Business Toolbox

Here are some frequently asked questions that have recently come through our Employee Relations Helpline (ERH), answered by our experts.

As a CCIWA Member, you get unlimited access to our helpline. We are here to help you manage your employee relations needs. This includes prompt advice on your circumstances, consulting, documents such as kits and guides and up-to-date industrial relations information.

Q: What are the legal obligations during the performance management process?

A: Firstly, it is vital to understand the problem and how it is impacting the organisation and/or other workers. Employers should clearly record examples of the poor performance including specifics where they are underperforming, what the required performance level is and any support the company has provided as this will assist with guiding the conversation with the employee. It is important to be specific.

Underperformance is best addressed through performance management, while misconduct is best addressed through a disciplinary process.

Once the poor performance has been clearly defined, a confidential meeting should be held with the employee to communicate the concerns and gain their views on the situation. Depending on the severity of the poor performance, this could be an informal discussion resulting in a casual comment or could be a formal performance management meeting to discuss and put in place a performance improvement plan (PIP).

Once the employer is clear on the poor performance, the gap between the current performance and the required level, and gathered any potential reasons for the poor performance, the right level of action can be selected.

The legal obligations during such a process includes ensuring procedural fairness is met including:

• Clear goal setting;
• A right to respond by the employee; and
• A reasonable timeframe for them to show improvement before issuing any written warnings or termination due to continued poor performance.

It is also usually best practice to invite the employee to bring a support person/witness to the meeting if they wish.

Q: Can I implement new KPIs and then performance manage?

A: Performance managing an employee against new KPIs may not be a possibility. There are several factors to consider, including:

• When were the new KPIs implemented?
• How were they communicated to employees?
• Was there a grace period to allow employees to work toward the new KPIs?

If the KPIs have not been in place for a long period, there was a lack of communication to employees, and there was no grace period for employees to demonstrate they could fulfill the new KPIs, it may be unreasonable to place an employee on a PIP. Instead, consultation to re-explain new expectations is the most appropriate course of action.

However, if the new KPIs have been in place for some time, there was sufficient communication from the employer, and employees had a grace period, then you could look at potentially placing an employee on a PIP. A PIP could also be appropriate if an employee has shown they can meet the new KPIs, but then there is a noticeable decrease in performance without an external explanation for it.

Q: What can I include in the PIP? And what is a reasonable timeframe for it to be completed?

A: A PIP generally comes into play when an informal approach to addressing underperformance does not solve the issues. A PIP can be implemented where there is a significant gap between an employee’s current performance and the appropriate level of performance.

A PIP will generally outline:

• A summary of the current level of performance and why it is not satisfactory;
• A summary of the required level of performance;
• The support the company will provide to the employee to obtain the appropriate level of performance. For example, additional training or coaching by their manager;
• The timeframe the PIP will be in place and how often periodical reviews will be completed; and
• Any potential outcomes of not successfully completing the PIP – e.g., written warnings for failure to meet requirements and up to and including termination.

A PIP is an ideal way to give a struggling employee the opportunity to improve their quality of work. But it does take time to oversee and organise.

When setting timeframes, consider the employee’s roster, any upcoming leave and how long it will reasonably take for you to see an improvement. Typical timeframes for PIPs are around 60 to 90 days.

Please note, this can be complex. Please call one of our helpful team on (08) 9365 7660 for tailored advice and assistance when putting together a PIP.

Q: What happens if the employee is unsuccessful in completing their PIP?

A: If an employee does not successfully complete their PIP, we must first assess to what extent the employee has not been able to fulfill the tasks/standards that have been listed on the PIP. In some cases, the employee may have completed 25%, 50% or 75% of the tasks listed. This is important to note as it will determine the most appropriate next step to take.

If an employee has completed most of their PIP, a PIP extension is likely the best option to allow them some additional time and/or training to complete the tasks they have not yet done.

If half of the PIP is completed, then a secondary PIP is likely the most appropriate as the employee has shown they have the potential to perform at the standard required, but are not there yet. A second PIP allows for another opportunity for the employee to prove themselves.

If nil or very little of the PIP has been completed, then an employer may consider giving a written warning or termination based on underperformance. However, this can be difficult to navigate so it is recommended to contact the Employee Relations Helpline for further assistance.

For general employee advice and guidance, contact CCIWA’s Employee Relations Helpline on (08) 9365 7660 or email [email protected].