ALIGNING PEOPLE WITH PROFITS: A COMMERCIAL AND LEGAL PERSPECTIVE TOWARDS MANAGING EMPLOYEE PROBATION IN ZIMBABWE

Businesses are interested in making a profit and unlocking shareholder value. On the executive table, an HR professional must be a business leader first before becoming an HR professional. This implies that HR must drive business performance through people. HR must be able to drive value through people. In this vein, when managing employee probation, HR must provide expert solutions on how to manage employee probation in a way that will enable the business to generate value whilst at the same time remaining within the legal dictates of the law.

Building the HR business case

HR must show how effective management of probation impacts bottom-line performance and key business outcomes. The key business outcomes include profitability, project completion, costs, delivery time, sustainability, growth, productivity, and sales. All this can be tracked through measurable metrics such as earnings per employee, revenue per employee, cost per employee, and output per unit. If it is in the Agriculture industry key metrics can include yield per hectare, labour days per month, feed conversion ratio, average bird weight, and total irrigated land size per month. In the manufacturing industry, key metrics include plant availability percentage, waste percentage, revenue per product, revenue per customer, Lost Time to Injuries, and Average daily output.

In articulating the HR business case, you must be able to show a What-if scenario like this. If a Production Controller fails to meet his daily target of producing 200 000 units per day by 15 % during probation because he will be learning the job, what will happen to revenue per day? What is your limit of acceptance for such failure to meet targets during probation? You should have such targets being spelled out being able to calculate the relationship between such factors. 

So many reputable voices in HR and Labour Law have written so extensively on probation but they fail to tackle the business perspective of issues. Most of the articles and scripts are written in specialized jargon that has a compliance-based approach. They follow an “If you do not comply with the law, then we will get punished” approach. My experience with this approach has been disastrous because other business managers often ask these questions, “What if we don’t get caught?” “What is the price of us not complying with this? We can easily pay off such a fine, it is a small amount of amount.” 

To solve this, HR professionals must show sound business acumen when handling people matters because the main language that the entire executive team easily understands is money. In one of the business meetings that I attended I managed to articulate such a case by indicating that we are in business to make money. We need to make responsible money and not benefit by eating from a chalice laced with our employees’ sweat and blood. We need to build a reputable brand with a positive value to the communities that we serve and the people around us.

In other business meetings, I manage to articulate the HR case by showing the business value of managing the issue according to best HR practice. What is the cost of doing this way? How much are we going to make out of this? What will happen to our talent attrition levels or productivity levels? As you read through this article and managing probation, always remember that you are a business professional who must articulate the business case from a people-driven viewpoint.

. What is employee probation?

 Probation is a period by which an employee assesses an employee’s skills, knowledge, ability, and fitness for the job for a given period. According to the Labour Act Chapter 28.01, section 12 (5) probation is a period that may be provided in writing and is for a single, non-renewable period. This means that probation cannot be renewed or extended.

More so, probation is one day for casual work or seasonal work contracts or three months in any other case. You cannot give an employee probation that is less than or more than this stipulated period. Any contractual clause that goes against this, will be regarded as null and void since it will be in ultra vires with the law.

What is a probationary employee?

Madhuku (2015:44) defines an employee on probation as follows,

“A probationary employee is one who is in the initial period of his or her employment where his skills or abilities are being assessed. Probationary employment is separate from the second employment contract which is conditional on successful completion of the probation.”

Such employees will be settling into the company and they require extra support from management and their co-workers for them to be able to quickly add value to the business.

Is probation renewable or not?

At some point, I got a call from someone who was not satisfied with employee performance and they felt that three months’ probation given was not enough to assess an employee’s performance. To address this, they wanted to extend the employee’s probation. My response was crystal clear, “It may make a good business case to extend probation as it will allow you to make a further assessment of the employee’s performance before you commit to a permanent contract. The unfortunate part is that our local labour law does not allow for the extension of probation. Section 12 (5) of the Labour Act Chapter 28.01 prohibits the extension of probation.”

What are the implications of extending an employee’s probation?

There is a risk of financial loss because the employee can sue the company is in the case of St Giles Medical Rehabilitation Centre versus Patsanza SC 59/18. In this case, the employer was made to reinstate the employee with full salary and benefits.

There are also other non-financial costs such as reputational loss, loss of productivity time, and risk of a decline in employee engagement

 Common mistakes made by employers and how to avoid them

1.   They do not objectively measure probation

One of the biggest challenges that employers do is that they do not measure probation objectively. Employees are not given clear targets and they do not know what is expected from them. Management on the other hand does not know how to measure employees on probation. In the end, probation becomes a political game whereby he who plays politics well, will pass probation.

The main danger of not measuring probation is that employees will let go of high potentials and performers at taking in poor performers. Having a team without the right skill set, knowledge and attributes is a silent poison that kills your cash in the company.

Employers must therefore be able to set smart probationary objectives and track them effectively. Employees must be made aware of these objectives and they must sign fr them.  I have attached a copy of a probationary contract along with this document for you.

2.   They do not track probationary periods

Quite often employers do not track employee probation dates and only realize this when the time would have lapsed. This then creates complications and explanations which employers often fail to argue against. It is therefore important to have an employment contract tracker which tells you which contract needs to be renewed and which does not need to be renewed. You can do that manually using Microsoft Office Excel or through Morden HR Information systems.

Failure to track probationary periods can lead to several challenges especially when the employer wants to terminate a contract on failure to complete probation. In the case of Gumbo versus Air Zimbabwe, an employee was on probation and his contract was not renewed. The employee continued to work without an employment contract. The employer sought to terminate the employment through failure to complete probation. The employee refused to state that he was already a permanent employee. The matter was referred to the court and it was held that the employee was on a three-month contract because the contract was tacitly renewed to previous terms and conditions of employment.

You will never want to go through such complications in court to prove the legality of your actions. Your main purpose as a business is to make money and unlock shareholder value! There is no need to spend much of your time in court attending to labour issues. You must get things right and have a clean industrial relations record.

3.   Lack of feedback

Some managers do not give employees on probation feedback related to how they (employees) are performing. Research by Bamboo Hr has shown that a third of your new joiners who leave within the first six months are because of poor induction and onboarding. This happens during the time of probation where you do not support them by giving them feedback.

Research by Price Water Coopers has also shown that over 51% of millennials are not satisfied with jobs because of a lack of constant feedback on how they are performing. It is therefore important to stimulate performance through giving constant feedback to an employee during the probationary period. Do not wait for three months to correct what is wrong. Have continuous one-on-one sessions and comment on tasks given on issues related to how employees are performing. Do not just focus on where they are going right, also focus on where they are going wrong.

4.   They do not put terms of probation in a contract of employment or a legally binding document

Some employers get it wrong by not including probationary terms in an employment contract or any legally binding document. Whilst it is the employer’s right to terminate a contract on probation without giving a lot of reasons, it is more solid to include probation terms. You may need to indicate key terms such as your expectations for the employee during probation. What should they achieve? What should they stop? What should they implement? What should they initiate?

Clarity of purpose is more important if you are to get the best out of probationary employees. You must not play guerrilla warfare tactics with your employees because the employment relationship is based on trust and mutual understanding.

5.   They make use of halo-effect

A halo effect is a situation where you favour or disfavour one attribute of an employee to the extent that it obscures your judgment. In some cases, employers may favour the mediocre performer who smiles at everybody in the office ahead of the High performer who is calmer and quieter. Do not mistake being nice or being eloquent with performance. Results do not lie. Focus on deliverables that are measurable and trackable.

6.   Most recent events may take precedence over past key events

In some cases, I have seen employers having recent events taking precedence over other events that happened during the probationary period. I had to painfully see an employee leave a company on grounds that they failed probation by one event that had no financial impact on the business. The employee was a High Potential and had surpassed all the targets set during the probationary period but was let go after he failed to submit one report on time.

7.   Unilateral decision making

It is known that if power rests on one individual, then there is the likelihood of abusing it or making regrettable decisions. You may let go of good talent because only one person determines who stays or not. To close this gap, you may need to make sure that an employee’s successful completion of probation can be determined by a panel made up of the HR Official, Line manager, and a neutral manager. This will help you to dilute the power that might rest on one individual. Make sure that this is included in your HR policies and Standard Operating Procedures. They must be approved up to the CEO or Board level depending on your company structure so that everything becomes above board.

 Conclusion

Thank you for taking your time to go through this article. This article was meant to share knowledge and was written in my capacity. I accept no liability for any possible inconveniences, loss, or whatsoever that you may suffer because of this article. Always remember that you are in business to make money! It is therefore critical to align your people processes and procedures including managing probation with key business outcomes. Stay inspired.

The writer is called Farai Mugabe. He holds a master’s degree in Strategy and Governance and a BSc. Human Resource Management (Honours) degree. He is also an MSc. In Human Resource Management Degree candidate. He is a top graduate from Midlands State University. Farai was awarded two coveted academic awards by Midlands State University and these are, The MSU Book Prize and The T & H award for the best male student in the HR Management department.

Farai is a performance enabler and process designer who helps to align people’s hearts, minds, and hands with Key Performance metrics such as Revenue per employee, revenue per customer, Sales per employee, and Employee Engagement Index. He has hands-on experience in KRA and KPI setting, performance coaching, and evaluation of performance. Farai is a result-driven individual who has a strong passion for people and strategy issues. He is strong-willed and transformative in approach. During his post-graduate studies, Farai focused on boosting the productivity of knowledge workers within Zimbabwe’s technology-based firms. This article reaffirms his undying love for Strategy and people!

He is a published author of a novel called Midnight Mission and a career management book called Manage your Career like a business! He also has hands-on experience with managing labour relations and ensuring that a stable industrial relations climate is established. To date, Farai has a clean Industrial Relations record and has a passion for HR Technology.

He is currently working as a Group HR for a Medium enterprise company called ArkTrust Investments where he oversees HR operations for the following business units; Fairview Properties, SunCrown Estates, Ark construction, and Black Bird Precession Security. He has also worked for top organizations such as Lobel’s Bread, Midlands State University, Econet Wireless, and Webdev Online Solutions. He has initiated, developed, facilitated, and implemented several key initiatives that have impacted bottom business performance including the following.

·        Designing and implementing an employee engagement survey which sort to measure a company’s employee engagement index

·        Introducing an HR Metrics based Group HR report which tracks metrics such as earnings per employee, days worked per employee, critical staff turnover, voluntary staff turnover, and training hours per employee

·        Introducing a data-driven performance management approach to agribusiness operations aimed at enhancing production outcomes such as yield per hectare and number of new products introduced per year

·        Introduced an Electronic Compensation Management Toolkit (EMCT) which enabled the business to measure and track their salary and benefits competitiveness as benchmarked by at least ten competitors and similar companies on the market

·        Introduced a succession planning model which was meant to create sustainability of company operations by developing a talent cover ratio of 2 employees on talent bench for every 1 critical position

·        Initiated the adoption of an HR Information system meant to access HR data and employee personal information by the click of a button

·        Designing the Ignite Innovation Program meant to promote companywide innovation

·        Resolved a one-month long-standing dispute on unfair dismissal dispute between the business and an aggrieved former employee. The dispute had a potential cost of over US$20 000 to just US$744.00.

·        Designed the ‘Build and Deploy HR Strategy’. This strategy is anchored on the following pillars: Cost management, Business alignment, Business speed, Regulatory compliance, and Employer rand management

·        Ensured statutory compliance through the provision of safety clothing within three months of working.

In this article, Farai explains how to effectively manage probation using profited oriented, and legally sound approach. Farai unpacks this issue in logical flow with a deep analysis. He writes in his capacity and this article was written for sharing insights and academic purposes only. Therefore, he accepts no liability for any injuries, inconveniences, or whatsoever that this article might cause. He can be reached at the following email address: [email protected]