This guide sets out below the key issues and aspects of procedure when dealing with performance issues at work.
Ensure there is a fair procedure for performance issues in place to which all staff have access and on which managers have received training.
This may be part of the disciplinary procedure or could take the form of a separate document.
It may of course be possible to deal with poorly performing staff on an informal basis but if you choose a more formal/disciplinary route, check that any policies accord with the ACAS code of practice.
Ensure that, before recruiting new employees, you have a detailed job description/person specification so that everyone knows what performance is expected. Similarly, it is important to make any job offer conditional on receipt of satisfactory references, and you should take these up. They may throw up issues early and help avoid taking on someone with a poor performance history.
Include probationary periods with shorter notice periods in all contracts of employment and use them to assess a new employee and deal with any problems that arise at an early stage. It can be useful to include an express provision in the employment contract stating that the probation is not over until the employee is notified in writing and reserving the right to extend the probationary period where problems arise or if you think the individual is not suitable for the role. Any extension should be done, and communicated to the employee, before the original period expires.
Employees must know what is expected of them. Ensure you have an effective appraisal system in place as a means of managing performance. Managers shouldn’t wait until appraisals to bring up performance issues; encourage them to raise these issues as and when they arise. A paper trail should be kept recording any communications concerning employment issues on the employee’s personnel file.
If you’re going down the disciplinary route, ensure you are familiar with the ACAS code of practice. Remember that tribunals can make an uplift or reduction of up to 25% to many compensatory awards for unreasonable failure to follow the code.
The code sets out that whenever a disciplinary process is being followed issues should be dealt with fairly, the key elements of which are:
Raise and deal with issues promptly without unreasonable delay
Carry out necessary investigations to establish the facts of the case
Inform employees of the basis of the problem and give them an opportunity to put their case in response before any decisions are made
Allow employees to be accompanied to any formal disciplinary or grievance meeting
Allow an employee to appeal against any formal decision made
Identify if the disciplinary issue is misconduct or incapability. If an employee is failing at their tasks this is ‘capability’. If there is wilful default, it is a disciplinary and ‘conduct’ matter.
To dismiss fairly for poor performance, ensure that:
they have been given an opportunity to improve
they have not improved and is not likely to do so, and
it is not reasonable to offer them an alternative job, demotion or another alternative sanction
A fair dismissal for incompetence requires a genuine belief from you that the employee is incapable of doing the job to a satisfactory standard and that the belief is reasonable. This will require gathering as much objective evidence as possible. So long as any dismissal is in the ‘range of reasonable responses’ a tribunal will not substitute its view for yours.
The ACAS code emphasises the use of internal and external mediation. It is worth considering alternative routes available to avoid matters escalating to litigation. You should try to handle matters informally first but be aware that ‘informal warning’ notes on the employee’s personnel file with possible disciplinary sanctions for failure to satisfy the warning, might lose their ‘informal’ status. You could find you have started the formal disciplinary process without first having carried out the necessary steps.
Investigate thoroughly without unreasonable delay to establish the facts. This might involve an investigatory meeting with the employee or simply collating evidence for use at a disciplinary hearing (e.g. appraisal records).
Where possible, different people should carry out the investigation and disciplinary stages. An investigatory hearing should not result in any disciplinary action. There is no statutory right to be accompanied at a formal investigatory meeting.
Ideally, the investigating manager will prepare a report which will be sent to the employee with the hearing notification letter. The investigating manager should then be present at the later formal hearing.
If it is necessary to suspend an employee on full pay pending a disciplinary hearing for incompetence, keep the period of suspension as brief as possible and under review. Suspension should not be a ‘knee jerk’ or default action - always assess whether it is reasonable and necessary. See useful ACAS advice.
Write to the employee inviting them to a meeting to discuss their performance on at least 48 hours’ notice. Notify them of their right to be accompanied by a trade union representative or a workplace colleague. If this is not appropriate, e.g. in the case of a senior employee, consider whether to allow them to be accompanied by an external person (not a lawyer, HR manager, etc. unless in an exceptional circumstance the disciplinary action could be career-ending).
Set out the alleged concerns and any supporting documentation. Set out the possible consequences and if dismissal is a possibility, say so. Give employees a reasonable opportunity to call relevant witnesses at the disciplinary hearing (if either party intends to call witnesses, prior notice should be given to the other party).
If an employee is persistently unable or unwilling to attend a disciplinary meeting, without good cause, make a decision on the evidence available. You should inform the employee in advance that this could happen and suggest alternative ways of their putting their position forward, e.g. meeting off site or they could submit written representations for you to consider at the meeting.
At the hearing, read out the concerns and ensure the employee understands the allegations against them. Give them an opportunity to explain themselves. If concerns remain, ask them if there are any areas of training or support they feel are lacking.
Allow the employee to question any evidence from witnesses spoken to in the investigation. There is no need for the witnesses to be present and to have court room-style cross examination. The questions of the employee can be put to the witnesses by the disciplining manager in an adjournment. Full notes of the hearing should be kept. Copies of these should be provided to the employee after the hearing.
Adjourn before reaching your decision. Consider whether disciplinary or any other action is justified and inform the employee accordingly in writing (and of their right to appeal, see below).
If the sanction is a warning, ensure that you set out clearly:
the required improvements, the timescale and the fact that the capability process will be restarted should there not be an improvement
the faults that must not be repeated, failing which the process will also be restarted and
the consequences of failure to improve within the set period following the warning.
Ideally, try to agree a performance plan with the employee. If the employee unreasonably refuses to accept there is a performance issue, provided you act reasonably, you can insist your performance plan is put in place.
If the sanction is a dismissal, in most cases it will be appropriate to pay the employee in lieu of notice. In exceptional cases of gross incompetence, notice may not be due owing to a fundamental breach of the contract by the employee.
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