This blog (originally published in March 2013) is being re-posted following our WordPress account being hacked, resulting in the loss of all our blogs prior to June 2017.
These are the final tweets in this series of 50, and deal with how to short circuit a performance procedure where the parties are prepared to agree to a mutually acceptable alternative.
Since many people do not want a dismissal for poor performance on their record, they often leave before any procedure is complete, but in some instances, particularly in small organisations, it may be in the interests of the organisation to encourage them to leave more quickly.
In legal terms this is not risk free, so, ‘don’t try this at home’ without HR or other appropriate professional assistance!
UK law currently provides for disputes between employers and their staff to be resolved using a ‘compromise agreement’, and at the present time (Spring 2013) the Government is proposing to introduce new ‘settlement agreements’ which will be simpler and easier to use.
They will be ideal for situations where an employment relationship is not working out due to conduct or performance, but will not be suitable for more complex issues, for instance, where there are discrimination or ‘whistleblowing’ issues involved.
We have seen earlier in this series that everyone has the right not to be unfairly dismissed providing they have been employed for the ‘qualifying period’ (two years or more if they started work with you on or after 6th April 2012).
Put simply, this means that you must have a fair reason for dismissing someone (and poor performance usually is regarded as fair) and you must behave reasonably, i.e. follow a fair procedure, such as is outlined in Parts 2 and 3 of this series, when you dismiss them.
There are circumstances where the length of time this will take is unacceptable from a business point of view, and circumstances where the procedure will be undesirable from the employee’s perspective.
For instance, an employee with long and loyal service may no longer be performing adequately, and it may be more appropriate to find a solution that enables them to leave with some dignity and without having to be put through an elongated process.
It’s only really safe to do this when you are contemplating dismissing someone, and this may mean that it is not worth doing. If the lack of performance is genuine and you have got as far as Stage 3 in our procedure, there may be little point in not simply completing the process.
So, in many instances, employers want to offer staff an alternative route out of the organisation at an earlier stage. This may not be quite so safe, but the fact there is not a lot of case law on this topic, suggests that it usually works!
Here’s a series of steps which might lead to an alternative mutually acceptable solution, but remember, don’t do this without appropriate advice from a HR professional or lawyer.
Tweet 37/50: Discuss your performance concerns with the employee and tell them that you intend to start a disciplinary process which would start with a hearing and could lead to them getting a warning.
Tweet 38/50: They will be given the opportunity to improve, but if they cannot improve after being warned, it may lead to their dismissal.
Tweet 39/50: Indicate that if they would prefer to have a ‘without prejudice’ (wp) conversation regarding a mutually acceptable alternative termination arrangement, then you would be happy to have that conversation.
Tweet 40/50: Give them time to think about the situation, pressurising them may lead to a constructive dismissal claim.
Tweet 41/50: If they agree to proceed on a wp basis there and then, you can proceed but take the precaution of having another senior person present to ensure that there is no subsequent argument as to the nature and content of the discussion.
Tweet 42/50: Emphasise that you would be happy to give them the opportunity to improve, but if they don’t think they can, or they don’t want to go through a series of warnings, you are happy to propose an alternative.
Tweet 43/50: Indicate that an alternative approach would involve them signing a compromise agreement. This would prevent them from bring claims against the organisation in the future, but in return for this they would receive an ex gratia payment.
Ex gratia payments are not always made, but are usual. There may be some circumstances where it is simply agreed that the individual departs with pay in lieu of notice. This may be the case, for instance, where the person’s performance is bordering on negligence, and they are fortunate to be given the opportunity to leave without a dismissal for poor performance on their record.
Tweet 44/50: Make a proposal with regard to the ex gratia payment. You may have some negotiation about this and other issues such as notice payments and outstanding holidays etc. Any settlement above their contractual rights would normally be tax free for the first £30k.
Tweet 45/50: If they do not want to go down this route immediately, you should proceed with the invitation to the disciplinary hearing, but verbally indicate that the offer of a wp discussion (or the offer if you have got as far as making one) is on the table for a few days.
Tweet 46/50: If the offer is not accepted, have your hearing and if justified issue a warning (or dismissal if you are at that stage) in line with your contract/staff handbook, or follow the procedure outlined in Parts 2 and 3 of this series.
Tweet 47/50: There is nothing to stop you leaving the door open on the wp conversation, regardless of the fact that you are commencing with the disciplinary/performance procedure. But don’t leave it indefinitely; they’ll be little to gain from reaching an agreement after you have expended your time and energy on a fair process – assuming that there are not other issues such as discrimination or ‘automatically unfair dismissal’ involved.
Tweet 48/50: As ever, you should draft written notes of any meetings, and mark all correspondence based on the wp discussions as ‘Without Prejudice and Subject to Contract’.
Tweet 49/50: If they do agree to a deal, you will need to confirm the details in writing, and arrange for a compromise agreement to be sent to them.
Tweet 50/50: You will have your own, and it is normal to make a contribution to their, legal costs. Their solicitor may well come back to you on details of the proposed agreement, but after agreement is reached it will be for you (or your representative) to finalise the compromise agreement and send it to the employee for signature.
Tweet 44/50 may take a few meetings, and it is quite normal in these circumstances to agree a mutually acceptable termination date, and for the person to leave before the agreement is signed.
In this series of 50 tweets we have suggested informal, formal and alternative approaches to dealing with a poor performer.
The various steps should be seen as a model/sample approach, which cannot in any way be taken as a substitute for seeking professional advice on any particular situation.
The approach is offered as a way of encouraging the tackling of performance problems in the workplace, and to give managers confidence to initiate conversations about their concerns.
Above all, it should be remembered that prevention is better than cure, but poor performance can be an infectious disease that should not be allowed to spread!
Ken Allison | 19 September 2017 | Paradigm Partners | www.paradigmpartners.co.uk
Ken Allison is an engaging trainer and speaker who manages to make his topics, on handling employment law related people issues and other HR stuff, highly interactive, challenging, entertaining, and above all, relevant to the 21st Century executive. Ken uses his understanding of managing businesses to show managers what they ‘can do’ rather than what they ‘cannot do’.
Through his firm’s ‘ExecutiveHR’ service, Ken also provides telephone based support services to businesses throughout the UK.
This blog is not a substitute for taking legal advice!