Transparent and Predictable Working Conditions Regulations 2022 – Key Changes to Probationary Periods

The Transparent and Predictable Working Conditions Regulations 2022 (“the Regulations”) came into effect on 16 December 2022. The Regulations transpose the EU Directive 2019/1152 on Transparent and Predictable Working Conditions (“the Directive”). The Regulations amend a number of pieces of existing employment legislation, to include the Terms of Employment (Information) Act 1994, the Organisation of Working Time Act 1997, the Workplace Relations Act 2015 and the Protection of Employees (Fixed Term Work) Act 2003.

The purpose of the Directive was to provide transparency in working arrangements and protection to those employees on less secure contracts, for example, temporary contracts or gig economy workers. However, the Regulations apply to all employees.

Given that the Regulations apply from 16^th December 2022, this is an opportune time for employers to understand the changes introduced and to review existing HR practices and documentation to ensure compliance with the Regulations.

The Employment Team at RDJ LLP is, as always, helping our clients to navigate the changes which the Regulations have brought about. One area of real concern for employers is that of probationary periods and any changes that need to be considered on foot of the Regulations.

The purpose of this Insight is to outline the legal changes to probationary periods and what employers need to do now to make sure they are fully compliant with the new law in this area.

Key Changes to Existing Legislation

The Regulations make a number of amendments to the Terms of Employment (Information) Act, 1994 (“the 1994 Act”), which is the legislation that requires employers to issue employees with written statements of their terms and conditions of employment.

The Regulations insert new provisions into the 1994 Act dealing with probationary periods, which can be summarised as follows;

1. The Regulations provide that probationary periods in the private sector cannot exceed 6 months (and for public servants, cannot exceed 12 months). However, the Regulations also provide that probationary periods can on an exceptional basis be longer than 6 months provided they do not exceed 12 months and it would be in the interest of the employee to extend.

In practice, what this means for employers is as follows;

• If a probationary period is to be extended, then the extension should be on an exceptional basis – in other words, it should be the exception, and not the norm, in your organisation to extend probationary periods (which is a consideration not specific to the individual employee), and,
• In relation to the specific employee, the extension should be for no longer than a further 6 months (and the RDJ Employment Team would advise you to never extend beyond 11 months in practice) and it should be in the interest of the employee to extend (presumably, if the alternative to extension is termination of employment, it will be in the employee’s interest to extend).

Some commentators are suggesting that “exceptional circumstances” are required to extend probationary periods – but that is not in fact what the Regulations state – they provide for “an exceptional basis”, which is quite different as outlined above.

2. The Regulations also amend the Protection of Employees (Fixed Term Work) Act, 2003 and provides that, where an employee is employed under a fixed term contract, the length of any probationary period must be proportionate to the expected duration of the fixed term contract and the nature of the work. Furthermore, where an employer proposes to renew a fixed term contract for the same functions and tasks, the further fixed term contract shall not be subject to a new probationary period.

In practice, what this means for employers is as follows;

• If a fixed term contract is, for example, for a fixed period of one year, a proportionate probationary period might be three months, as opposed to the usual 6 months in a permanent contract.
• Where an employer is renewing a fixed term contract, if it is for the same functions and tasks, no probationary period should be inserted to the renewal.

3. The Regulations provide that where, on the commencement date of the Regulations, which was 16^th December, 2022, an employee in the private sector is already subject to a probationary period which exceeds 6 months and the employee has completed at least 6 months of that probationary period, the probationary period will expire on the earliest of two dates – the date on which the probationary period is due to expire under the contract or the 1^st February 2023.

In practice, what this means for employers is as follows;

• If you have an employee who commenced employment before the 16^th December 2022 and was subject to a probationary period longer than 6 months, and has completed at least 6 months service with you, their probation will now expire on 1^st February 2023, if that date is earlier than the end of the contractual probationary period.
• You need to urgently review any employees in this category (which will be limited in our view) to determine if they are going to pass probation or not.

4. The Regulations provide that where, in accordance with a specified provision, an employee is absent from work during the probationary period, the period shall be extended by the employer for the duration of the employee’s absence. The term specified provision has then been defined under the Regulations, to mean the following;