In the online communities we manage, and during mentoring w/ upcoming and young HR practitioners, these two are the common questions we receive–
“Can probationary period be longer than 6 months?” or “Can we extend the probationary period before the 6th month expires?”
The answer can be found from Supreme Court Jurisprudence (G.R. No 74246, 26 January 1989), also known as Mariwasa Manufacturing, Inc. vs. Leogardo.
On having probationary period for more than 6 months.
Art. 281. Probationary employment shall not exceed six (6) months from the date the employee started working, UNLESS IT IS COVERED BY AN APPRENTICESHIP AGREEMENT STIPULATING A LONGER PERIOD.
Quoting the case of Buiser vs. Leogardo, Jr. (131 SCRA, 151, 156 (July 31, 1984)) the Supreme Court maintained that probationary period that is set for more than the 6 months can be allowed by law:
Generally, the probationary period of employment is limited to six (6) months. The exception to this general rule is when the parties to an employment contract may agree otherwise, such as when the same is established by company policy or when the same is required by the nature of work to be performed by the employee.
The teaching profession is one of the jobs that entails a probationary employment that is more than 6 months.
On extending probationary period before the 6th month expires
SC made a ruling from the same case cited above that probationary period may be extended as an act of liberality to give an employee another chance if the latter failed to meet performance expectations.
Quoting the SC:
The extension of Dequila’s probation (employee) was ex gratia, an act of liberality on the part of his employer affording him a second chance to make good after having initially failed to prove his worth as an employee. Such an act cannot now unjustly be turned against said employer’s account to compel it to keep on its payroll one who could not perform according to its work standards. The law, surely, was never meant to produce such an inequitable result.
By voluntarily agreeing to an extension of the probationary period, Dequila (employee) in effect waived any benefit attaching to the completion of said period if he still failed to make the grade during the period of extension. The Court finds nothing in the law which by any fair interpretation prohibits such a waiver. And no public policy protecting the employee and the security of his tenure is served by prescribing voluntary agreements which, by reasonably extending the period of probation, actually improve and further a probationary employee’s prospects of demonstrating his fitness for regular employment.
Extension of probationary period is not the general rule, lest it becomes a ploy to take advantage of the employee.
Extension can be considered, if factors beyond employees’ control affect his performance. An example is prolonged but valid absences, like miscarriage or forced leave due to operational exigencies. Another example is a sudden negative business or market climate brought about by man-made or natural calamity. This can have adverse effect on sales.
Likewise, since the context of the extended probationary period is “ex gratia” or consideration extended by management– the extension should be mutually agreed by both management and employee, time bound and properly documented (preferably a written request for extension coming from the employee, to be approved by management).
When is extension invalid
In a case involving Dusit Hotel (Hotel Nikko vs. Gatbonton G.R. No. 161654, 5 May 2006), the Supreme Court invalidates the extension effected by the employer.
The SC found that the employer failed to present proof that the employee was evaluated or that his probationary employment was validly extended.
In this case, the employee was hired for a 3-month probationary period, but was extended for 2 more months.
*though the period provided by law is six months, this may be shortened or extended in certain situations by agreement between the employer and the employee.
The employer claimed that the 3-month probationary employment was extended for another 2 months because the employee was not yet ready for regular employment. The employer presented, as proof, a Personnel Action Form containing the recommendation.
But SC noted that the Personnel Action Form (PAF): (1) was prepared only after the proby contract expires, and (2) the PAF was for termination and not extension of probationary employment; (3) the PAF did not contain the results of performance evaluation; (4) the PAF spoke of an attached memo explaining the terms for extension, but the memo was not presented; and (5) the PAF was not signed by the employee.