Performance at work
Employment law- Poor performance and Performance Improvement Plans
What is poor performance at work?
You may face performance issues by your employer if your work is not up to scratch. This could be as a result of missing sales or other business targets set by your employer, or you could be making mistakes in your work.
You may disagree with the performance allegations being made against you and consider it a sham, or you may consider that you need further training and support. Please see below for further information on this.
What process should an employer follow?
Your employers must demonstrate that they have followed a fair procedure if they wish to establish your lack of capability as a fair reason for terminating your employment. You may otherwise have a claim for unfair dismissal.
Your employer may decide to address any performance issues informally to start with, before going down a formal disciplinary route. Such initial discussions would not usually appear on your disciplinary record.
If a formal route is taken the code of practice from ACAS provides guidance for employers to ensure that performance issues are dealt with fairly at work. Your employer may have their own specific policies, and if this is the case, they should be no less than what is recommended by the ACAS code.
Although the ACAS code is not legally binding, whether or not your employer follows it will be an important factor which Employment Tribunals consider when determining whether a performance dismissal is fair. An employment tribunal can also impose an uplift in damages you are awarded against your employer as a penalty for their not following the Code. Most employers therefore do follow the minimum required process.
The minimum process required under the ACAS code.
1. Your employer should investigate your poor performance
Before taking disciplinary action, your employer must carry out any necessary investigations to establish the facts of the case and substantiate any poor performance allegations made against you. An investigation may include a review of your appraisal records or work monitoring. The investigation may even uncover that the underlying reason for your poor performance is in fact partly the fault of your employer (e.g. you have not received adequate training). In these circumstances, it may be that an action to terminate your employment could amount to unfair dismissal. If there is an investigatory meeting, this should not in itself result in any disciplinary action.
2. You should be informed of what the problem is and notified of the disciplinary meeting
If it is decided that there is a disciplinary case to answer, you should be notified of this in writing, which should set out the nature of the poor performance and its possible consequences (such as being provided with a warning). You should also be provided with any appropriate evidence together with details of the time and venue of the disciplinary meeting. You should also be given the right to be accompanied at the meeting by a work colleague, a trade union representitive or an official employed by a trade union. The right to be accompanied should be provided where the disciplinary meeting could result in a formal warning being issued or some other disciplinary action being taken.
3. You should be given warnings about poor performance and an opportunity to improve
After a disciplinary meeting, your employer must consider whether disciplinary action is justified. If your performance is deemed to be unsatisfactory, it is usual that you be provided with a first written warning. The warning should set out the nature of the poor performance together with the improvement required and the timescale for such improvement. Your work should be properly reviewed and monitored during this time. You may be placed on a performance improvement plan– see below.
What is a reasonable timescale may depend upon the length of an employee’s past service, the extent of the underperformance and the effect which the underperformance has on the business (i.e. their relationship with clients). It may be that your employer will link the timescale to a natural part of a business cycle, for example, an upcoming sales target or pending completion of a particular project.
You should also be informed of the consequences of further disciplinary action – which could very well be a final written warning if you have been provided with a first written warning, or a dismissal if you are at the final written warning stage. Sometimes your employer will be within their rights to issue you with a final written warning straight away if your unsatisfactory performance is sufficiently serious (for example, where it has had a serious impact on your employers business).
4. You should be given the right to appeal
If you are not happy with the decision taken by your employer at any stage, you have the right to appeal and your employer should notify you of this in writing at the same time as notification of any disciplinary action. Your employer should also notfify you of the time period for appealing (usually this is up to 5 working days). The ACAS code advises that your appeal should be dealt with as impartially as possible and ideally should be heard by a different manager than the one who dealt with the original disciplinary procedure and decision. As with the initial disciplinary meeting, you have a statutory right to be accompanied at an appeal hearing, and which should be heard without undue delay.
What is a performance improvement plan?
A Performance Improvement Plan (or ‘PIP’ as it is commonly known) is a process frequently used by employers where it is being alleged an employee has not carried out work to satisfactory standard. It is usually set out in writing for the employee to acknowledge and accept, and is often also coupled with a formal disciplinary process (although this isn’t always the case, as some employers will go straight to PIP process).
The PIP should:
- clearly and objectively set out where you are failing;
- set out the improvement expected of you using measurable objectives;
- state whether any support or training will be provided;
- provide for the timescales and frequency of reviews; and
- make clear what sanctions there will be if you fail to improve.
Should you sign a PIP that you do not agree with?
Not all PIP’s require your signature to signal your agreement. If there is a requirement for you to sign, and you do not agree with the performance allegations or process, you should not sign it. This is because you do not want to be seen to be consenting with the PIP which could later make it very difficult to challenge. You would also need to be taking further steps to make it clear why you are not signing the PIP and why you do not agree with it. In many cases, if you cannot resolve matters informally, the most appropriate course would be to lodge a grievance. You should, if possible, take early legal advice before you do anything else.
If you are not asked to sign the PIP (or there is no place to sign), you would still need to make separate representations as to why you don’t agree with it. If you do nothing, you are likely to be seen to have consented to the process by reason of your silence and lack of objection.
What are the clues to spot for an unfair performance improvement plan?
- If you have a long period of service, the introduction of a PIP could be seen to be rather surprising. This is especially where there have been no major prior issues with your performance. In fact, there may even be a history of good performance positively reinforced by your employer- for example, through good appraisals or bonuses (and this is especially important the closer the last good appraisal to the performance allegations).
- Your relationship with your line manager may give a clue as to the real reason for the PIP. The importance of workplace relationships should not be underestimated; it is frequently the case that contention in the workplace is down to a personality clash. Many individuals who are put on a PIP can cite an underlying motive which has nothing to do with the standard of their work, and more a breakdown of personalities.
- The terms of the PIP itself may provide a clue. A PIP that puts forward unrealistic targets and/or timeframes for improvement lends credence to the possibility that you are being set up to fail.
- Where you are part of a team of people with similar roles who have all attained similar standards of work, and yet you have been selectively chosen for a PIP when your peers have not.
- Where there are redundancies being made, and you find yourself surprisingly on a PIP based on unfounded allegations. A reason for this is often that your employer wishes to avoid making what could otherwise be a large redundancy. It may be cheaper to therefore dismiss you or hope that you will leave on your own accord by “performance managing you out”.
Is there an alternative to your having to go through a performance improvement process?
If the situation cannot be resolved informally with HR or your line manager, it will always be a good idea to lodge a formal grievance setting out why you are not happy with the process and what you do not agree with. The grievance lays down a marker to your employer in an open and formal manner that there is an issue, and something they will need to investigate. The PIP process is often put on hold once a grievance is investigated, although this is not always the case.
Alternatively (or in addition), it may be possible to come to an agreement with your employer to leave employment on mutual terms under a settlement agreement. This is especially where you consider that whatever the outcome of the performance process, the employment relationship has broken down. From an employee’s perspective, the indignity of being put on a PIP in itself will often be enough to result in a breakdown of trust and confidence with their employer, especially where the PIP perceived to be without foundation. Indeed, in extreme cases where being placed on a PIP makes the continuing relationship untenable, and it can amount to constructive dismissal.
This is a highly tactical situation and not one that should be adopted if possible without you being aware of all your rights, including what type of settlement is possible. It is for this reason that it is usually far better to have legal representation in negotiating a severance so that you do not say or do the wrong thing which could put at risk a negotiated settlement. We have successfully negotiated thousands of settlements where employees have been put on a PIP.
Negotiations should always be conducted on a “without prejudice basis“, which essentially means “off the record”. If terms can be agreed, we always ensure that part of the settlement will include an agreed job reference and appropriate non-derogatory clauses, so you are not bad-mouthed in the future. The full terms of the settlement agreement will need to be carefully negotiated.
What if your employer approaches you with a financial settlement, know as a “protected conversation”?
You may be approached out of the blue by your employer, and be offered a financial payment to leave. This is known as a “protected conversation”, which means you cannot rely on such a discussion in any future tribunal proceedings. Such an approach is quite common where there are performance issues, as it saves both parties going down a lengthy process when a continuing relationship is going to be unlikely in any event.
Under Acas guidelines, you are entitled to a period of 10 days to consider any offer, and you don’t have to accept it. An employer cannot rely on the same degree of protection where there has been undue influence against an employee to accept an offer, or against a background of discrimination, whistleblowing and harassment. You should if possible take immediate legal advice if you have been approached by your employer, not least, because you are unlikely to know whether what is being offered represents a decent proposal.
Remember never to sign, or positively acknowledge, a performance improvement plan that you do not agree with. At Landau Law, we have successfully negotiated thousands of settlements where employees have unfairly faced PIP’s.