the United States. Probationary periods can be shorter or longer, at the discretion of the employer. With many employment agreements being considered ‘at will’, many US employers have no need to use probationary periods when assessing the suitability of new hires.
Probationary periods should be clearly detailed within an employment contract. This contract outlines the period’s length, expected performance standards, and procedures for evaluation.
However, there are different types of employment contracts that can be used:
Explicitly outlining the probationary period within the employment contract, regardless of the contract type, provides clarity for both parties.
Unique Probationary Period Regulations in Montana
Montana stands out with employment laws distinct from the at-will standard common in most US states.
Unless otherwise specified, a new hire in Montana automatically has a 12-month probation period (Mont. Code Ann. § 39-2-910). Effective last year, October 1, 2023 , Montana adopted a new rule where employers can terminate employees at will during the first 12 months of employment unless a different period is stipulated in the contract.
However employers in Montana must have “good cause” to terminate an employee within their probationary period (Mont. Code Ann. §§ 39-2-904, 39-2-905). This means they need a justifiable reason and supporting documentation for the termination.
Even during a probationary period, employees are protected by fundamental workplace laws in the US. These rights include:
It’s crucial for all employers to have a solid grasp of the laws that dictate their responsibilities. Let’s break down some of the important areas:
Discrimination in the workplace is illegal. It’s essential to understand protected categories and ensure your hiring, promotion, and termination practices are free from bias.
Be aware that various other federal laws, or even more stringent state laws, might expand the protections against discrimination based on pregnancy, genetic information, military status, and other factors.
The Fair Labor Standards Act is the cornerstone on minimum wage, overtime, and child labor rules. Some states have even stricter requirements, so stay informed!
Payroll mistakes can be costly. Make sure you have accurate systems for timekeeping and wage calculations.
The Occupational Safety and Health Act requires employers to provide a hazard-free workplace. This involves identifying potential risks, training employees, and maintaining safety protocols.
Don’t just meet minimum standards, strive for a safety-conscious culture that protects your employees.
The Family and Medical Leave Act provides eligible employees unpaid leave for serious health conditions, caring for a new child, or certain military-related reasons.
Understand eligibility rules and how to manage leave requests while maintaining operations.
Employers have numerous tax-related obligations to federal, state, and sometimes local tax agencies. Proper I-9 verification procedures are mandatory.
And providing coverage for work-related injuries or illnesses is required in most states.
Key Questions for Employers:
While probationary periods are not mandatory in most of the US, they offer significant advantages for both employers and employees. For employers, these periods provide an opportunity to evaluate new hires’ skills and suitability within the actual work environment. This allows them to identify and address potential performance issues early on.
Employees also benefit from probationary periods. They gain a chance to assess whether the job and company culture align with their expectations. Additionally, this period offers a valuable opportunity to learn job duties, adapt to the company’s way of working, and demonstrate their potential.