Managing substandard performance is one of the highest-risk and most contentious employment processes for employers to manage.

Performance issues often develop gradually, involve subjective judgement, complex metrics to measure performance deliverables, allowing reasonable timeframes for improvement and can intersect with other issues such as health, workload imbalances, or organisational change. It is a process designed to address an employee’s substandard performance where it is impacting
business operations in a material way. Either the employee’s performance improves, or they are managed out following the conclusion of the process.

Employer Pro has a comprehensive Employer Toolkit available for managing a ‘Performance Management Process’, including step-by-step guidelines, practical walk-throughs, legal commentary, a draft PIP template, various employer-focused template letters for scheduling formal meetings and managing formal warnings for substandard performance and more to
implement the correct process.

A termination based on substandard performance will only be lawful if it is:

• Substantively justified – There are established reasons based on evidence to prove an employee has not met the requisite standard of performance, including progressive warnings at the end of a Performance Improvement Plan, or PIP.
• Procedurally justified – The employer follows a fair and reasonable process, including a documented performance management framework and progressive warnings issued
  based on clear performance objectives set out in a PIP. An employer must also consult with an employee before implementing a PIP.

Failure on either limb exposes the employer to significant legal risk by way of financial remedies and orders for personal grievance claims, e.g. unjustified dismissal.