Trial periods – paying out notice period – Employment Lawyer – Business Lawyer – Dukesons Business Law

September 2019

This Blog isn't legal advice – if you need legal advice on any employment law issue or any other business law or commercial law issue, please contact me. I'm a business lawyer (commercial lawyer) who provides advice on a wide range of business law or commercial law issues including employment law issues.

Yet another blog on employment law.

The Court of Appeal recently looked at the question of whether an employer can pay out a notice period during a trial period. The answer is yes, if the employment agreement provides for this.

The employment agreement in question provided for 4 weeks’ notice of termination. The employer terminated employment based on a trial period provision and elected not to require the employee to work out the required notice but instead, to pay the employee for the notice period

The Court didn’t consider the different question of whether an employment agreement can provide for payment in lieu of notice where there is a trial period. This is a matter that awaits determination by our higher courts. The safest course is to have a trial period that meets the requirements of the Employment Relations Act, that provides for notice to be given, and allows the employer to pay out some or all of the notice period rather than requiring the employee to work for some or all of the notice period. Note that the employment still ends on the termination of the notice period – the employee would remain employed notwithstanding that they aren’t required to attend work.


  • don’t hesitate to contact me if I can help you with employment law or other business law or commercial law issue;
  • subscribe to update alerts (if you don't already get them);
  • feel free to forward a link to this blog to anyone who would be interested
Back to list

2 Enfield Street, Mt Eden, Auckland 1024. PO Box 946, Shortland Street, Auckland 1140.
Telephone: +64 9 379 4556 Mobile: 021 404 306. Fax: +64 9 379 4557 Email: