October 3, 2018

how to dismiss an employee for poor performance

Dismissing employees for poor performance is relatively straightforward for staff that have not been employed continuously for two years or more. 

If an employee has been employed for longer than that period, an employer must have a ‘potential fair reason’ for dismissing an employee who has been employed for more than two years, and they must follow a fair process when terminating their employment if they are to avoid a claim of unfair dismissal.

One ‘potentially fair reason’ for terminating an employee’s employment is for poor performance, i.e. if they are incapable of performing their job to the standards required by the company.

It is imperative that when undertaking any form of process that could result in the termination of an employee’s employment, you ensure that you are acting as a ‘reasonable employer’. It would help if you always tried to deal with issues fairly and in line with defined procedures. However, equally important is ensuring that you have a full audit trail of the process that you have followed.

The 10 Steps to dismissing an employee for poor performance

  1. 1
    Reasonableness
  2. 2
    Appraisals
  3. 3
    Formal Warnings
  4. 4
    Evidence
  5. 5
    Formal Performance Management Meeting (1)
  6. 6
    First Improvement Notice
  7. 7
    Formal Performance Management Meeting (2)
  8. 8
    Final Improvement Notice
  9. 9
    Dismiss Employee For Poor Performance
  10. 10
    Alternative Job Role?

1) Reasonableness

The burden of proof falls on the employer to show that the dismissal was fair and reasonable in all the circumstances of the case and that dismissal was ‘within the range of reasonable responses’ of a reasonable employer.

That being the case, if you do not feel an employee is performing to the standards required by the Company, you would first need some evidence to base this belief upon.

2) Appraisals

Appraisals are a good way of showing that an employee has not been performing and also that you have raised these issues with them. As part of showing that the dismissal was fair, you also need to be able to prove to the Tribunal that you have given employees time, support and training to try and help them achieve the standards you require before dismissing them.

3) Formal Warnings

You also need to have given employees clear formal warnings (following a process such as that set out below) when their performance is failing, and also to advise them of the potential consequences should their performance not improve.

4) Evidence

If you believe that an employee is not performing adequately, you should first gather as much evidence as possible that shows that this is the case.

This could include documents such as appraisals, work records or witness statements from colleagues or managers as to why the employee is not performing. You need to be able to show that you carried out a fair, reasonable and thorough investigation into the employee’s performance before starting the formal action.

5) Formal Performance Management Meeting

Once you have gathered this evidence, you should invite the employee to attend a formal performance management meeting. In the letter, you should set out clearly the areas of concern that you wish to discuss with the employee and advise them as to what a possible outcome of the meeting could be. You must also inform them that they have the right to be accompanied by a work colleague or an accredited trade union and provide them with the evidence you will rely upon at the meeting.

6) First Improvement Notice

During the meeting, you discuss the areas of concern with the employee and if there is no reasonable or substantial explanation for their poor performance, you could issue them with a First Improvement Notice. Likewise, if there is a reason that the employee is underperforming, for example, if they are ill, have too much work or are potentially stressed, you need to take this into account before issuing a formal Improvement Notice.

If it is appropriate to issue a formal Improvement Notice, you should confirm this in writing to the employee, setting out the areas that need improvement, any support that you will provide the employee to enable them to improve and over what period you expect to see an improvement. You should also inform them of their right to appeal against the decision which, ideally should be to a higher level of management.

7) Formal Performance Management Meeting (2)

If the employee’s performance still does not improve following the formal warning, then, provided you have provided them with the support and training identified during the meeting with them (which should all be documented thoroughly), you may then invite them to a further formal performance management meeting following the process set out above. Inform the employee that one of the outcomes of the meeting could be that they are issued with a Final Improvement Notice.

8) Final Improvement Notice

Again, during this meeting, you should explore possible reasons as to why the employee may not be performing and try to ascertain if there are any further measures you can take to try and help them attain the standards required. If appropriate following this meeting, you could issue the employee with a Final Improvement Notice.

Following this warning, if the employee still does not improve, and you have taken all steps that could be expected of a reasonable employer trying to help an employee improve their performance, you should invite the employee to a final formal meeting (always following the guidelines set out above). Inform the employee that one of the possible outcomes of this meeting could be the termination of their employment.

9) Dismiss Employee for Poor Performance

At the final meeting, it is again vital to show that you have consistently tried to help the employee improve their performance by providing them with any help, support or training that they have indicated would help them improve.

If they have still not improved, you could then decide to terminate their employment based on poor performance and the fact that you believe that the employee is incapable of doing the job.

When considering whether a dismissal is fair, a Tribunal will look at whether the dismissal was within a ‘range of reasonable responses’ and will consider whether the dismissal was fair in all the circumstances of a particular case.

10) Alternative Job Role?

It is essential therefore as part of your decision-making process that you consider whether some other sanction could be appropriate, for example, demotion or a move to an alternative job role that is within the employee’s capabilities.

A dismissal for poor performance must be with notice and unless the employee’s contract of employment states otherwise, the employee will be entitled to one weeks’ notice for each completed year of service (subject to a maximum of 12 weeks’ notice for 12 years’ service).

You are entitled to request that the employee work their notice. However, you may take the view that they are unlikely to be effective given that their employment is to be terminated. If that is the case, you may place the employee on garden leave for the remainder of their notice period or pay them in lieu of their notice. You can only take these courses of action if there is a clause in the employee's contract that allows you to do so.

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About the author 

James Rowland

James is the Commercial Director at Neathouse Partners and regularly writes articles surrounding issues in HR & Employment Law. Outside of the office, James is a keen Cricketer, playing in the Cheshire League for Nantwich CC. He also loves going to watch his football team, Crewe Alexandra. Feel free to connect with James on LinkedIn.

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