Continuing with the HR Improve series for this year, this month we focus on effective performance management. Performance management is key to the success of individual employees and the organisations they work for. So why is it so hard to get it right?

Performance management is a process between a manager and their direct reports to ensure the expected level of performance is achieved and maintained. Where problems with performance arise, the process can become involved and lengthy, and as a result it is not always done effectively. This has been exacerbated by the fact that many employees are now working remotely, at least for part of their working time, making it harder for managers to evaluate work being done and giving more opportunity for problems to fester without being addressed.

So, what steps can employers take to ensure performance is managed in an effective way?

Be clear about what is expected

• Setting clear performance metrics at the outset is a good way to ensure potential issues are identified early on and support is put in place where needed. However, not all roles lend themselves to easily measurable targets. In such cases, it is even more important to clearly set out expectations around working patterns, productivity and outputs 
• Investment in technology and/or data analytics to assist with this is likely to be necessary. It is key that employers have clear evidence to support any performance concerns, so that these can be addressed effectively with an employee. Such analytics will need to balance the employer’s interest with the individual’s reasonable rights to privacy and data protection. Employers that are looking at using any monitoring technology should have clear reasons for doing so and explain to employees what they are doing and why before implementing it
• Conducting regular supervision is also important. Given the increased flexibility around working patterns, it is essential that managers make a conscious decision to catch up with team members, diarising time to speak to colleagues for monitoring workload and providing feedback. Doing this in a spontaneous or ad hoc way will inevitably mean issues are missed or allowed to fester without being addressed

Make sure employees have the right tools to succeed

• Managers should develop their direct reports to have the skills and ability to deliver the expected levels of performance. Identifying and addressing training needs and agreeing personal development plans will help to prevent performance issues arising in the first place
• Alongside this, ensuring that employees have the right equipment and tools they need to carry out their work effectively will also head off many potential issues 

Be proactive

• Don’t delay in addressing issues that do arise. Given the nature of performance management, it can often seem easier to wait it out. However, giving constructive feedback, allowing an employee to comment on any concerns raised and agreeing a way forward promptly on an informal basis is more likely to mean issues can be resolved and appropriate support put in place to assist the employee in question. This will also make the performance process easier in the long run because if the issue persists, the employer is already well placed to progress to a more formal stage of the process 
• Keeping records of discussions, even those held on an informal basis, and of any actions agreed upon, is important to demonstrate what steps have been taken to address concerns
• Take time to explore the potential causes of any performance issue with the employee. Performance issues may be the result of something occurring in the employee’s personal life or with their health. An employer should seek to determine the true reason for the issue before deciding on next steps, otherwise they may leave themselves open to a discrimination or unfair dismissal claim
• Consider what additional support is needed to help the employee to address any performance issues. For instance, this might include training on new systems, providing updated equipment or software, giving them a mentor or buddy or holding more regular supervision meetings with them. Equally, if the issue is a result of personal or health concerns, the employer may be able to direct the employee to support groups or refer the employee to occupational health for more information

Take a more formal approach if needed

• If informal discussions and the provision of additional support do not resolve the issue, then it may be necessary to move to a formal performance management process. This will involve meeting with the employee to discuss the concerns, having set these out in writing to the employee in advance of the meeting along with any relevant documents or evidence that support the concerns. Remember an employee has the right to be accompanied at a formal meeting that could result in any performance warning being issued. The employee should also be warned of the potential outcome of the meeting 
• Detail the performance concerns during the meeting and allow the employee the chance to explain what has happened. If underperformance is established, a performance improvement plan can be put in place alongside a formal warning being issued. The ACAS Code recommends that at least two warnings are given before an individual is dismissed for poor performance. Confirm to the employee in writing the outcome of the meeting and their right of appeal
• Include in the performance plan clear and reasonable objectives for the employee to achieve within a reasonable period and explain what will happen if those objectives are not met. The objectives should reflect what is expected of the employee, be time bound and be measurable so that there is no dispute over whether they have been met. While performance plans should be challenging, make sure that they are realistic and achievable. The purpose of a performance plan is to get the individual to the required standard, not to set them up to fail
• Consider what further support or training might help the employee to meet the set objectives and arrange for this to be provided 
• Diarise the period given to the employee for improvement and any agreed dates for review or monitoring of the employee's progress and ensure these are met. As mentioned above, keep a full record of the employee’s performance throughout the process as it can assist with discussions during review meetings as well as providing evidence should further warnings be needed

Dismissal should be the last resort

• If the employee's performance does not improve despite repeated warning and support, consider dismissing the employee on grounds of capability (this being one of the five potentially fair reasons for dismissal). An employer will have to show that it had a reasonable belief in the employee's inability when it took the decision to dismiss for capability reasons so there must be clear evidence of the poor performance and a lack of sufficient improvement despite the support offered to the employee
• Remember that, whilst there is no absolute obligation on an employer to consider alternative employment or demotion before taking the decision to dismiss, it may be unreasonable not to do so depending on the size and administrative resources of the employer