Every employer will at some point have to engage in a performance management process with staff who aren’t meeting the expected standards. As with any area of employee management, if performance management isn’t conducted effectively, an employee who does not improve may have successful grounds to challenge a termination. Many employers shy away from performance management because it can appear to be too hard and it’s not uncommon for employees who are subject to performance management to make allegations that they are being bullied. Importantly, reasonable management action, which includes appropriately conducted performance management, is not bullying.
When conducted effectively, performance management doesn’t have to be hard. It may take time and require extensive documentation, but it will also be worth it if your employees perform better, and if they don’t, you will be able to demonstrate you gave them all opportunity to improve. The steps outlined below detail an effective performance management process that may assist employers.
Identify clear performance standards
As an employer, you need to be able to clearly articulate the standards that you expect an employee to be performing at. Your position descriptions should outline an employee’s duties and also the performance indicators, and these should be brought to the attention of your employees. If you have an underperforming employee, you should also clearly articulate expected standards in an individualised document.
Arrange a meeting with the employee to discuss their performance
When meeting with an employee to discuss their performance, you should notify the employee of the purpose of the meeting beforehand to allow them to prepare. Employees should be given an opportunity to bring a support person to the meeting. In the meeting, clearly outline how the employee is underperforming and make sure they have an understanding of what the problem is and how it impacts on your workplace.
Jointly develop an action plan for performance improvement
Where possible, employers should, jointly with the employee, develop a plan that outlines steps to achieve solutions to the performance issues raised. The goals must be realistic and achievable and set out what an employee is require to achieve over a specified time period. The plan should be signed by both the employer and the employee.
Once you have the action plan in place, it’s important to commit to the ongoing process of performance management and monitor whether your employee is meeting their targets. You can include regular review dates in your plan to ensure that you meet with the employee and discuss their progress. You should keep a written record of any performance management meetings that you have.
If an employee’s performance does not improve within the required timeframes, an employer should issue written warnings. The warning should clearly state what is expected of the employee and the consequences if they do not improve, such as formal counselling or termination.
If an employee’s performance does not improve following a written warning, an employer should issue a final written warning, clearly outlining that the employee will be terminated if they do not improve their performance.
If an employee’s performance does not improve subsequent to a final written warning, an employer can proceed to notify the employee that they intend to terminate their employment. There are legal requirements about how a termination should be conducted and employers should seek legal advice prior to proceeding with termination. A procedurally fair and well documented performance management process will greatly reduce an employer’s risk if a subsequent termination is challenged.