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Introduction to this document

Dealing with poor performance checklist

This checklist is intended for cases where performance cannot be managed by the normal appraisal system, and the outcome may be dismissal if performance is not improved.

Potentially fair dismissal reason

Under the Employment Rights Act 1996 one of the five potentially fair reasons for dismissal is capability, which is defined in the legislation as meaning the employee’s “capability assessed by reference to skill, aptitude, health or any other physical or mental quality”. So, provided you follow a fair warnings procedure to its natural conclusion and you act reasonably in treating capability as a sufficient reason for dismissing the employee, then it should be a fair dismissal. The legal test is whether your dismissal decision was within the “band of reasonable responses” open to you, so you’ll need to show you gave the employee sufficient opportunity to improve and you did what you could to support them. The performance issues will also need to be more than minor or trivial.

You should also follow the Acas Code of Practice on Disciplinary and Grievance Procedures as this covers performance dismissals. It provides that, following the performance review meeting, you must inform the employee of your decision and of their right of appeal.

Can’t or won’t perform?

It’s possible to deal with performance issues through your disciplinary procedure. However, where the issue is one of “can’t perform” (due to lack of capability) as opposed to “won’t perform” (for example, because of laziness or a negative attitude), it’s much better to opt for a performance review procedure which should be aimed at assisting the employee to improve their performance, rather than seeking to attach blame.

Alternative employment

Unlike disciplinary dismissals, prior to taking a capability dismissal decision, you should also give consideration to offering any available alternative employment which is within the skill and capability level of the employee. This may be on less favourable employment terms, such as a reduced salary, as it is likely to be a lower level job. You can’t demote the employee or transfer them to an alternative post without their express agreement, so this would be one for them to choose to accept or not.