A member of your team is under-performing, but you can’t just fire them straight away. There is a process called Performance Management that has to be adhered to before you can legitimately fire a member of your staff. The process ensures that you have communicated the goals of the business clearly to the staff member and agreed with them what their role in meeting those goals is.
So what do you do as a small business owner when an employee’s performance drops?
1 – Find out the reason for poor performance
First things first, never jump in at the deep end and assume the worst. Speak to your employee and when you raise the subject of their poor performance ask them if there is a reason behind it. Being understanding and kind at the outset can really pay dividends in the long run. It could be that there is a personal issue meaning their work is not at the right standard. Are they going through a divorce or have an ill relative? Whilst you may prefer staff to leave personal issues at home, in reality, that isn’t always possible.
If they have a health issue, you may need to tread carefully. Disability discrimination claims can cost employers a lot of money. And the definitions of disability are probably broader than you think. Just take a look at our blog post on it here.
Understanding the issue means you are more likely to be able to help. If it turns out that there is no underlying personal or health issue, and it is simply a lack of knowledge or skills to get the job done then you may consider starting a programme where you monitor the employee’s performance. More detail on this in step 3.
2 – Think about the costs of hiring and managing the employees’ performance
Often people say they can’t afford to spend time on a lengthy performance management process, but don’t forget hiring staff is expensive too. If you’ve invested in recruiting someone it is usually worth taking some time to ensure employees are performing well.
To ensure the process is as effective as it can be it is worth remembering the following principles:
- Be clear about what the problem is with the staff member’s performance, giving specific examples of when it’s been below par, so they understand exactly what they need to improve.
- Listen to any feedback they may have which could help you to understand how to proceed.
- Offer support to the employee — either with additional training or extra supervision.
- Keep detailed notes of conversations, the employees progress and the goals you agree.
These points are critical. Should you move towards dismissal later on, you are required to prove that you have listened and done everything you can to help the employee perform at their best.
3 – The performance management process explained
Once you have identified the problem and ruled out any health or personal issues you can proceed with the formal performance management process. Sometimes also known as a capability process.
Note: if you discover that the problem is actually due to bad behaviour. I.e. your employee has the skills to do the job but can’t be bothered (and you have evidence of this) you would use the disciplinary procedure instead.
The performance management process mirrors the disciplinary procedure in terms of there being a series of formal meetings, warnings and appeals but the focus is on improving performance and therefore it focuses on three areas — goals, monitoring and feedback.
- In the first formal meeting with the employee, you should suggest tangible goals for them to achieve. Ensure it is something you can really measure, as this will help any arguments for dismissal — should it come to that. Examples of measurable goals may include the number of phone calls they make in a given period, the number of sales they make, arriving to work on time consistently.
- You must also, crucially, have the employee agree to these goals. It’s no good imposing a set of targets that they feel incapable of achieving. If they don’t agree you will start the process with a demotivated employee, and you will fail to see improvement.
- Monitoring should take place over a ‘reasonable’ time period. This will usually be minimum of a month, and can be as many as three depending on your business.
- Speak to the employee throughout the process about how they are performing providing constructive feedback. You should look at how they are performing against their agreed goals together. This also helps to ensure there are no surprises..
- At the end of the agreed time period you must decide whether to move forward with a disciplinary procedure or take no action. If the employee has performed well but not achieved the goals you may decide to extend the monitoring a little longer, or give them some additional training.
4 – Is the employee’s behaviour the problem?
One thing to remember when thinking about the performance management process is to ask “is it because they can’t do it, or won’t do it?”. This can help you understand whether their performance issues are due to bad behaviour which is much harder to change.
If it is the case that they “won’t” do the work to an acceptable standard, then you’ll likely need to proceed with the disciplinary process as we mentioned earlier.
Working with your staff to improve their performance and investing in their skills can have all sorts of benefits across your workforce. Happy, motivated employees will help push you up the hill to achieve your business goals. This process exists to help both the employer and the employees, and when it works can have wonderful results.
If you need help with managing your staff, our HR experts are here to help. Simply call 0333 444 0165 or email firstname.lastname@example.org to find out more about our HR support.