The cost of hiring the wrong person can be difficult to quantify in monetary terms but it is high. So, the introduction of trial period legislation was welcomed by many employers last year. The trial period is designed to encourage small businesses to recruit without fear of legal action if things don't work out.

Employers with 19 or less employees can include a 90-day trial period into the employment agreement for a new employee (who has not previously been employed by the employer). It is then possible to dismiss an employee within that period without possibility of a personal grievance on the basis of unjustified dismissal.

The introduction and subsequent use of trial periods has been controversial. The Government's recent proposal to extend the 90-day trial period to cover all employers (i.e: those with 20 or more employees) has sparked a 'name and shame' campaign by the CTU of employers who have allegedly used the trial period to fire employees without good reason.

The trial period legislation is still fairly new and untested. Clearly there are risks associated with using it willy nilly - just because there is no requirement to provide an explanation to employees when you are dismissing them within the trial period doesn't mean that you should not have and give one. So much that's invested in building a strong company culture based on valuing employee contributions can be undone by letting someone go in what is perceived by an employee's colleagues as an unfair manner. Even when employees are not directly impacted by terminations they watch their employer's actions very carefully and make an assessment about how they would be treated in a similar situation. The impact on employee engagement can be just as risky as non-compliance.

What do you think? Do you agree or disagree? Post a comment below.