Letting go of a poor performer can be the hardest decision you have ever made
It’s not easy to let go of a poor performer. But it can be done. Here in the UK there are certain guidelines and legislation we have to observe. After all, there can be few more serious decisions than having to take away someone’s livelihood. Here I describe the 6 steps you are advised to take when you have come to a decision to terminate the employment of someone who is consistently not performing to the standards required.
Terminating your contract with an employee is very much a last resort. The law around the dismissal of an employee is fairly straightforward on the face of it, although can get complex depending on the issues involved.
Terminating a contract with a poor performer is construed a “fair dismissal” under current UK employment law. However, where many employers become unstuck is the test of “acting reasonably”. If you follow the steps in the article how to manage a poor performer, and also make sure you have followed ACAS guidance; have been respectful and objective with your employee, you are more than likely to have acted reasonably.
Legislation says that employees can’t claim unfair dismissal unless they have:
- at least one year’s continuous service for employees in employment before 6th April 2012;
- two years for employees starting employment on or after 6th April 2012.
While this is helpful for employers in some respects, it is a bit of a red herring when deciding whether or not to terminate an employee. The fact that an employee might not have any right to appeal a decision to terminate does not mean an employer should not still act reasonably for ethical and reputational purposes.
In certain circumstances, you may wish to negotiate a settlement agreement (PDF, 1.6MB). This can be introduced at any stage in the proceedings.
The Six Steps
Once you have gotten to the point where you have supported your employee in every way you can to help them to improve their performance, and you know the time has come to let them go, there are some basic steps to take.
- You must have all documentation to hand and make sure that you have properly followed company policies and at a minimum the ACAS Code of Practice on dismissals (PDF, 0.8MB). Check over to make sure it is all in order. If you have any doubts do seek legal advice from an employment lawyer.
- Understand the risks. Even if you are tight on your procedures, there may still be some risk if the employee does take you to an employment tribunal. Understanding the risks means you are prepared for what might happen. Risks might include financial penalty and/or damage to reputation. Again, if you don’t understand the risks then do seek advice from a good employment lawyer.
- You must inform the employee that you have made the decision to terminate their employment as set out in the ACAS Code of Practice. They are entitled to be represented at that meeting. While the employee may be surprised you have come to the decision to terminate, the reason and the facts around their poor performance should be well known to them, having worked with you for some time to improve their standards.
- Depending on the circumstances, you may wish to invite the employee to resign. This lets them save their reputation, and increase their chances of gaining more suitable employment, which is important especially if they have simply been in the wrong job.
- You may wish to pursue a settlement agreement, at this late stage, if there are disputes arising from the process of managing performance.
- You might simply want to give formal notice, in writing, of their dismissal. They can then work out their notice. You may ask them to leave immediately, and pay them in lieu of notice, but generally only if such a provision is made in the contract of employment.
Terminating someone’s employment is a daunting task, and certainly not one which should be taken lightly. However, sometimes it is necessary because the consequences of inappropriately continuing employment can have far-reaching effects on your business and your team.
What have your experiences been of having to let an employee go? How did you handle it? Leave a comment below.