Toronto, ON — June 10th, 2026 — When early employment issues arise, one assumption surfaces repeatedly: “If they’re still on probation, we can let them go, no risk, no notice, no problem.”
In this third installment of Dear Counsel, we take a closer look at that belief, and why it can create legal risk for employers.
Here’s a question we hear often:
“Dear Counsel,
We hired an employee about two months ago, and things aren’t working out. They’re still within their probationary period, and we don’t think they’re the right fit. Can we terminate them without notice or severance?”
This raises one of the most common misconceptions in employment law.
Let’s unpack it.
Probationary Periods: A Matter of Contract, Not a Legal Default
Start with this:
Ontario law does not create an automatic probationary period. “Probation” exists only if it is clearly set out in the employment contract.
So, if the contract does not contain an enforceable probation clause, the employee is not legally on probation – regardless of the employer’s intention. Simply calling someone “probationary” in conversation or in a handbook is not enough.
In short, probation is created by contract, not by assumption.
What Does Probation Actually Do?
A well-drafted probationary provision can give employers added flexibility in exiting the employment relationship, but it is not necessarily a “free pass” to terminate an employee during the probationary period.
As noted previously, the standard for terminating a non-probationary employee without notice or pay is just cause; for a probationary employee, the focus is suitability.
Typically, a probation clause allows an employer to terminate employment if the employee is found unsuitable, based on factors such as:
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- Deficient skills or performance;
- Unreliable conduct or attendance; or
- A poor fit within the work environment.
Even with a valid probation clause, the employer must act in good faith. The decision to terminate must reflect a genuine assessment of suitability, and the evaluation process should be honest, fair, and non-arbitrary.
Courts have made clear that probationary employees cannot be dismissed for improper or discriminatory reasons disguised as concerns about “fit.”
Things to Keep in Mind – The Clause
A probation clause should confirm that the parties agree the employee will be subject to probation for a defined period. While additional detail is not strictly required, the employer may also specify:
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- The employer’s right to terminate employment without notice or pay in lieu during the probationary period as permitted by the Employment Standards legislation; and
- The standard by which the employee will be assessed, and on which termination without notice may be based.
Beyond including a probation clause in the contract, employers should evaluate the performance of the employee during the probationary period so any termination is not a total surprise to the employee.
What About Notice? ESA Minimums Still Apply
This is where many employers are caught off guard. The parties may agree on any probation length, but in practice it should reflect the time reasonably needed to assess whether the employee is a good fit. Longer periods are more common where the role involves extensive training or time to learn the role. Longer probationary periods are typically not more than 6 months.
Unless a longer assessment period is necessary, the chosen probation length often aligns with the point at which statutory termination entitlements arise. Under Ontario’s Employment Standards Act, 2000:
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- Employees with less than 3 months of service are not entitled to statutory notice;
- Employees with 3 months or more of service, ESA notice obligations begin.
But two important points are often overlooked:
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- If the probation clause is not properly drafted and unenforceable, the employee will be entitled to common law reasonable notice, even early in the employment relationship.
- A probation clause must be carefully drafted to limit entitlements; otherwise, the employer may owe more than expected.
In short, probation may reduce risk, but it does not eliminate it unless properly implemented.
“It’s Just Not a Fit” – Is That Enough?
Potentially, but context matters.
Courts generally accept that probationary employees are being assessed for suitability. Still, employers should be able to show that they:
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- Made a genuine effort to assess the employee;
- Gave the employee a real opportunity to demonstrate suitability; and
- Reached an honest and reasonable decision.
For example, in Nagribianko v. Select Wine Merchants Ltd, 2016 CarswellOnt 490, the court found that the employer terminated the employee after assessing his performance during the agreed six-month probation period and concluding that he was unsuitable. There was no evidence of bad faith, and nothing suggested he had been denied a fair opportunity to prove himself. Looking at the full six-month period, the court was satisfied the employer had taken the time to make a proper assessment. By contrast, a rushed, unsupported, or inconsistent termination can be challenged, even during probation.
Common Pitfalls
We often see problems where employers:
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- Assume probation exists automatically, even without a contract;
- Rely on vague or unenforceable probation clauses;
- Terminate abruptly, without meaningful assessment or feedback;
- Use “probation” to conceal unrelated concerns; or
- Overlook that human rights obligations still apply as probation does not override them.
Probation can offer flexibility, but only when it is used properly.
Key Takeaways for Employers
Before terminating a probationary employee, ask:
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- Do we have a clear and enforceable probation clause?
- Have we meaningfully assessed suitability?
- Is our decision honest, reasonable, and documented?
- Are we meeting our ESA obligations, if applicable?
- Could a protected ground (for example, disability) be a factor?
When in doubt, pause and get advice.
Early-stage terminations may seem low-risk, but mistakes can quickly become claims.
Dear Counsel will return soon with another question from the inbox.
In the meantime, if you need help reviewing employment contracts, drafting enforceable probation clauses, or managing early-stage terminations, Protea LLP is ready to assist.
Let’s address it before it becomes a claim.
