Each time an employee leaves your business, it costs you money. You have to recruit a replacement, train the new hire, and maybe even pay severance (if the previous employee was fired).
One way to reduce turnover — and generally find the best employees for your company — is to offer a paid trial period to all new hires. At the end of the trial, you determine whether you want to extend a permanent offer, and the employee decides whether your business suits their needs for long-term employment.
Although trial periods (typically 90 days) offer many benefits to employers, some job candidates may be reluctant to take what is essentially a temporary position, especially if it involves relocating their family. It is important that whatever policy you adopt treats all
applicants equally. You should also clearly explain the probation period when you present the job offer.
Here are three situations in which trial periods can be a smart option for small-business owners:
When new hires do not have an employment record or professional references, it can be especially challenging to feel confident that they are going to be a productive member of your team. By using a trial period for those entering the workforce for the first time, you can get a sense of their work habits and skills before officially offering them a permanent position.
Certain jobs are harder to fill with the right person and thus experience higher turnover. For example, if you have recently had several new salespeople quit (or get fired), then it may be beneficial to use a trial period for the position. This will help you determine whether the next candidate is a good fit for the company before making a permanent commitment. However, if you’ve had a revolving door lately, you should also investigate whether there are internal reasons why employees are leaving.
You really like a job candidate and think they would be a great fit for your company, but they’re missing a few key skills. Maybe they don’t have management experience or haven’t worked with a key technology that your company uses. By hiring the employee for a trial period, you can ensure that your intuition was correct and they are competent — perhaps even great — at the job.