Managing Poor Performance: A Guide

This guide on dealing with staff underperformance is for employers and managers. It explains the advantages of taking a best practice approach to managing underperformance, and how to identify, address and minimise underperformance.

 

Understanding underperformance

 

Every workplace can enjoy the benefits of taking a best practice approach to managing underperformance. These may include:

 

• a more harmonious, high performing workplace
• maximising an employee’s individual performance
• building a culture of continuous skill development and improvement
• higher levels of employee engagement
• avoidance of legal disputes, such as unfair dismissal or bullying claims.

 

Underperformance or poor performance can include:

 

• not performing duties, or not performing them to the required standard
• displaying negative or disruptive behaviour in the workplace
• failing to comply with workplace policies, rules or procedures.

 

Underperformance doesn’t just affect the output of an individual employee – it can also impact co- workers, customers and business productivity.

 

There are many reasons why an employee might perform poorly. Some common reasons include:

 

• the employee doesn’t know what’s expected of them because goals and standards are unclear
• the employee may not have the knowledge or skills to do the job
• the employee is unsure if they are meeting requirements
• low personal motivation or confidence
• personal issues such as family stress, physical and/or mental health problems, or problems
  with drugs or alcohol
• low morale in the workplace and/or a poor work environment
• interpersonal differences or cultural misunderstandings

 

Capabilty or misconduct?

 

Underperformance isn’t the same as misconduct. If the issue is determined to be a result of the employee choosing or not wanting to perform, such as insubordination, this would be a misconduct matter rather than capability issue, that should be dealt with using a disciplinary procedure.

 

How to manage poor performance and deal with underperforming staff

 

Best practice doesn’t look the same for all employers. The way to achieve best practice will vary because of things such as the number of employees, industry and the business environment.

Below are suggestions and initiatives that can help you move your business towards best practice.

 

1. Implement a performance system

 

A performance system provides employees and managers with a framework for goal setting, constructive feedback, continuous skill development and regular discussions about performance. This helps reduce the chance of underperformance occurring.

A performance system doesn’t have to be complicated or time-consuming. To implement best practice in your workplace you could consider:

 

• expectations – discuss your performance system during induction, training and in staff communications – this will help make performance a regular part of workplace conversations
• template agreements – create a simple performance agreement template for your workplace
  discussions – meet with employees to set clear performance expectations, discuss and record their individual performance goals and training needs
• feedback – monitor employees’ performance and provide regular, specific feedback, in a timely manner, about things they do well and things they can improve on
• training – support employee’s skills and performance through training, coaching and mentoring
• review – conduct performance reviews every few months. Track employee performance against the agreed goals and set new goals
  self-review – ask employees to complete a short self-review ahead of the performance review – this helps employees feel more involved with
• and committed to the process
• reward – recognise and reward employees who do a good job. This doesn’t have to be a financial reward. Many employees appreciate a simple acknowledgement of their effort or achievements.

 

2. Address underperformance

 

Addressing underperformance can be challenging for both managers and employees. Failure to address underperformance appropriately, sensitively and promptly, can have a significant impact on your workplace culture and productivity. The issue is unlikely to go away on its own, and other employees may lose motivation if they have to carry the burden of poor performing colleagues.

Address underperformance issues straight away. It will make it easier to resolve issues and avoid more serious problems. It will also assist if you decide later to dismiss an employee for underperformance.

A 5-step best practice approach would include:

 

Step 1 — Identify the problem

Write down:

 

• examples of the behaviour or action that is causing an issue
• when it’s occurring
• why it’s an issue
• specify how the behaviour or action needs to change or improve.

 

Get any documents that demonstrate the problem, such as business statistics, examples of the employee’s work or customer feedback. Make copies to give to the employee.

 

Step 2 — Assess and analyse

If you identify a problem, consider:

 

• how serious is the problem
• how long the problem has existed
• the gap between what’s expected and what’s being delivered.

 

Once you have assessed the problem, organise a meeting with your employee to discuss it.

Let the employee know the reason for the meeting in advance so they can adequately prepare. If you will be going through specific documents, provide copies to the employee before the meeting.

Explain to the employee they have the right to be accompanied by a relevant person, such as a co-worker or union representative. Their role is to support the employee during the meeting – not to speak or advocate for them.

 

Step 3 — Meet with the employee

It’s important the meeting takes place in a private, comfortable, non-threatening environment, away from distractions and interruptions. The meeting should not be overheard by others.

During the meeting you should:

 

• clearly describe the problem and refer to specific examples
• explain the impact on the business, the employee’s work or co-workers
• explain the outcomes you want to achieve from the meeting
• give the employee an opportunity to respond and give you their view of the situation
• listen and ask questions to understand their response to the problem and why it has occurred
• if possible, refer to recent positive things the employee has done, to show them you also recognise and appreciate their strengths
• use a relaxed and encouraging tone and show confidence in the employee’s ability to improve.

 

Step 4 — Agree on a solution

After discussing the problem, you and your employee should work together to find a solution. Employees are more likely to improve their performance if they feel they have contributed to this process.

When developing a solution, you should:

 

• make sure the employee understands the change you require
• explore ideas by asking open questions. For example, ask the employee ‘what can we do to improve this in future?’
• suggest ways to fix the problem, and invite the employee to make suggestions as well
• offer appropriate support and assistance, such as training, mentoring, or adjustments to the employee’s duties
• reinforce the value of the role the employee performs.

 

Consider recording the agreed actions in a performance improvement plan. This is a document that sets out what the employee needs to do to improve their performance. It should:

 

• clearly identify the performance that needs to improve or the behaviour that needs to change
• outline how this will be done, and list any support that will be provided to help the employee improve
• explain each party’s responsibilities
• give the employee a reasonable time to improve their performance
• set a date for a follow up meeting to review progress and discuss the employee’s performance against the agreed plan
• in cases of serious or ongoing underperformance, specify clearly and preferably in writing the possible consequences if the employee’s performance does not improve.

 

Both you and the employee should keep a copy of any performance improvement plan.

 

Step 5 — Monitor and review

Once you have a solution in place, make sure you:

 

• follow through with any training or other support you offered the employee
• regularly check-in with the employee to discuss how they are progressing
• continue giving feedback and encouragement
• have a follow up meeting at the agreed time to review their progress.

 

It often takes more than one conversation to resolve an issue. A follow up meeting is a good chance to acknowledge the employee’s progress and focus on the improvements that are still required. Remember, give the employee a reasonable period to improve. What is reasonable will depend on the employee’s role and the duties they perform.

If you have a performance improvement plan in place, update the plan at the follow-up meeting to specify:

 

• whether the current performance is satisfactory or not
• what has improved
• what still needs to be improved
• what support is being provided
• when the performance will be reviewed again.

 

Both you and the employee should keep a copy of any updated performance improvement plan.

Once the performance has improved to a satisfactory level, acknowledge that the issue has been resolved and discuss how the improvements will be maintained.

If an employee’s performance doesn’t improve after a reasonable period, you need to consider your options.
In some cases, it may be appropriate to continue performance management or issue a formal written warning. If the employee is still underperforming after a reasonable period, it may be appropriate to dismiss them.

 

Train managers and employees

 

Dealing with underperformance can be challenging for both employees and employers. Managers need clear procedures and organisational support. They also need the courage and willingness to manage the issue.

Best practice employers give their managers and employees training and information about setting performance goals, giving feedback and managing underperformance. This helps managers to better identify and address issues of underperformance.

Information and resources you could provide to help your managers include:

 

• training on handling underperformance. It’s a good idea to include role-play elements in this training to help managers practice their approach
• policies about performance management
• templates for performance agreements and performance improvement plans
• reminders before key dates, for example automatic email messages or calendar entries to prompt managers to conduct performance reviews or follow up meetings.
• contact details for people in the business who can give guidance on performance management

 

Dismissing an employee for underperformance

 

Ending an employee’s employment is a serious step. You must have a fair and lawful reason for the dismissal relating to the employee’s capability, and follow a fair and lawful process.

A failure to follow the proper process before dismissing an employee may result in a successful unfair dismissal claim against you.

To avoid unfair dismissal complaints, employers should follow their organisation’s capability process, or as a minimum the Acas Code of Practice guidelines, which explain how to dismiss for poor performance, when disciplining or dismissing employees. If an employment tribunal finds that you have dismissed an employee unfairly, they may increase any award or penalty by up to 25%.

 

Dealing with underperformance: checklist for managers

 

A best practice workplace involves more than just understanding and complying with the law. This checklist will help you work at best practice when managing and preventing underperformance within your business:

 

• performance system – implement a performance system, it doesn’t have to be a complex one! This will give your workplace a framework for
• setting expectations, developing skills, giving feedback and regularly reviewing performance
• reward – recognise and reward employees when they’re performing well
• identify and promptly address – identify and assess underperformance problems when they occur. Address underperformance issues straight away
• process – follow any performance management process set out in your award or enterprise agreement, the employee’s contract or relevant workplace policies about performance management
• meeting – organise a meeting with the employee to discuss a problem when there is one. Conduct the meeting in a private, non-threatening, comfortable and quiet location
• prepare – prepare for any meetings. Provide relevant documents to the employee, give the employee time to prepare for the meeting and invite or allow them to bring a support person
• be specific – explain your specific concerns to the employee. Provide evidence and clearly outline the improvement required. Discuss the consequences of continued poor performance
• questions – ask questions, give the employee an opportunity to respond
• listen – before considering what actions you might take next
• solution – ensure the employee understands what’s expected of them and work together to find a solution to improve performance
• document – record the solution in a performance improvement plan with milestones and time frames for further review. Document all discussions, and keep records
• follow-up – schedule a follow-up meeting to review the employee’s performance against the agreed plan
• monitor and support – monitor the employee’s performance and continue to provide feedback. Provide training and support to help the employee improve. Where an employee’s performance is suffering due to the employee’s personal circumstances, discuss with the employee any external support, such as referral to professional services or counselling
• dismissal – if performance doesn’t improve and you are thinking about dismissing the employee, ensure the process is fair and the employee is given an opportunity to respond to the reasons you consider justify dismissal before dismissing the employee.

 

Need Assistance?

 

It’s best practice for employers to have regular discussions with employees about performance, setting clear goals and providing feedback and support to help employees perform at their best. If underperformance occurs, you should take steps to manage it appropriately, sensitively and promptly.

DavidsonMorris are experienced employment law specialists offering guidance and support to employers in relation to performance at work, managing poor performance and capability-related dismissals.

If you have a question or need help with performance management or lawful dismissal, contact us.

 

Managing poor performance FAQs

 

What is underperformance at work?

Underperformance is when someone is failing to work to the expected and required standard for their role.

 

How do you deal with an underperforming staff?

Managers should proactively monitor performance on an ongoing basis to identify underperformance issues, then raise any concerns informally with the individual, followed by a formal performance management process if there is no sufficient improvement.

 

What are the five 5 steps to managing the underperformance of staff?

The five key steps in performance management are identifying the problem; assess and analyse the issues; meet with the employee to discuss the concerns; agree on a solution; monitor and review progress.

 

How do you tell a staff member they are underperforming?

Managers should be open with underperforming employees about expectations and concerns, presenting the facts and giving examples to evidence the issues. Try to understand if there are any issues to be taken into account, and discuss how improvements can be made by agreeing an action plan with clear goals.

 

What should I do if an employee refuses to engage with the performance improvement process?

If an employee refuses to engage, it’s important to document their lack of cooperation. Continue to offer support and ensure they understand the consequences of non-engagement. In some cases, it may be necessary to escalate the issue to formal disciplinary procedures, but this should be a last resort after all other avenues have been explored.

 

How long should a Performance Improvement Plan (PIP) last?

A typical PIP might last between 30 to 90 days, depending on the severity of the performance issues and the role in question. The duration should be sufficient to allow the employee a fair chance to improve while maintaining the organisation’s operational needs.

 

Can I dismiss an employee for poor performance without a PIP?

Dismissing an employee without first giving them the opportunity to improve through a PIP can be risky and might be deemed unfair by an employment tribunal. It’s crucial to follow a fair process, which typically includes offering support and a clear pathway for improvement.

 

What is the difference between poor performance and misconduct?

Poor performance usually relates to an employee’s inability to meet the required job standards, whereas misconduct involves inappropriate behaviour or actions that breach company policy. Both require different approaches; poor performance is typically managed through support and improvement plans, while misconduct may lead to disciplinary action.

 

Is it necessary to involve HR when managing poor performance?

While line managers often handle performance issues directly, involving HR can ensure that the process is fair, consistent, and compliant with employment law. HR can provide guidance, help document the process, and ensure that any actions taken are legally sound.

 

What documentation should I keep when managing poor performance?

It’s essential to keep detailed records of all conversations, meetings, and actions taken when managing poor performance. This includes notes from performance reviews, copies of PIPs, emails, and any other correspondence. Proper documentation helps protect the organisation if the situation escalates or leads to legal action.

 

How can I prevent poor performance from occurring in the first place?

Preventing poor performance starts with clear job descriptions, regular feedback, and setting realistic expectations. Continuous training, development opportunities, and fostering a positive work environment also play key roles in maintaining high performance standards.

 

Can I extend a PIP if the employee is showing some improvement?

If the employee is showing improvement but hasn’t yet fully met the performance standards, extending the PIP can be a reasonable step. The extension should be agreed upon mutually and should be for a specific period, with clear goals for the employee to achieve.

 

What should I do if poor performance is due to personal issues?

If personal issues are affecting an employee’s performance, it’s important to approach the situation with sensitivity. Offering support, such as flexible working hours or access to an employee assistance programme, can help. However, it’s still necessary to address the performance issues professionally, balancing empathy with the organisation’s needs.

 

Glossary

 

 

Term	Definition
ACAS	The Advisory, Conciliation and Arbitration Service is a UK organisation that provides free and impartial advice to employers and employees on workplace relations.
Performance Improvement Plan (PIP)	A structured plan designed to help an employee improve their performance by setting clear, achievable goals and providing the necessary support.
Employment Rights Act 1996	A key piece of UK legislation that governs the rights of employees, including provisions related to unfair dismissal, redundancy, and other employment issues.
Misconduct	Inappropriate behaviour or actions by an employee that violate company policies or standards, which may lead to disciplinary action.
Poor Performance	The inability of an employee to meet the expected standards or requirements of their job, often addressed through a PIP or other supportive measures.
Disciplinary Procedures	The formal processes an employer must follow when dealing with issues such as misconduct, including investigations, warnings, and potential dismissal.
SMART Goals	A framework for setting clear and effective goals, ensuring they are Specific, Measurable, Achievable, Relevant, and Time-bound.
Tribunal	A legal body that resolves disputes between employers and employees, including cases of unfair dismissal and discrimination.
HR (Human Resources)	The department within an organisation responsible for managing employee relations, recruitment, training, and ensuring compliance with employment law.
Redeployment	The process of moving an employee to a different role within the organisation, often considered as an alternative to dismissal when performance issues arise.
Employee Assistance Programme (EAP)	A workplace programme designed to support employees with personal or work-related issues that may affect their performance or well-being.
Documentation	The process of keeping detailed records of all actions, communications, and meetings related to managing employee performance, crucial for legal compliance.
Feedback	Constructive information provided to an employee about their performance, aimed at encouraging improvement and development.