Limited duration contract of employment vs probation period

Limited duration contract of employment vs probation period

In most instances uninformed employers use limited duration contracts of employment together with probation period in reservation and securing their right to terminate the employees’ employment should they not wish to continue with the employment further.

Read more here about probation: What does probation really mean? 

There is nothing inherently objectionable about parties concluding a limited duration contract of employment, where the actual duration is determined either by the agreed period of time or by the completion of specified work but the work rendered must be of a temporary nature. It may be understandable why an employer may not want to take a risk of hiring an employee permanently and thereby resorting to limited duration contract of employment coupled with probation period in avoiding the responsibility or inevitability of having to retrench, which is a lengthy process with financial implications for the employer as well as future employment of other potential employee(s). At labour law, such a practice is abusive of among others, the principle of probation period because it falls outside of the purpose of the said principle as it deprives the employees of their permanent employment.

Schedule 8 of Code of Good Practice, dismissal item 8(1)(b) of the Labour Relations Act 66 of 1995 states that the purpose of probation is to give the employer an opportunity to evaluate the employee’s performance before confirming the appointment. It is clear from the purpose of probation that it cannot be used on a temporary appointment. This argument is in line with paragraph (c) of same Code, which states that probation should not be used for purpose not contemplated by this Code to deprive employees of the status of permanent employment. For example, a practice of dismissing employees who complete their probation periods and replacing them with newly-hired employees, is not consistent with the purposes of probation and constitutes an unfair labour practice.


Sekhobe Abe Mopedi is currently a SEESA Labour Senior Legal Advisor. He obtained his LLB degree in 2007 from the University of the Free State. He’s been employed by SEESA for the past 8 years.


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