Probation periods are a standard part of hiring in Australia. They give employers and employees time to assess whether the role is the right fit. But one of the most persistent misconceptions in Australian employment law is that employees on probation have reduced — or no — leave entitlements.
This is simply not the case. Under the National Employment Standards (NES), leave entitlements accrue from the very first day of employment, regardless of whether the employee is serving a probationary period.
This guide explains exactly what employers need to know about leave during probation, the common mistakes to avoid, and how to manage leave requests in those crucial early months.
Disclaimer: This article is for informational purposes only and does not constitute legal advice. Consult an employment lawyer for guidance specific to your organisation.
What Is a Probation Period?
A probation period is a defined period at the start of employment — typically three to six months — during which an employer can assess a new employee’s suitability for the role. During probation, employers generally have greater flexibility to terminate employment, subject to minimum notice requirements.
However, it is critical to understand that a probation period is not a separate legal status under the Fair Work Act 2009. It is a contractual arrangement between the employer and employee. The NES applies in full from the first day of employment, regardless of any probationary clause in the employment contract.
The Minimum Employment Period
The Fair Work Act establishes a “minimum employment period” — six months for most employers, or twelve months for small businesses with fewer than 15 employees — before an employee can access unfair dismissal protections. This is separate from a probation period and does not affect leave entitlements.
Many employers confuse the minimum employment period with probation. While the minimum employment period affects dismissal rights, it has no bearing whatsoever on leave accrual or entitlements.
Leave Entitlements That Apply From Day One
Under the NES, the following leave types begin accruing or are available from the employee’s first day of work:
Annual Leave
All full-time and part-time employees accrue 4 weeks (152 hours for full-time) of paid annual leave per year, calculated on a pro-rata basis. Accrual begins on the first day of employment and accumulates progressively throughout the year.
For example, an employee who has been working for 4 weeks has already accrued approximately 2.92 hours of annual leave (based on a 38-hour week). This leave is available to be taken, subject to employer approval.
Personal/Carer’s Leave
Full-time and part-time employees are entitled to 10 days of paid personal/carer’s leave per year, which also accrues progressively from day one. This covers both sick leave and carer’s leave (time off to care for an immediate family member or household member who is ill or injured).
Compassionate Leave
All employees, including casuals, are entitled to 2 days of compassionate leave per occasion. This leave is available immediately — there is no qualifying period. Compassionate leave applies when a member of the employee’s immediate family or household passes away, or contracts or develops a life-threatening illness or injury.
Community Service Leave
Employees are entitled to unpaid leave for voluntary emergency management activities (such as volunteering with the State Emergency Service or Country Fire Authority) and jury service from day one. Jury service leave includes a make-up payment for up to 10 days.
Family and Domestic Violence Leave
As of 1 February 2023, all employees (including casuals) are entitled to 10 days of paid family and domestic violence leave per year. This entitlement is available in full from the first day of employment — it does not accrue progressively.
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Common Misconceptions About Probation and Leave
Misconception 1: “Employees Can’t Take Leave During Probation”
There is no legal basis for refusing leave solely because an employee is on probation. If an employee has accrued annual leave and makes a request, the employer must consider it genuinely. Refusing leave must be based on reasonable business grounds, not simply the fact that the employee is new.
For personal/carer’s leave, an employer cannot refuse a legitimate request at any time, including during probation, provided the employee meets the notice and evidence requirements.
Misconception 2: “Leave Doesn’t Accrue Until Probation Ends”
This is incorrect. The Fair Work Act makes no distinction between probationary and confirmed employees when it comes to leave accrual. Leave begins accruing from day one, and any employment contract clause that purports to delay accrual is likely unenforceable.
Misconception 3: “We Don’t Have to Pay Out Leave if We Terminate During Probation”
When employment ends — for any reason, at any time — the employer must pay out all accrued but untaken annual leave. This applies even if the employee is terminated during their first week. The payment must be made at the employee’s ordinary rate of pay.
Long service leave and other state-based entitlements may have qualifying periods, but annual leave and personal leave accrual are not affected by probation.
Misconception 4: “Probation Clauses Override the NES”
No contractual term can reduce or override the minimum entitlements in the NES. If your employment contract states that “leave does not accrue during probation,” that clause is void to the extent that it contravenes the Fair Work Act. The employee’s entitlements remain intact regardless of what the contract says.
Can Employers Restrict Leave During Probation?
While employers cannot deny that leave accrues during probation, they do have some legitimate tools for managing leave requests:
Reasonable Business Grounds for Refusing Annual Leave
Under the Fair Work Act, an employer can refuse an annual leave request if there are reasonable business grounds. These might include:
- The employee’s absence would cause significant operational disruption
- The request coincides with a peak business period
- Insufficient notice was provided
- Other team members are already on leave during the same period
These grounds apply to all employees, not just those on probation. However, during probation, an employer may reasonably prioritise having the new employee present for training and onboarding purposes.
Setting Expectations in the Employment Contract
Employers can include a clause in the employment contract that sets expectations around leave during probation — for example, requesting that employees try to avoid taking extended annual leave during the first three months. However, this must be framed as a request or expectation, not a prohibition. It cannot override the employee’s legal right to accrue and request leave.
Notice and Evidence Requirements
Employers can require employees to provide reasonable notice for annual leave requests and evidence (such as a medical certificate) for personal/carer’s leave. These requirements apply equally during probation.
Practical Guidance for Employers
1. Review Your Employment Contracts
Audit your standard employment contracts and offer letters. Remove any language that suggests leave does not accrue during probation, or that employees cannot take leave during this period. Replace it with clear, compliant language that aligns with the NES.
2. Train Your Managers
Frontline managers are often the first point of contact for leave requests. Ensure they understand that probationary employees have the same leave entitlements as confirmed employees and that refusing leave solely because someone is “still on probation” is not lawful.
3. Track Leave From Day One
Your leave management system should begin tracking accrual from the employee’s start date, not from the end of their probation period. If you are using manual spreadsheets, ensure the formulae account for accrual from day one.
4. Handle Sick Leave Sensitively
High absenteeism during probation may be a legitimate performance concern. However, you cannot penalise an employee for taking personal/carer’s leave they are legally entitled to. If you have concerns about patterns of absence, address them through performance management processes rather than by denying leave.
5. Document Everything
Keep clear records of all leave requests, approvals, and refusals during probation. If you need to terminate an employee during probation, having thorough documentation helps demonstrate that any decision was based on genuine performance or business reasons, not on the employee’s exercise of their leave entitlements.
6. Communicate Your Leave Policy During Onboarding
Include a clear explanation of leave entitlements in your onboarding pack. Let new employees know how leave works, how to request it, and what your expectations are. Transparency builds trust and reduces the likelihood of disputes.
What Happens to Leave if Employment Ends During Probation?
If an employee’s employment ends during or at the conclusion of probation — whether through termination or resignation — the employer must:
- Pay out all accrued but untaken annual leave at the employee’s ordinary rate of pay
- Not pay out untaken personal/carer’s leave — this leave is not payable on termination under the NES
- Provide the minimum notice period required under the Fair Work Act or the employment contract, whichever is greater
For employees with less than one year of service, the minimum notice period under the NES is one week. Some contracts specify a shorter notice period during probation (e.g., one day), but they cannot provide for less than the NES minimum.
Key Takeaways
- Leave accrues from day one — probation does not delay or reduce NES entitlements
- Annual leave, personal/carer’s leave, compassionate leave, and family and domestic violence leave all apply during probation
- Employment contracts cannot override the NES — any clause that purports to do so is void
- Employers can refuse annual leave on reasonable business grounds, but not simply because the employee is on probation
- All accrued annual leave must be paid out on termination, even if it occurs during probation
- Review your contracts, train your managers, and track leave accurately from the start date
Getting leave entitlements right during probation is not just about compliance — it sets the tone for the employment relationship. Employees who feel their rights are respected from the outset are more likely to be engaged, productive, and loyal.
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