The regulation of probation and performance management remains one of the most litigated and misunderstood aspects of South African labour law. Employers frequently assume that probationary employees enjoy limited protection, while employees often believe that probation amounts to a guaranteed pathway to permanent employment. Both assumptions are incorrect. 

 

The Code of Good Practice: Dismissal seeks to strike a balance between the employer’s operational need to assess suitability and performance, and the employee’s right to fair labour practices. The publication of the New Code in September 2025 has retained much of the structure of the Old Code, but introduces important refinements which employers, particularly small and medium enterprises, would be well advised to understand. 

 

This article considers the key distinctions drawn by the New Code between probationary and tenured employees, with particular emphasis on probation, post-probation performance management and the practical implications for employers navigating dismissals for poor performance. 

 

A distinction is drawn between probationary and tenured employees in the Code of Good Practice. This distinction was drawn in the Old Code and is drawn in the New Code.  

 

The New Code expressly provides that small employers are not expected to comply with obligations which are not practical or feasible for their operations. It recognises that small employers do not have human resource departments staffed by people with skills and experience and cannot be expected to engage in time consuming pre-dismissal procedures. This proviso is equally relevant to dismissals during or upon completion of probation and post probation, but it is not a wholesale licence for small employers to ignore the provisions of the New Code. 

 

In practice, this acknowledgement of operational realities is significant. Fairness is assessed contextually, and what may constitute a procedurally fair process in a large corporate environment may be entirely inappropriate and impractical for a small business with limited resources. However, flexibility does not remove the obligation to act fairly. It requires decision makers to assess whether the steps taken were reasonable in the circumstances, having regard to the size of the business, the nature of the role and the level of formality that could realistically be expected. 

 

Probation 

 

There are a few differences between the Old and New Code when it comes to probationary employees. 

 

The New Code recognises probation as an important tool for the employer to evaluate the employee’s performance and suitability for employment. It should not be approached as a mere formality or as a mechanism to delay the full protection of the Labour Relations Act 66 of 1995. Rather, it is a structured period intended to allow both parties to assess the employment relationship. 

 

Where probation is treated casually or inconsistently, employers expose themselves to unnecessary risk. A failure to define expectations, provide feedback or meaningfully engage with performance concerns during probation often undermines the fairness of a subsequent dismissal. 

 

What is required by the New Code is that: 

 

• the probation period be determined in advance; 

• the probation period be reasonable in relation to the nature of the job and the time required to assess suitability; 

• the employer give reasonable guidance, which may include instruction, training or counselling appropriate to the nature and size of the employer and the job; and 

• the employee be given an opportunity to make representations prior to any decision to extend probation or dismiss the employee. 

 

The requirement that the probation period be reasonable is particularly important. A period that is too short may deprive the employer of a proper opportunity to assess suitability, while an excessively long probation may be viewed as unfair. The nature of the role, the complexity of the duties and the level of skill required will all be relevant considerations. 

 

The New Code further requires any person deciding on the fairness of a dismissal relating to an employee’s conduct or capacity during or upon expiry of probation to accept reasons for dismissal which are less compelling than those required after completion of probation. 

 

While much of this was already included in the Old Code, the New Code places greater emphasis on probation as a tool to assess both performance and overall suitability for employment.  

 

The New Code also adopts a less stringent approach to the counselling to be given to employees during probation, tying the appropriateness to the nature and size of the employer and the job. 

 

In a footnote, with reference to authority, emphasis is placed on the employer’s right to determine the performance standards and whether the employee has met the performance standards. 

 

There is indeed a long line of authority limiting the court’s interference as to the standards set and whether the employee has met those standards to instances of gross unreasonableness on the part of the employer [see for example ESKOM v Mokoena [1997] 8 BLLR 965 (LAC)], but the emphasis in the Code is relevant. 

 

Arbitrators and courts are not tasked with substituting their own views for that of the employer, provided the standards are objectively defensible, consistently applied and aligned with the operational requirements of the business. 

 

Performance Management (post probation) 

 

As with probation, both the Old and New Codes provide guidelines for the dismissal of employees for unsatisfactory performance after probation. 

 

Dismissals for poor work performance post probation attract closer scrutiny, as the employee has already demonstrated a degree of suitability for the role. The employer is therefore expected to engage substantively with the causes of underperformance and to afford the employee a meaningful opportunity to improve. 

 

What is required by the New Code is: 

• The employer must have given the employee appropriate evaluation, instruction, training, guidance and counselling; 

• After a reasonable period for improvement the employee must continue to perform unsatisfactorily; and 

• The employee must be given an opportunity to respond to allegations of unsatisfactory performance prior to dismissal. 

 

The New Code further requires any person deciding on the fairness of a dismissal for poor work performance to consider: 

 

• Whether the employee failed to meet a performance standard; 

• If the employee did not meet a required performance standard whether or not: 

• the employee was aware, or could reasonably be expected to have been aware, of the required performance standard; 

• the employee was given a fair opportunity to meet the required performance standard; 

• the required performance standard was reasonably achievable; and 

• Dismissal was an appropriate sanction for not meeting the required performance standard. 

 

The New Code provides that in certain circumstances an employer may not be required to warn an employee that they may be dismissed if their performance does not improve. Specific examples are cited: 

 

• managers and senior employees whose knowledge and experience enables them to judge whether their performance is adequate; and 

• employees with a high degree of professional skill where a departure from that high standard would have severe consequences justifying dismissal. 

 

The New Code does not expressly state that the procedure leading to dismissal should include an investigation to establish the reasons for the unsatisfactory performance and that the employer should consider other ways, short of dismissal, to remedy the matter, as the Old Code did; however, some form of investigation is likely to be necessary to ensure that the employee is given appropriate evaluation, instruction, training, guidance and counselling. Moreover, a consideration of whether dismissal is appropriate would include a consideration of other ways short of dismissal to remedy matters.  

 

The New Code now expressly states that the performance standard must have been reasonably achievable. This simply codifies what arbitrators would in any event have considered under the Old Code. Failing to meet an impossible standard could never amount to a fair reason for dismissal. It also reinforces that although there is a limit to which arbitrators and courts will interfere with the standards set and whether the employee has met those standards those standards must be reasonably achievable and not grossly unreasonable. 

 

The emphasis in the New Code that employer’s may not need to warn managers, senior employees and employees with a high degree of professional skill is consistent with a long line of authority [see for example Somyo v Ross Poultry Breeders (Pty) Ltd [1997] 7 BLLR 862 (LAC)] but the emphasis is nevertheless relevant. 

 

Conclusion 

 

While the New Code appears to relax certain procedural expectations, particularly in relation to probationary employees and small employers, it does not dilute the core requirement of substantive and procedural fairness. Employers remain obliged to act reasonably, transparently, and in good faith when dealing with issues of performance. 

 

Probation and performance management continue to be fact-specific enquiries, heavily influenced by the nature of the role, the size of the employer, and the context in which decisions are taken. Missteps in this area frequently result in avoidable disputes and adverse awards. 

 

Employers are therefore encouraged to approach probation and performance management proactively and to seek proper advice where uncertainty exists, particularly before taking decisions that may result in dismissal.