Managing Poor Performance in Practice

Performance Management in Practice

This advice is aimed at providing guidance to line managers taking formal steps in relation to the management of an employee’s poor performance. The recommendations are generally applicable and should be followed at whichever stage of your performance management procedure you have reached, although the primary aim is to ensure that any dismissal which occurs as a result of the operation of a performance management process is fair.

Key requirements for a formal process

Performance should be reviewed regular and feedback should be provided.

It is important to address performance concerns before they develop into a formal process. However, if after fair informal process it may be necessary to move to a formal process.

Managers and employees should raise and deal with issues promptly and should not unreasonably delay meetings, decisions or confirmation of those decisions.

Managers and employees should act consistently
Managers should carry out any necessary investigations, to establish the facts of the case
Managers should inform employees of the basis of the problem and give them an opportunity to put their case in response before any decisions are made
Managers should allow employees to be accompanied at any formal meeting
Managers should allow an employee to appeal against any formal decision made.’

Key stages in a performance management process

Establish the facts.
Write to the employee inviting them to a performance review meeting.
Hold the meeting.
Where appropriate (see below), issue a first written caution spelling out the consequences if their performance does not improve within a specified duration. The caution should set out a ‘performance improvement plan’ explaining precisely what the employee has to do to achieve the required standard.
Offer a right of appeal against the caution.
If the employee fails to improve or to sustain the improvement, move to a second or final written caution (offering a right of appeal).
If performance is still unsatisfactory, consider alternatives to dismissal such as redeployment or demotion.

Please note, if redeployment or demotion is not viable, remember to dismiss with notice.

Process is more detail

Establish the facts

When poor performance first comes to your attention, consider whether the employee is aware of the standard that is expected, and check, before you meet with the employee, that the standard has been set at a realistic and achievable level.

If the employee is disabled, consider whether there are any reasonable adjustments that could be made to the physical work environment or the way that their work is organised to enable the employee to meet the target.

Convene a meeting with the employee

A key stage in managing poor performance is for you to meet with the employee (in what we call a performance review meeting) to identify why there is a performance problem.

However, before you convene any formal meeting, at any stage of your procedure, there are a number of safeguards that you are required to observe, namely:

write to the employee inviting them to attend the meeting. HR Team can provide you with a standard letter
give them in advance of the meeting copies of relevant documents and provide sufficient information (and time) to enable the employee to prepare their response;
inform the employee that a possible outcome might be a formal sanction under the relevant stage of the company’s performance capability management procedure (including, where appropriate, dismissal). For example, if you have already given the employee a final written warning, the letter will explain that the next step is possibly dismissal or redeployment

These safeguards, which are derived from the Acas Code, are essential to the fair operation of your procedure. Following them will, if you dismiss the employee, stand the company in good stead if the employee makes a claim of unfair dismissal to an employment tribunal.

Conducting a performance review

The tone of the meeting should be a two-way conversation – remember you are trying to understand the situation and come up with a solution together.

Explain that the meeting is being held under the company’s performance capability management procedure. If the employee is not accompanied, check that they understand they have the right to be. If they decline to be accompanied, make a note of that.

Explain what the performance problem is and the impact it is having.

Ask the employee probing questions to try and understand why the problem exists and what (if any) the trigger was for the fall off in performance. If relevant, why has there not been satisfactory improvement, despite previous action under the procedure?

Take time to consider what the appropriate next step is; might it be a reference to action under another company procedure? Sometimes, you may need to adjourn the meeting to get more information about, for example, what support and training might be appropriate to help the employee meet the standard required.

Outcome of a performance review meeting

There can be many reasons why an employee is underperforming, leading to different outcomes. For example, in the course of the performance review meeting it may become apparent that:

The employee has domestic difficulties. Where it is possible, you may agree a temporary change in, for example, working hours to help the employee overcome the short-term problem. In these cases, you should write to the employee saying that no further action will be taken under the performance management procedure and confirming what you have agreed with the employee, including a review date.

The employee is suffering from a medical condition, in which case you might adjourn the performance management procedure to seek medical advice and consider adapting the process to take account of this. In this case you should contact the HR Team.

The employee has not received training that other employees have had – the oversight can be remedied.

The poor performance is due to lack of effort or carelessness on the employee’s part. In such cases you should consider triggering the disciplinary procedure.

If it is concluded that no further action should be taken, under this procedure or any other, we will write to the employee to confirm this.

In other cases, you might conclude that a formal written caution under the procedure, requiring improvement, is appropriate. Normally, you would issue a first written caution following an initial performance review meeting. However, if the failings are very serious then you may, if your procedure allows it, miss a stage.

You should confirm the conclusion of the meeting in writing (HR Team can support this) and include a performance improvement plan covering:

the performance problem;
the improvement that is required;
a realistic timescale for achieving the improvement, including, where appropriate, staged targets;
when interim progress will be assessed;
how progress will be monitored;
any support that will be offered or changes to the way work will be organised.

The plan will work best where the employee agrees to the targets. However, if you fail to get agreement, you can still issue the plan.

The outcome letter will also specify that the employee has the right of appeal and warn them of the possible ultimate consequences of failing to meet the target, which could include demotion, transfer or dismissal.

Reviewing progress

You should review the employee’s progress as set out in the improvement plan and decide what further action, if any, is necessary. For many individuals, one formal warning is enough to trigger a sustained improvement in performance.

In other cases, the employee may be making a concerted effort to improve, has the potential to perform the job satisfactorily, but has not quite reached the standard required. In these circumstances, it may be reasonable to extend the duration of the period set for the employee to reach the required standard and adjust targets and review dates accordingly.

However, if the employee’s performance is still falling substantially below the standard required and they appear unable to improve to any significant degree, even when given clear targets and appropriate support and training, you may wish to move to the next stage of the procedure, a final written caution. This should clearly tell the employee that they may be dismissed if they do not meet the required standard.

Alternatives to dismissal

If, after a final written warning and the employee has failed to meet the targets after being given a reasonable opportunity to do so, consider transferring the employee to another job that is more suited to the employee’s capabilities.

Note – Employment tribunals require you to consider whether there is alternative employment before you dismiss an employee on poor performance or ‘capability’ grounds. However, you cannot impose redeployment on an employee unless the employee’s contract allows you to. In many cases, therefore, you will need an employee’s agreement to a transfer.

If you do not have the contractual right to transfer or demote the employee and the employee refuses to move job, then it would be advisable to explain to the employee that dismissal is the only other option, to give the employee the opportunity to reconsider their position.

As with any sanction under the performance capability management procedure, if a decision is made to offer redeployment (or to instruct an employee to transfer if your contract allows you to do so), you should give the employee a right of appeal.

Dismissal

If, having issued a final written warning, the circumstances are such that dismissal appears the only realistic option, HR Team will write to the employee inviting them to a further performance review meeting and explaining that the company is contemplating dismissing them because of their performance.

If the decision is made to dismiss, HR Team will write to the employee notifying them of their right to appeal. You should normally dismiss an employee with notice.