90-Day Trial Periods: Getting It Right Before the First Shift

Can you take on a summer labourer and let them go after a few weeks if it isn’t working out? Yes, if you use a 90-day trial period and get two things right: the worker signs the agreement with the trial clause before their first shift, and you give notice before day 90 ends. Miss either one and the trial gives you no protection at all.

A 90-day trial period is an optional term in an employment agreement, set by sections 67A and 67B of the Employment Relations Act 2000. That Act is New Zealand’s main employment law. The Ministry of Business, Innovation and Employment (MBIE) administers it, and the Employment Relations Authority decides disputes under it. Nobody has to use a trial. If you do use one, its conditions are compulsory. A valid trial lets you end the employment within the period without facing a personal grievance for unjustified dismissal.

Any employer can use one again. From May 2019 the law limited trials to employers with fewer than 20 staff. The Employment Relations (Trial Periods) Amendment Act 2023 lifted that limit from 23 December 2023.

The four conditions a 90-day trial period has to meet

Section 67A sets the rules, and the courts read them strictly. In Smith v Stokes Valley Pharmacy, the Employment Court said that because the sections remove “longstanding employee protections”, they “should be interpreted strictly and not liberally”. So treat each condition as a pass or fail:

1. The person has never worked for you before. The Act allows a trial only with “an employee who has not previously been employed by that employer”. Last summer’s casual, a returning seasonal worker or a former apprentice can’t go on one.
2. You write the trial into the employment agreement. It must say that the worker serves a trial of a set number of days, no more than 90, starting on their first day. It must also say you may dismiss them during that time, and that they then can’t bring a personal grievance about the dismissal.
3. The worker signs before work starts. MBIE is blunt about this: “If the employee does not sign the employment agreement before they start work, the trial period is not valid.”
4. You give notice inside the 90 days. The last day can fall after day 90, as long as you gave notice during the trial.

The other legal requirements still apply on top. Every employee needs a written agreement, and you must keep a signed copy. Failing either can bring a $1,000 infringement fee.

Getting the paperwork done before day one

This is the step the case law turns on. The pressure in October and November is to get someone on the tools next week. The agreement turns up on the first morning, the worker signs it on the bonnet of the ute, and the trial is already gone.

In Blackmore v Honick Properties, the worker had started work before he saw or signed the agreement with the trial clause. The court held he was already an employee at that point. So he had been “employed by it previously”, and the trial couldn’t apply. The court also found he became an employee for these purposes when he accepted the job offer.

The order that keeps the trial intact

1. Send the written agreement with the offer. Section 63A of the Act requires you to give the person a copy of the intended agreement when you propose a trial. You also have to tell them they can get independent advice, and give them a reasonable chance to get it.
2. Check the trial clause covers all three parts listed in condition 2. MBIE’s free Employment Agreement Builder is a reasonable starting point, but read what it produces.
3. Collect the signature before the start date, and keep the copy on file where you can find it.
4. Don’t run a paid try-out day first. MBIE’s guidance on pre-employment trials says asking a candidate to show a skill briefly is fine, but working “a whole shift, or even a few hours, would likely be considered employment”. A worker who did a paid day last week has already worked for you.
5. Put the day-90 date in your diary with a couple of weeks’ margin. Count from the first day of employment.

One more check before you offer a trial. MBIE says Immigration New Zealand does not allow trial periods for workers on an Accredited Employer Work Visa. For those hires, a probationary period is the tool to use.

Trial, probation or fixed term: which one fits a summer hire

People mix these three up, and each one does a different job.

A trial is for testing a brand-new person in an ongoing job. Inside the 90 days, a valid trial removes the unjustified dismissal grievance. It doesn’t remove your other duties. The worker gets at least the minimum wage, which is $23.95 an hour for adults from 1 April 2026. They also get holidays, health and safety cover and access to mediation, like anyone else on your books. Payroll duties such as KiwiSaver apply exactly as they would for any other employee.

A probationary period, under section 67, can run for any reasonable length. It can also apply to someone who has worked for you before. But it doesn’t change the law on unjustified dismissal. To end the job at the end of probation, you need a fair process. That means a fair assessment, telling them what isn’t good enough, warning them the job is at risk and giving them a chance to improve. MBIE also notes that you can’t use a probationary period after a trial.

When a fixed term fits better

A fixed term, under section 66, is for work that genuinely ends. A summer landscaping crew taken on until Easter may be one. You need a genuine reason, and you have to write into the agreement how and why the job ends. The Act rules out one reason in particular: testing whether someone suits a permanent job. So a fixed term can’t stand in for a trial. A fixed-term agreement can still include a trial, but only for someone who hasn’t worked for you before. On a fixed term of under 12 months, you can agree to pay the 8% holiday pay with each pay, or at the end.

For a returning seasonal worker, the choice is a fixed term or a permanent job with probation. A trial isn’t available to them.

Ending a 90-day trial period properly

If it isn’t working, the way you end it decides whether the trial protects you. Section 67B covers this part.

1. Decide before day 90, not on it. Notice given after the trial has ended doesn’t count.
2. Give real notice. In Smith, the court said notice is “advice of when, in future, the dismissal will take effect”. Use the notice period in the agreement. If the agreement doesn’t set one, give reasonable notice. You can have them work it out or pay it in lieu.
3. Put it in writing, with the date of their last day.
4. Pay out everything you owe in the final pay, including the notice period if you pay it in lieu, and holiday pay.

Never write “termination may be immediate” into a trial clause. In Cradock v Allied Investments, a clause saying the notice period would not apply to a trial dismissal was found to breach the notice rule. The whole trial was invalid. The Authority ordered the employer to pay $7,662.59 in lost wages and $15,000 in compensation.

During a trial dismissal you don’t have to put your concerns to the worker before deciding. You also don’t have to give written reasons if they ask. Good faith still applies in every other way, so don’t mislead them about why it’s ending.

What the worker can still raise

A valid trial blocks one kind of claim, not every claim. The wording in force since 21 February 2026, set by the Employment Relations Amendment Act 2026, bars a grievance for unjustified dismissal. It also bars one for unjustified disadvantage, if that relates to the dismissal. It doesn’t touch disadvantage unrelated to the dismissal. Nor does it touch discrimination, sexual or racial harassment, or the other grounds in section 103. Claims about unpaid wages or holidays sit outside it too.

And if any of the four conditions failed, none of the protection applies. MBIE lists the usual ways that happens: the notice was short, work started before the agreement was signed, the worker had no reasonable chance to get advice, or the agreement never mentioned the trial. In those cases the worker can bring an unjustified dismissal grievance, the same as any other employee.

So a 90-day trial period is worth using, as long as you treat it as paperwork you finish before the person turns up. With Christmas and New Year ahead, our guide to what you owe a crew who works Labour Day walks through the public holiday rules that apply to new staff too. More employer guides are in our New Zealand business admin section.