Workplace trials in New Zealand

MyHR team
By MyHR team

work trial cafe

We often receive queries about the use of workplace trials or tests during the hiring process: should they be paid or unpaid? Involve real tasks or simulations? One hour, a day, or a month-long?

Unfortunately, some of the information that people believe about workplace trials isn’t accurate and presents risks for employers. Because while workplace trials are a great recruitment tool for assessing potential employees, it's important to approach them carefully to ensure fairness and compliance with employment legislation.

In this blog post, we'll explore why it's crucial to be thorough when conducting workplace tests and highlight key factors to consider during the trial process.

The business can’t benefit financially from the trial

During a workplace trial, it's vital to remember that the business shouldn't gain financially from the tasks the candidate undertakes, so don’t get a person to do work that one of your paid employees would typically do.

For example, if you’re trialling candidates for a role as a barista, you can ask them to make a coffee for themselves or the hiring manager, but not for your paying customers. This helps ensure that the trial focuses on the task at hand or the skill you’re assessing and makes it clear that the candidate isn’t an employee on a ‘try before you buy’ approach.

This has been well established by case law. One notable case (known as the ‘Salad Bowl Case’) involved a job applicant completing a 3-hour work trial over the course of 2 days, where they wore the company uniform and completed various tasks - such as prepping salads, cleaning, attending to customers, and handling payments - that would normally have fallen to a paid employee.

In the Employment Relations Authority’s ruling (which was upheld by the Employment Court) the applicant was found to be performing work and contributing to the benefit of the employer. The mistake cost the employer a significant amount in compensation and legal costs.

No payment during trials

Contrary to some of the misinformation we see, workplace trials should never involve payment of any kind, whether that’s company products, vouchers, or money.

If candidates receive payment during the trial, it may establish an employment relationship, which creates specific legal obligations for the employer.

In the Salad Bowl case, the employer had intended to pay the candidate for the trial and the candidate had expected payment. Because of this, an employment relationship had been created and in not offering the candidate work after the trial ended, the business was found to have unjustifiably dismissed the person (who was an employee).

If you are asking job applicants to perform workplace trials, it’s crucial to clarify that the trial is unpaid and solely for assessment purposes. That way you maintain the integrity of the trial process and avoid potential (expensive) disputes.

Keep it short

The duration of a workplace trial should be fair and proportional to the role being evaluated.

There are no specific legal guidelines, but it's important to strike a balance between allowing enough time to evaluate the candidate’s skills and fit for the role while respecting their time and effort.

Be aware, too, that the longer a trial goes on, the more it could appear like actual employment to the candidate. Less is more: we recommend work trials last a few hours, at the most.

Clearly define the trial terms in writing

Before engaging a candidate on a workplace trial, make sure you write down the terms and conditions of the trial to ensure both parties understand what is expected.

When creating the document, clearly state that the trial is a recruitment tool to ensure the candidate is matched to the role, before you proceed any further with the hiring process.

It should also set out:

  • Details of the trial and what tasks the person will perform - these should be specific to the role.
  • Its duration.
  • That completion of the trial doesn't guarantee a job offer.
  • Participation in the trial is voluntary and the person won’t be paid for their time.

Having everything in writing and signed by both parties minimises the risk that an actual employment relationship is established by default, and prevents misunderstandings that could lead to disputes and legal issues (as happened in the Salad Bowl case).

Our advice

Done correctly, workplace trials allow employers to make informed hiring decisions while giving candidates a fair chance to showcase their skills and suitability for the role.

But like all employment matters, planning and process are key. If you use workplace trials to assess potential employees, approach them fairly and carefully, design the trial, and be transparent about terms and conditions, duration, and their voluntary nature.

If you need longer periods of time to assess a person, we recommend employing them using a valid 90-day trial (if you are a business of less than 20 employees) or probationary period (if you have 20 or more staff).

If you need any advice or assistance in setting up effective, lawful workplace trials, MyHR can help.

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