The probationary period is one of the key stages in the employment process, yet its legal status is not fully defined under the Labour Law [¹] (hereinafter referred to as the “Law”), which leaves room for various interpretations and legal uncertainty.

Although the Law does not provide a clear definition of probationary work, it stipulates that a probation period may be agreed upon for performing one or more related tasks, and must not exceed six months. In essence, the probationary period functions as a suspensive condition—if the employee demonstrates satisfactory performance, an employment relationship is established. Conversely, the employer retains the right to terminate the contract under a resolutory condition if the employee fails to meet expectations.

The Law allows the employer to terminate the employment contract during the probationary period, with a minimum notice period of five working days, provided that the Employer states the reasons for the termination.

Although this provision may suggest that the employment contract can be terminated during probation without much formality – given that probation serves the purpose of a subjective assessment by the employer of the employee’s suitability – in practice, questions have arisen regarding to what extent certain rules related to employment termination still need to be followed.

Is it necessary to warn the employee about the existence of grounds for termination?

Decisions from basic and appellate courts suggest that before terminating the contract during the probationary period, the employee should be warned about the reasons for termination and given time to improve performance. These court opinions are based on ILO Convention No. 158 concerning the Termination of Employment at the Initiative of the Employer, which, in Article 7, states that an employment relationship shall not be terminated for reasons related to the worker’s conduct or performance before the worker is given an opportunity to defend against the allegations, unless it cannot be reasonably expected of the employer to provide such an opportunity.

Recommendation No. 166 of the same Convention provides that an employee should not be dismissed for unsatisfactory performance unless the employer has first provided instructions and a written warning, and if, after an appropriate time for improvement, the employee continues to perform inadequately, the employment may be terminated.

However, this position of lower-instance courts has been challenged by the Supreme Court of Cassation, which holds that the termination of a contract during the probationary period is a specific type of employment termination expressly regulated by law, and therefore, it is not necessary to follow the usual procedure—including giving a warning or an opportunity to improve performance.

Is a specific reason for termination required, and how is it determined?

Most employers, when terminating an employment contract before the end of the probation period, still state the reasons for termination—usually that the employee has not demonstrated adequate work or professional capabilities (which is, in fact, the statutory reason for termination at the end of probation).

Employers choose to include this explanation because the law requires termination to be explained, and because it genuinely reflects the factual basis for ending the employment before the probation period ends.

According to decisions of the Supreme Court of Cassation from 2014 and 2015, there is no obligation to state reasons for termination during probation, as this is considered a distinct type of employment termination, not subject to special procedural requirements.

While this position most accurately reflects the purpose of the probationary period and the applicable legal norm—which only requires an explanation but not specific reasons—recent court decisions show a trend toward tightening this interpretation and reveal inconsistencies in practice.

For example, some appellate and first-instance courts have held that if the contract is terminated before the end of probation, the reasons must be clearly and specifically stated, with well-defined criteria and a clear procedure for evaluating the employee’s performance and professional competencies. These criteria should be used to assess probationary success and applied at the time of termination.

It remains unclear on what legal grounds the courts have based such a rigid position, as it essentially erases the special nature of termination during probation, almost equating it to regular termination due to poor performance or lack of necessary skills and qualifications.

The Supreme Court of Cassation has nevertheless maintained a more moderate stance. Compared to its earlier, more liberal interpretation, its more recent decisions suggest that reasons should still be explained, but without a deep procedural or substantive analysis of criteria, evaluations, or other legal standards.

In conclusion, an employment contract can be terminated during the probationary period without a warning, but it is important to recognize the diverging interpretations regarding the determination and explanation of the reasons for termination.

[¹] “Official Gazette of the Republic of Serbia”, Nos. 24/2005, 61/2005, 54/2009, 32/2013, 75/2014, 13/2017 – decision of the Constitutional Court, 113/2017, and 95/2018 – authentic interpretation.