Supporting your team while protecting your business
Let’s face it – having a conversation with an underperforming employee isn’t on anyone’s list of favourite things to do. But in the fast-paced world of business, underperformance can have a serious ripple effect. It can damage productivity, harm team morale and even impact your bottom line.
That’s why it’s essential to handle poor performance swiftly, fairly and legally. This guide breaks down what you need to know to manage the process with confidence and compassion.
What is poor performance?
Poor performance, also known as underperformance or capability issues, happens when an employee isn’t meeting the expectations of their role. This could include:
- Missed deadlines or targets
- Frequent mistakes or low-quality work
- A lack of initiative or motivation
- Difficulty working with others or taking feedback
It’s important to distinguish between poor performance and misconduct – they’re handled very differently. Misconduct (like repeated lateness or inappropriate behaviour) relates to an employee’s behaviour, while poor performance is usually about capability – whether they’re able to do the job effectively.
Step 1: Spot the signs early
Don’t wait for things to spiral. As a business owner, your instinct might be to give someone “a bit more time”, but it’s best to act sooner rather than later. The longer you leave it, the harder it becomes to tackle.
Ask yourself:
- Is this a temporary dip, or a longer-term issue?
- Have you given clear expectations?
- Have they been supported adequately?
Documenting your concerns and any relevant evidence is also a good idea. Keep notes of missed deadlines, underwhelming performance reviews or customer feedback.
Step 2: Start with an informal conversation
Before jumping into formal procedures, have an honest, informal chat with your employee.
Keep it supportive. The goal is to understand the “why” behind the issue. Is it a lack of training? Low motivation? Personal issues? Or perhaps they’re not clear on what’s expected.
Be specific about what needs to improve, and agree on a timeframe to review progress – typically 4 to 6 weeks is reasonable.
Step 3: Develop a performance improvement plan (PIP)
If things don’t improve after your initial conversation, it’s time to formalise the process.
A Performance Improvement Plan (PIP) outlines:
- What the issues are
- What “good” looks like
- What support will be provided (e.g. training, mentoring)
- Timeframes and review points
- The consequences if performance doesn’t improve
A good PIP is a roadmap – not a punishment. The aim is to help the employee succeed.
Step 4: Follow a fair and lawful process
If performance still hasn’t improved after a reasonable period, you may need to consider dismissal on the grounds of capability.
This is where it’s crucial to get HR advice.
You’ll need to ensure you’ve:
- Followed a fair procedure
- Given the employee opportunities to improve
- Made reasonable adjustments (especially if disability is a factor)
- Provided written warnings, if required
Failure to follow a fair process could land you in hot water – even if the employee is clearly underperforming.
Step 5: Learn from the experience
Dealing with underperformance is tough – but it also presents an opportunity to look at your wider processes:
- Are your job descriptions clear?
- Are expectations communicated early and often?
- Do managers feel equipped to have difficult conversations?
- Is regular feedback part of your culture?
Taking steps to prevent poor performance in the first place is always better than managing it down the line.
Need support?
Whether you’re facing a one-off situation or need help creating a full performance management process, Haus of HR is here to help. We take the stress out of tricky situations and help you protect your people and your business.
Let’s talk – book a free HR consultation with our friendly team.