The employment arena is shifting: the pandemic led many to reevaluate their time and priorities, and its aftermath has led to hybrid workplaces, non-work from home requirements, and ‘quiet quitting’.
Nearly six out of ten employees are said to feel disengaged from their organisation. This period of disillusionment risks a growing trend of (both actual and perceived) poor performance which employers will need to feel equipped to deal with. In this new and evolving landscape, employers should be alive to the common pitfalls of managing poor performance in order to motivate employees, reduce risks of potential legal action and increase levels of productivity and fulfilment. Below are some key pitfalls to avoid when managing an employee’s performance.
1. Not addressing issues promptly
The ACAS Code of Practice on Disciplinary and Grievance Procedures recognises the need to act quickly and inform employees of any problems with their performance. Waiting for small incidents to escalate until they require formal action can lead to a decrease in productivity or employees getting used to a particularly problematic way of working. It can also become harder to raise and justify feedback the longer you leave it.
Often, an informal meeting or conversation is all that is required to prompt an improvement in performance. However, it should be noted that although an informal approach to many incidents may be more effective and appropriate, you should ensure that you make notes of any agreed action that will be taken and when reviews of progress are going to occur (for more on which see below).
2. Failing to use a formal procedure when necessary
In some circumstances, using a formal disciplinary procedure may be necessary when dealing with performance issues, for example if there has been no or insufficient improvement in performance following an informal meeting. In order to conduct this process fairly, you should follow the ACAS Code as well as your organisation’s applicable policies. For more information about the formal process that should be followed, please refer to Tabitha Juster at Farrer & Co’s blog here where she shares her top tips for managing poor performance.
3. Not utilising the appraisal process
The appraisal process is a useful tool in keeping on top of performance issues. You should schedule regular appraisals for the employees that you manage. This process should not be seen as a tick box exercise but instead should be a specific opportunity to discuss performance and set goals for improvement. Good appraisals take time and to maximise the value gained from these, you should set aside adequate time to prepare for each appraisal and to action any follow up points that are agreed as part of this
4. Giving overly positive reviews
Having difficult conversations can be daunting. However, if you provide overly positive and unrealistic reviews of an employee’s performance, this can create a false sense of security and can lead to employees having misconceptions about their own performance. Not only will this give them no reason to make any changes to their performance, it can also undermine attempts to introduce formal performance management procedures in the future.
Poor performance can be addressed in a way that is respectful and empathetic, while still being realistic, so that it avoids an employee feeling blindsided if performance issues are raised later down the line. No employee is perfect and constructive feedback is an essential tool in helping employees to improve their skills and productivity at work.
5. Failing to offer training or time to improve
One of the contributors that can lead to poor performance is inadequate or insufficient support or training. During any training, expectations should be reiterated to employees to ensure that they are aware of the standards expected of them. If you have raised performance issues with an employee, you should give them sufficient time to improve in their role before taking any further action.
Failure to offer proper training and opportunities to improve in the performance management process exposes employers to risks of claims of wrongful and unfair dismissal and can lead to an unmotivated workforce. The ability of an employee to learn from their mistakes and feel able to invest in professional development is crucial.
6. Failing to keep proper records
It is important that you don’t fall into the trap of failing to keep accurate records when reviewing performance. These records will be the first line of defence for the employer if any claims are brought and can help to demonstrate that performance evaluations were conducted in a fair, non-discriminatory way which followed the organisation’s applicable policies.
You should also keep in mind when producing these documents that they could become disclosable at a later date (for example, in the context of a subject access request or possible litigation), so you should be conscious to avoid any careless comments in these that could be looked upon unfavourably by an employment tribunal.
You should not set unclear or vague goals when setting objectives. Objectives should be SMART: Specific, Measurable, Achievable, Relevant and Time Limited. It is important that employees are aware of what is expected of them in the context of their objectives. You should agree with the employee objectives that are realistic to avoid them feeling like they have been set up to fail, and there should be a mechanism by which their progress can be measured.
Unconscious bias is something that all of us will have, but managers should take steps to address this in their decision making when it comes to providing feedback, conducting appraisals etc. For example, you may unconsciously provide better ratings to an employee who is similar to you in terms of background, interest, skills etc. To overcome potential bias, a set of objective, performance based questions can be implemented in the performance management process by those who line manage employees.
There is also a danger of the recency effect creeping in, where you focus on an employee’s most recent period of work rather than the total time period you should be taking into account when reviewing their performance. Taking steps such as collecting regular employee feedback can help to limit this risk.
There are various other forms of unconscious bias and you should ensure that you are familiar with these so that you can be proactive in minimising the effects of them in the management of employees.
For more suggestions on effective performance management, see our top ten tips.
With many thanks to Winnie Robinson-Fell, a current trainee in the Employment team, for her help in preparing this blog.
This publication is a general summary of the law. It should not replace legal advice tailored to your specific circumstances.
© Farrer & Co LLP, November 2023