July 5 Tip of the Week
“Performance Improvement Plans: Effective Tool or Booby Trap?”
One of the hardest, but most important jobs, of an employer is to hold employees accountable for their job performance and attitude at work. A disaffected, marginalized, or disgruntled employee is a toxic element in any workplace. Good employees see employees who get away with poor performance and bad behavior and question why they continue to work hard and do a good job, when that employee gets away with murder. Bad employees learn from other poor performers and look for ways to beat the system or fly under the radar. Good supervisors know this and work diligently to hold their employees accountable and to ensure that all of their direct reports make positive contributions to the work environment.
One tool that can be used to introduce accountability into the workplace is the performance improvement plan or a “PIP.” PIPs are a great way to take a bad employee and make them into a good employee. To work, however, they must be done right. The answer to the question posed in the title of this Tip of the Week typically depends on your perspective, with supervisors who have a genuine investment in their employees and a desire to see them success viewing PIPs as an effective tool. Supervisors who are frustrated and are chomping at the bit to get rid of their “problem employees” see PIPs as the necessary first step to termination. And, an employee who is presented with a PIP will generally see the PIP as the writing on the wall – if not presented properly, the employee will feel that they do not have a genuine opportunity to improve and it is only a matter of time before they are fired, making the PIP an exercise in futility.
In today’s workplace, employers are having difficulty recruiting workers and are required to invest significant resources in the training and onboarding of employees. PIPs are time consuming and require significant effort from the employee, the supervisor and the human resources staff, but they can be an excellent tool in retaining employees and protecting an employer’s investment in an employee. This is only true, however, if all involved in the PIP are committed to it and are open to a positive result. If a supervisor or an employee goes into a PIP with a foregone conclusion or a defeatist attitude, they might as well not bother. If termination is the intended outcome, then a PIP is not appropriate and should not be used. In fact, a poorly drafted or poorly implemented PIP can provide additional fodder for an employee to make a claim against an employer for discrimination or some other employment law violation.
An effective PIP actually encompasses many of the best practices in Human Resources. The following elements are necessary for a PIP to actually support an employee’s improvement:
- Clear and factual statements about how an employee is failing to meet expectations
These statements should be objective and avoid personal attacks. They should also rely on real life examples of where an employee has failed to meet expectations. Those expectations can be directly related to the employee’s job performance (their output or productivity), their work ethic (such as poor attendance or tardiness), and their relationships with co-workers and supervisors.
Annual performance reviews can play a large role in developing the narrative of areas where the employee needs to improve. Employers are well served when they have real and constructive performance appraisal processes in place. These should include thoughtful and comprehensive performance evaluations that include information about positive and negative aspects of an employee’s job performance and contributions and should allow for the employee to have some input in the process.
- Clear and specific expectations for improvement
Once the employee has been put on notice of where they are failing to meet the mark, they need to be told what is expected of them going forward. For performance issues, it could be production quotas – you need to make x number of widgets or meet with x number of clients in a specific time frame. Or, for attitude issues, when attending staff meetings, you are expected to listen in the meeting and make positive contributions – you should not be on your cell phone or talking to your neighbors when people are presenting.
- The PIP should reference the employee’s job description when addressing both past performance issues and future performance expectations
Ideally, an employee’s job description should include specific statements regarding job duties and performance expectations. A properly written job description is a great tool when developing a PIP because it sets forth the duties and responsibilities of an employee and is something that the employee should be familiar with.
- The PIP must include continuous feedback for the employee
An effective performance improvement plan has built in check ins. These check ins are designed to demonstrate to the employee that the supervisor and the employer have a genuine desire to see the employee improve and are committed to making that happen. Most PIP are written for a three- to six-month period with monthly check ins. The check ins are intended to provide an opportunity for the employee to seek additional clarification or training regarding issues that have been identified and for the supervisor to provide specific and timely feedback to the employee as to whether they are meeting the expectations that have been set for them.
The duration of the PIP is open and flexible. An employer can go with a short time frame if the issues are easily identified and improvement can be shown in the shorter time period. If the issues are more complex or the investment in the employee is greater and it will be harder to replace the employee, a longer time frame can be used. The key is selecting a time frame is to ensure that the length of time used is sufficient to allow the employee to demonstrate the improvement sought. Too short of a time frame is a clear indication that the PIP is simply being used to move the employee to termination and there is no true intent to give the employee the opportunity to improve.
- The PIP should include training and other support for the employee
Another indication that an employer is committed to redeeming a marginal employee is a commitment to further training and education. This commitment should be memorialized in the PIP and the employee should be given the opportunity to identify areas where they believe they could benefit from additional training or support. Training can include shadowing an existing employee or attending outside training sessions on specific, job-related issues.
How the plan is presented to the employee also acts as a clear indication of the employer’s commitment to the employee and to achieving a positive outcome. When presenting an employee with a performance improvement plan, the manner in which the presentation is done will dictate whether the plan is viewed as a viable option for improvement or a foregone conclusion of termination. If too many people are involved in the meeting, then the employee will feel that they are under attack and they have no real opportunity to improve. The goal of the meeting to present the PIP is to ensure that the employee actually believes that the supervisor and the employer are committed to their success; the employee should not feel as though they are being set up for failure. It is for this reason that an employer must be careful when deciding who should be included in such a meeting.
During the meeting, you should have two people there – the Human Resources representative and the supervisor. The employee should be presented with the plan in an encouraging but direct fashion. The supervisor should lead the meeting and, if the relationship between the employee and the supervisor is strained or the discussions get heated during the meeting, the Human Resources representative should step in or interject to diffuse any conflicts that arise. The point of the plan is to provide clear feedback on where the employee is missing the mark, the expectations for the employee going forward, and the steps that will or should be taken by both parties to ensure that those expectations are met.
The discussion should focus on objective facts and not personal attacks on the employee or the supervisor. If the employee objects to the plan or otherwise refuses to sign the performance improvement plan, the employee must be told that the PIP is non-negotiable. During the conversation, it is appropriate to answer any questions the employee has about the plan or next steps, but it is important to not let the meeting become argumentative or overwhelmingly negative. If things start to go off the rails, then it is perfectly appropriate to stop the meeting and give the employee time to collect themselves and process the information in the plan. A follow up meeting must then be scheduled to finalize and implement the plan.
Areas where employers can be tripped up by PIPs include: the tone of the meeting, a failure by the supervisor to meet their obligations under the plan, or the lack of a real commitment to give the employee an opportunity to improve. While not required by law, a properly executed and implemented PIP can provide the employer with a great defense to any claims that an employee may make regarding wrongful termination. One the other hand, a poorly executed or half-hearted improvement plan can provide fodder for an employee to bring a claim against the employer. This is particularly true if the employer and the Human Resources representative allow the PIP meetings to get heated or to involve personal attacks.
myHRcounsel can assist you in developing performance improvement plans. General information regarding performance improvement plans is available in our HR Solutions Center. Specific questions regarding an employee’s job performance, performance evaluation tools, or performance improvement plans can be submitted to our Ask an Attorney portal. We are happy to work through these difficult employee issues with you in a way that minimizes your liability.