Legal HR advice for companies


Capability Under Performance

Why Manage Under Performance in the workplace?

Improving performance across the workforce is a balancing act between the need to reward excellence and addressing those who fall below expected standards.

Why is it important?

A failure to address under performance has serious consequences for employers, such as:

  • low morale and disaffection amongst over pressurised staff
  • High turnover
  • Recruitment costs
  • Delayed and substandard output
  • Disruption of flow of service
  • Customer dissatisfaction
  • Increased costs for agency employees
  • Legal costs Employment Tribunal compensation
  • Lost opportunity (time spent on management negatives rather than planning positives)
  • Health and Safety risks from inadequate temporary cover
  • Damage to reputation.

The cost to the business is enormous but easy to ignore as it is largely hidden. If the problem reaches a “straw that broke the camel’s back” situation and an employee is dismissed at short notice without following a proper procedure, the costs of an employment tribunal claim, or ACAS settlement, for unfair dismissal can be high.

Claims for under performance dismissals are more open to interpretation by the tribunal and thus the views of any one particular tribunal Judge. Tribunal claims are costly in terms of any award made, legal fees, and compromise agreements, not to mention the significant amounts of management time taken up in preparation and attendance at the tribunal. Many employers decide for commercial reasons to enter into settlement agreements rather than incur the costs of defending a claim. This is not an easy way out of ignoring the proper procedures; the stronger the case the less an employer need pay in order to settle.

Under performers absorb disproportionate parts of the management time and frequently continue to underperform or leave. Better performers are ignored and may become disillusioned as their efforts become watered down by those not performing and the lack of management action to resolve the problem. This may ultimately cause the good worker to reduce the quality of their work and they may eventually leave.

Why do Managers Avoid dealing with it?

Most people do not like face to face confrontation and avoid difficult conversations which they feel are personal because they feel awkward and unsure of how to deal with it. They are often also concerned about the atmosphere of the working relationship in future. Having a clear understanding of the rights and responsibilities of both the employer and employee gives the manager confidence to manage problems fairly and firmly.

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Disclaimer: The site provides best practice HR advice based on current Employment Law but it should not be taken as a substitute for professional legal advice.