Why performance management goes wrong
Most managers either avoid difficult performance conversations for too long — hoping the problem resolves itself — or jump straight to formal action without the informal steps that protect them legally. Both approaches are expensive mistakes.
The good news: with the right process, you can address underperformance in a way that's fair to the employee, legally sound, and often genuinely resolves the problem.
Start with the right question: is this performance or conduct?
Before you do anything, be clear about what you're dealing with:
- Performance — the employee is trying but not meeting the standard required. Could be skill gap, lack of clarity, personal issues, or simply wrong fit for the role.
- Conduct — the employee knows what's expected and is choosing not to do it. This is a different process.
Confusing the two leads to the wrong process, which leads to tribunal risk.
The informal stage: where most issues should be resolved
Before any formal process, you must have a genuine informal stage. This means:
- A private conversation — specific, factual, non-accusatory. Not "you're not good enough" but "your reports have contained errors in the last three submissions — let's talk about what's getting in the way."
- Clear expectations set — write down what "good" looks like and what you expect to see change
- Agree a support plan — training, additional check-ins, a buddy, workload review
- Set a review timeline — "let's check in in four weeks"
- Document the conversation — an email to the employee summarising what was discussed is enough
Most performance issues, when caught early and handled this way, are resolved at the informal stage. Managers who skip this step not only risk legal exposure — they also miss the opportunity to actually fix the problem.
When informal isn't working: the formal process
If the informal stage hasn't produced improvement after a reasonable period (typically 4–8 weeks depending on severity), you move to the formal performance management process:
Step 1: Invite to a formal meeting
Written invitation at least 5 working days before the meeting. Must state: the purpose of the meeting, the right to be accompanied (by a colleague or trade union rep), and enclose any evidence you'll be referring to.
Step 2: Hold the meeting
Present the concerns, give the employee the opportunity to respond, explore any underlying reasons for the performance issues (health, personal circumstances, workplace factors). Take notes.
Step 3: Outcome and Performance Improvement Plan (PIP)
If you proceed, issue a formal written warning and a PIP. A good PIP includes:
- Specific, measurable targets
- Timescales (typically 4–12 weeks)
- Support offered
- Consequences if targets aren't met
- Review dates
The documentation principle
Whatever you do, document it. Not because you're building a case — but because clear records protect you, and they also help the employee understand exactly what's expected. If a case ever goes to tribunal, the employer who can demonstrate a fair, documented process almost always prevails. The employer who can't, rarely does.
When to get HR support
If the performance issue involves: potential underlying health conditions, a long-serving employee, someone who has previously raised a grievance, or anything that feels legally complex — get HR advice before you start the formal process. The cost of advice is trivial compared to the cost of getting it wrong.
Talk to us — we deal with performance management cases for small businesses every week.