February 10, 2003by Kirtaner
How to tackle poor job performance – and bring down legal costs. 10 steps to managing employee performance problems through progressive discipline
HR managers spend a great deal of time and energy struggling with underperforming employees. And supervisors find talking with staff about poor performance one of the most difficult and unpleasant aspects of the job.
A performance management program can make the process more palatable for everyone. It’s a tool employers can use for discipline and corrective action, both to protect the organization from liability and to ensure an effective workforce.
One of the crucial elements of this approach is a system of progressive discipline which gives employees verbal and written warnings detailing consequences of continued performance problems. Here are 10 steps to managing employee performance problems:
1. Understand and convey the required role and expectation of each position. Analyze each job and develop a written description of every position in the organization.
Starting from the top and working down, descriptions should specify the main duties and expectations required of the job and provide management with general rights to change the requirements from time to time, as business conditions dictate.
Review the job description with employees on an individual basis to ensure they understand their duties and management’s expectations for performance. Job descriptions should be reviewed at least yearly, at which time expectations are set for the next year and any problems from the previous year are discussed. This review is in addition to the ongoing performance discussions, which should occur on an as-needed basis as part of the daily work routine.
2. Clearly communicate expectations, as well as unacceptable standards of conduct and the consequences of such behaviour.
It may be helpful to separate unacceptable behaviour into two categories. The first consists of behaviour resulting in immediate dismissal for cause. The second consists of behaviour resulting in corrective action and a performance improvement plan, which may lead to termination of employment if not achieved.
3. A corrective action process must be clearly defined, communicated to all employees and consistently applied.
The most common corrective action sequence is:
- Step 1: A verbal warning confirmed in writing to avoid any confusion or misunderstandings.
- Step 2: A written warning that outlines the problem, specifically describes the steps needed for the employee to improve, and identifies the consequences for failure to meet the requisite standard of performance.
- Step 3: Suspension, preferably without pay. Note that an employer must have a clear written suspension policy statement that is shared with the employee prior to the employee commencing employment; otherwise a suspension, with or without pay, may be seen by the courts as a constructive dismissal.
- Step 4: Termination of employment.
Some employers may include additional steps in the process where appropriate. In any event, management must reserve the right to deviate from the steps where it deems necessary at its sole and absolute discretion.
4. Managers must monitor employee performance and record concerns and achievements.
Good performance should be recognized, and poor performance dealt with in a timely and constructive manner. Remember that the goal is to correct the problem and not to punish the employee.
By paying close attention, and with honest communication, it will be easy to determine if the employee is capable of meeting the challenge or whether further corrective action is necessary.
5. If performance or attitude problems arise, immediately discuss them with the employee and document them properly. Make suggestions regarding improvements.
Show such documentation to the employee to demonstrate the nature of the difficulties, as well as your concerns.
6. If problems continue, management and the employee should develop a corrective action plan with realistic expectations and a realistic time frame.
Put this plan in writing, give the employee an opportunity to add any further comments and have him sign the document to show that it has been read. Schedule a specific date for a followup meeting. State in the plan that if further issues arise before that date, management will review the situation with the employee and take whatever steps are deemed necessary.
7. Give managers the training, authority and support needed to deal with poor performance so they don’t shy away from these issues should the employee flounder.
Lack of consistent followup will only mislead the employee into thinking requirements are being successfully met, and may lead a court to find the employer has condoned the performance shortfall.
8. If the employee successfully completes the corrective action program, confirm this in writing and advise the employee that the company expects him to maintain this standard.
If not maintained, management must reserve the right to deal with further difficulties at any stage of the corrective action process. The documentation related to the remedial program should be kept on file for a reasonable period of time — typically two years.
9. If the deficiencies continue, give a final written warning to the employee.
This may be issued at any point during the corrective action plan time frame. Ensure it is given before the corrective action period expires. The warning should reiterate the steps management has taken to assist the employee and the employee should be told what must be achieved within what is typically a very short time period, such as two to three weeks. Further, advise the employee in very clear language that failure to achieve these requirements will result in his immediate dismissal for cause. Managers must include this type of unequivocal language in the document for it to be accepted by a court as a final warning that continued employment is in serious jeopardy.
10. If the employee fails to meet the requirements, management is in a position to terminate employment for just cause and may be able to avoid liability for notice.
It should be noted that upon termination of employment, an employee may be entitled to statutory termination pay and possibly severance pay in accordance with applicable provincial employment standards legislation.
By following this approach, employers will have either a productive and motivated employee or they will be in a strong position to sever the employment relationship and prove to a court, administrative body or the employee’s solicitor that:
- there was a clear policy in place;
- the employee knew what was expected;
- the employee was informed verbally and in writing of the deficiencies;
- specific examples, guidelines and corrective plans were provided to assist the employee;
- the employee did not sufficiently remedy the problems;
- the employee received a final warning that employment was at risk;
- the employee ignored or continued to fail to meet job requirements; and
- therefore, the termination of employment was justified and should not result in any liability for the company.
What the courts are saying…
An employee with known problems of substandard performance was offered the position of cleanup foreman when his previous position with Intercontinental Packers in Saskatchewan was abolished. At the time of the offer, management was aware this employee had performance issues including difficulty managing and supervising people, lack of followup and a negative attitude.
The employee was advised when he accepted the position that if within six months he did not meet his employer’s standards of performance, his employment would be terminated.
Roughly five months later, the employee was dismissed for just cause on the basis that he was unwilling or unable to carry out the duties and responsibilities of his position despite further warnings and advice.
The court held the employer had not established just cause despite the existence of a series of management memoranda documenting the employee’s unsatisfactory performance. In particular, the court felt the employer had a greater responsibility to give detailed instructions to the employee regarding the requirements of his new position because it was well aware of his poor performance issues after having employed him for nearly 21 years.
Additionally, the court stated that for the employer to summarily dismiss the employee, it should have warned him in very clear language that a failure to improve the quality of his work would result in termination of employment.
In the absence of such warnings, and without having provided additional training and supervision to the employee, whose shortcomings were known to his employer, the employee could not be dismissed for cause.
Van Houwe v. Intercontinental Packers Ltd.,  S.J. No. 555 (Sask. Q.B.)
Road King Truck Stop of Alberta hired a general manager for its Travel Centre Truck Stop. He didn’t work out. Shortly after commencing work with his employer, a meeting was held to advise him that there were serious issues with staff morale and concerns regarding the manner in which he treated employees and managers. The evidence established that the employee’s behaviour was unprofessional, and that he was overbearing, demeaning and discourteous to employees. The employee was then asked to develop a work plan to correct the deficiencies in his performance. A work plan was prepared by the employee and presented at a meeting with management.
Another meeting was held, and the employee was advised he would no longer be employed as general manager. A subsequent letter confirmed this decision in writing. This letter also outlined the employer’s concerns with the employee’s performance in the position of general manager, and offered him a three-month consulting contract. The court held the employer had established just cause for dismissal. The level of performance required from the employee was properly communicated to him prior to his dismissal, and he was given appropriate instructions in order to meet that standard. The employee had failed to meet the requisite standards of performance for his position, and accordingly, his employment could be terminated for cause.
Kuntz v. Road King Truck Stop Ltd.,  A.J. No. 539 (Alta. Q.B.)
Peter Israel is the senior partner in the Toronto law firm of Israel Foulon LLP – Employment and Labour Lawyers. He can be reached at 416-640-1550 or email@example.com. The author would like to thank Carita Pereira for her assistance with this article. A version of this article originally appeared in the Carswell publication, Canadian HR Reporter.