Why Performance Management Needs to Become Feedback for Management

Performance Management, Defined

Performance management is when an employer uses strategies to improve work performance, increase the quality of an employee’s work, or increase their output. It is a tool used to help employees work in alignment with the objectives of the employer and work more efficiently. In practical terms, when an employee is placed under performance management, there is already a previous history of poor performance or under performance by the employee. 

There is poor performance when an employee does not produce the output expected from or agreed upon between them and the employer. Under performance can mean that the employee is not performing work that conforms to the standard of the employer. This can also include failure of the employee to follow workplace rules or procedures that affects the output of the employee. Performance management, thus, prevents further or continued under performance and poor performance by the employee. 

What Employers Do When Employees Under Perform or Poorly Perform

Employers usually set quotas or key performance indicators and they use measurements and standards that assess and rate the performance of employees as well as their strengths and weaknesses. The employers usually have a period called a performance review where supervisors and managers meet to assess the performance of individual employees. Performance reviews are usually scheduled annually. 

These performance ratings and reviews are helpful to the employer because employers gain insight into what further training employees need and what skills they need to gain. Employers usually meet with employees to inform them of the results of their performance review. 

Once the performance review shows that the employee is under performing or poorly performing, the employer can call a meeting or give the employee a notice listing in detail the issues that point to under performance. There must be evidence to substantiate the poor performance rating. 

At this meeting, the employee can and should bring a support person. They must be willing to discuss with the employer the issues and concerns raised about their performance.  Concrete steps to increase performance must be suggested and agreed upon, and time should be given to the employee to improve. These details are usually contained in what is referred to as a Performance Improvement Plan (PIP) or Performance Management Plan (PMP). The plan does not have to be in any particular format but the employer must set clear expectations from the employee as to how the employee can improve.

Why Employers Should View Performance Management as Essential Feedback?

A poor performance rating does not always mean that the employee is not suitable for the job they were hired to do. Often, there are factors or circumstances in the work environment that contribute to the poor performance. 

There may be issues of miscommunication, confusion as to policy or procedure, or differences in personality and management styles. In any case, the poor performance rating of any employee must be approached by the employer as vital feedback from employees on their job satisfaction, job competence, and the general working environment.

Employers in Australia can learn from their employees. If the poor performance is due to poor communication, there may be a need to improve the communication infrastructure. If the poor performance is due to confusion regarding policy or procedure, these may be reviewed or explained more fully to employees. Employees may be re-trained in various procedures to increase employees’ confidence in following policies or procedures. If there are problems arising from personality differences or management styles, then complaints of workplace bullying and harassment may be prevented if personality and management clashes can be threshed out. 

Warnings When Employees Do Not Improve Despite a PIP

No employer can be forced to keep in its employ a person who does not do the work they were engaged to perform. However, the employer cannot immediately terminate the employment of the under performing employee. 

The employer must give the employee a warning that they are in danger of losing their job because of their under performance or poor performance. In the case example discussed below, the Fair Work Commission even required that the under performing employee be given notice that the warnings will be issued in addition to the meetings with the managers. 

The warning must be in writing; it must alert the  employee to their poor performance and specifically enumerate the ways that the employee has under performed. The warning must include a statement that failure to improve their work performance will cause the employee to be disciplined and may be terminated. The warning may also state that if a similar under performance or poor performance by the employee occurs, the employee will be terminated from employment. Finally, the under performing employee must be given the opportunity to respond to the written warning given. 

In the case where  the employer decides, after due deliberation, to terminate the employee due to the employee’s failure to improve their performance despite warnings, the employer must give the employee the opportunity to explain why their employment should not be terminated.  

Case Example

In the case of Andre McCormick v Colliers International (SA) Pty Ltd T/A Colliers International [2019] FWC 1517, a building manager was hired to manage buildings that were managed by a real property management company.  After working for two years, no concerns about the building manager’s performance were raised. The building manager began having personality differences with his line manager and he made a complaint against the line manager for bullying. While the investigation of the allegations were under way, the building manager was given a different line manager to report to. 

At the end of 2017, a tenant in one of the buildings managed by the building manager complained about the building manager. The building manager was given a first warning and was advised to improve his communication with tenants and supervisors. The building manager was placed on a performance management plan and given a month to improve his performance. A new performance review was scheduled. In the meantime, the employer concluded that the complaint made by the building manager for bullying was not substantiated. 

The building manager passed the performance review and he was removed from performance management. However, right after this, there was an electrical shutdown that affected some properties managed by the employer. When the building manager received a call from one of the affected tenants, the building manager immediately sent an urgent request for an electrician.  The building manager failed to send an email to his line supervisor informing them of the electrical shutdown. After the building manager requested for an urgent work order for an electrician, and during the time that the electrician was working, the building manager refused to answer any more calls from the tenants because he had no update for them about the issue. 

The building manager was called to the second performance review and the issue of failing to communicate with his supervisor and with the tenants was again raised. At this point, the building manager was fearing for his job, however, he was not given any indication that he would be terminated. He was scheduled for a new performance appraisal meeting on 14 August.

And then, during the weekend that followed, there was a fire in a dumpster outside one of the buildings. The fire fighters were called to the scene and they attended to the matter. The fire services informed the building’s fire marshal but not the building manager. The fire marshal of the building informed the employer but did not inform the building manager.  

It was on Monday, when the building manager was at the office that he found out about the fire. The second performance review which was previously scheduled for 14 August was advanced to 9 August. When he left the office that day, he overheard line managers talking and he heard words to the effect that the issue could not be put off anymore. 

Stressed out that he had been kept outside the loop, and afraid that he was going to be terminated from employment, he asked that the meeting on 9 August be postponed to the previously scheduled meeting on 14 August.  He informed his line manager and the HR that he was taking a stress leave and that he was going to see his doctor. He sent them medical certificates from his doctor. The employer refused to reschedule the performance appraisal meeting back to 14 August. The line manager and HR Manager decided that the meeting take place even in the absence of the building manager. 

At that meeting on 9 August the building manager was terminated for failure of duty to inform the employer of the fire incident and for failing and refusing to attend the performance review meeting on 9 August. 

The building manager lodged a complaint for unfair dismissal. The Fair Work Commission found that there was no evidence that the fire service or the fire marshal informed the building manager of the fire. Not having been informed, he could not have breached the duty to escalate the fire incident to his line supervisor. 

The FWC concluded that the building manager was unfairly dismissed because there was no valid reason for his dismissal. The performance deficiencies warranted counselling and warning but it was not a valid reason to dismiss the building manager even when all the performance issues were treated together. 

The FWC also found that an overly negative view of the building manager’s work performance was made in the same period that the building manager lodged a complaint for bullying against a former line manager. This coloured the assessments made by subsequent line managers. 

The building manager could no longer be reinstated as the employment relationship had irretrievably broken down. More importantly, the building manager stated specifically that he lodged the complaint for unfair dismissal to redress the unfairness of his dismissal and not for any desire for financial gain. The building manager was awarded one month’s pay in lieu of notice and six-months’ compensation computed at $8,615.60.  

Unfair Dismissal Western Australia

Is it considered unfair dismissal in Western Australia if a teacher is dismissed automatically once a complaint for child abuse has been lodged against the teacher?

The State School Teachers’ Union of Western Australia sought a ruling from the Fair Work Commission on whether it may be considered an instance of “unfair dismissal” when a principal was deemed automatically dismissed from employment once a complaint for child abuse had been lodged against the principal.

In March 2018, the Child Protection Department of Western Australia issued an interim notice that sexual abuse charges will be lodged against the principal for sexually abusing a child 10 years before. Two days after receiving the notice, the Executive Director of the Department of Education of Western Australia wrote to the principal informing him that his employment was terminated because under Section 22 of the Child Protection (Working With Children) Act, the Department of Education cannot continue to employ the principal in a child-related work after it was made aware of the issuance of a negative notice. The letter of the Director General stated that the interim notice is a repudiation of the contract of employment and as such, no notice need be given or paid to him.

It must be noted that while the principal has been formally charged in court, the matter has yet to be tried and decided by the court. The principal and his union seek payment of notice. Section 22 of the Working With Children Act only forbids the principal from working with children. It does not force the Department of Education to dismiss or summarily dismiss the principal. At its option the Department of Education may suspend the principal or even assign the principal to other work not related to working directly with children.

The Director General of Western Australia’s Department of Education has denied that she has terminated the employment of the principal or that she has summarily dismissed him. What happened was that the filing of the negative notice against the principal amounts to a repudiation by the principal of the contract of employment. Thus, the Department of Education is not liable to pay the principal any notice.

This line of argument has been used in a similar case before. In 2017, a Catholic school sacked a teacher who had been charged by a student with indecent assault. The Catholic school said that with the filing of the criminal charges against the teacher, she had automatically lost her clearance to work with children and this frustrated her employment. When the criminal charges against her were dismissed, she immediately filed an unfair dismissal charge against the Catholic school. She was reinstated and compensated for lost pay.

First Shared in:  https://employmentlawyersperthblog.wordpress.com/2019/04/02/unfair-dismissal-western-australia/

Unfair Dismissal WA says: Failing to report use of prescription drugs is not serious misconduct

A company that manages transportation services had a policy requiring its employees to disclose information about prescription drugs they were taking. The company hired a compliance officer to administer drug and alcohol tests on its employees that drove or operated public transportation vehicles.

The compliance officer had not disclosed that he was taking a non-steroidal anti-inflammatory drug called Neurofen Plus. He failed to tick of a box in an employment form and he failed to name the drug on his employment form called a medical declaration. He had been working for the transportation management company for four years.

One day, the superior of the compliance officer advised him that an audit was to be conducted. He was informed that the key performance indicators were low. The superior then told the compliance officer to self-administer a saliva test on himself.

The compliance officer thought that he was doing a demonstration of the tests, he did not think that he was going to be tested. He made a point of the saliva testing being unreliable. When he administered the saliva test, he quickly threw away the result, for he did not understand that he was being tested himself. He also pointed out that self-administered tests are not regular or acceptable practice and his superior was not a licensed tested who can interpret results. He also informed the superior that self-administered tests will not count as part of KPIs. His superior took the test packet that the compliance officer threw away and it showed that the compliance officer tested positive for opiates, an active ingredient in Neurofen Plus.

He was then stood down for failing to inform his employer that he was taking the drug, for failing to file a medical declaration, and for throwing away the test packet to hide the positive result for opiates and deceive his employer. However, when the decision to dismiss him was made, the HR Manager wrote in her report that the performance of the compliance officer was subpar, he had been placed on performance management before, he had falsified his timesheet, he had left the workplace without authorization, he lacked willingness to comply with policies and procedures, he refused to acknowledge wrongdoing or that improvement was required, and he had shown no remorse for his actions. On his part, the compliance officer explained that his failure to abide by the no drugs policy of his employer was not brought about by his refusal to abide by the policy – it was brought about by his erroneous thinking that the drug ban did not apply to him because he had a desk job and did not operate a vehicle. He honestly thought that as he did not operate a vehicle as part of his employment, the policy of disclosure did not apply to him as well. He was still dismissed for serious misconduct.

The Fair Work Commission found unfair dismissal of the compliance officer. First, his failure to comply with policy was not deliberate but only because of his erroneous interpretation of the policy. Second, he was not dismissed for having taken drugs, he was dismissed for failing to disclose the fact that he was taking drugs and filing a medical declaration. Third, the allegation that he had thrown away the test packet to hide the positive result was not proved. These acts hardly constitute serious misconduct.

The FWC found that the other allegations against the compliance officer showed a troubling pattern. Some of the allegations were for actions allegedly committed two years before the dismissal. And in finally dismissing the compliance officer, the employer relied on the allegations of falsifying the time sheets and the breaches of the drug policy. This showed that the HR Manager overreached in finding reasons to dismiss the compliance officer, thus, showing unreasonableness in the process of the dismissal.

Lastly, the FWC found that the dismissal was harsh as his role was of a specialist and he has had extreme difficulty in obtaining other employment in the same field. He could no longer afford rent and he had relinquished his home and his car has been repossessed. His claim for reinstatement was denied as the relations between him and his employer have become strained. He was awarded the amount of $17,795.08 in lieu of reinstatement.

Were You Forced to Resign Because of Your Employer's Behaviour?

An employee is dismissed when he or she is informed of the dismissal. However, in certain cases, an employee may resign because of some act or behaviour of the employer that caused the employee distress. Although the termination of the employee was through resignation of the employee, the law still considers it a dismissal at the initiative of the employer because the resignation was "forced" by altered conditions at work.

When the resignation was made under emotional distress and with the employee not even knowing why she was being investigated for misconduct, the employer cannot reasonably accept the resignation as voluntary. Thus, if the employee were to rescind or take back her resignation, the employer cannot claim that it had accepted the resignation. This is illustrated by the case of Bupa Aged Care Australia Pty Ltd T/A Bupa Aged Care Mosman v Shahin Tavassoli [2018] FWC 1074 (9 March 2018).

An Assistant Nurse was employed at an Aged Care facility. She was a 55-year old refugee who had limited English skills. Whilst at work on 13 November 2016, a co-employee secretly recorded her on his mobile phone. The video showed the Assistant Nurse bantering with a resident. The video went on to show that the Assistant Nurse conversed with another nurse where they laughed at the death of two residents which occurred just before their shift. It also showed that while residents rang for them, the Assistant Nurses continued drinking tea, and ignored the residents' calls.

She was called into a meeting a couple of days later. She was not told what was wrong or if she were in trouble. She was visibly distressed and crying. She was escorted off the premises. While she sat on the footpath outside her workplace, she remembered that she had been offered a six-pack of beer by a resident and she could have been accused of stealing it. She feared being terminated for stealing. She drafted a resignation letter with the help of a co-employee.

She went back inside her workplace and handed in her resignation. Her boss did not accept the resignation letter. She was then called to another meeting to investigate the allegations of misconduct against her which would be conducted a few hours later. She was distressed and crying. Before the meeting commenced, she told her boss that she did not want to participate in the investigation. Her boss told her that if she put in her resignation letter that her resignation was effective after 4 weeks then she would not need to participate in the investigation.

The next day, the assistant nurse received a letter confirming her resignation. She went back to work and wanted to take back her resignation. Her boss told her that he had accepted her resignation and she was no longer an employee. She filed an unfair dismissal claim. She was not shown the video and she was not provided with a letter telling her what misconduct she committed.

Although the employer did not do any overt act of dismissal, the resignation of the employee was forced because of the behaviour of the employer, thus, the termination of the employment can still be considered as having been done at the initiative of the employer.

The resignation of the assistant nurse was made in the "heat of the moment" when she thought she was accused of having stolen beer. At the meeting, she was upset and so the employer could not have reasonably inferred from the circumstances that the employee's resignation was voluntary. The employee was clearly in emotional distress at that time. Thus, her resignation was legally ineffective. The assistant nurse was reinstated to her former position and awarded back pay.

Has your employer acted to frustrate your contract of employment? Were you forced to resign because of your employer's behaviour? Do you want to know if your resignation can be considered as "forced" and thus, the termination of your employer could be considered as a "constructive dismissal?" If you wish to know more, call and speak with any of the Unfair Dismissal lawyers at MKI Legal. We can help you make sense of this.

Constructive Dismissal Advice

Can a small business be exempt from unfair dismissal? Unfair Dismissal Lawyers weigh the case of the Manager of a Flight Attendants’ Union who sued for unfair dismissal.

The Flight Attendants’ Association is a nationwide union of flight attendants. It had dismissed a union development manager for volunteering as campaign administrator for the division secretary when the secretary ran for the national position. After she was dismissed, she stood as the support person of the division secretary during the investigation of the allegations of gross neglect of duty, gross misbehaviour and breach of fiduciary duty. After that, the FAA dismissed the secretary for allegedly supplementing his base pay with payments from a bank of leave days of the members of the FAA.

When they filed claims for unfair dismissal, the FAA raised the issue that the Fair Work Commission had no jurisdiction to hear the claims for unfair dismissal because the FAA was an employer of fewer than fifteen employees. The union claimed that the Small Business Fair Dismissal Code and not the Fair Work Act should apply to them.

The division secretary and the union development manager asserted that the elected officials of the union who were elected by the members of the union should be counted as employees. For if the elected officers of the FAA were counted as employees, the employees of the FAA would exceed 15 and the Fair Work Act will apply.

In deciding the question of whether the elected officials should be considered as belonging to the legal definition of “employees” will also include a determination if they engaged in work in any form and if their salary arrangements fall under the definition of “wages”.

Under the Small Business Dismissal Code, an employer may dismiss an employee without notice or warning when there are reasonable grounds to believe that the employee committed severe misconduct such as theft, fraud, violence and serious breaches of occupational and health safety procedures. The employer must file a complaint with the police for the theft, or fraud. For other causes of dismissal, the employer must give the employee notice that they are in danger of being dismissed. The employer must also provide the employee with the opportunity to respond to the warning.

The employees of a small business must file a claim for unfair dismissal if the employer failed to comply with these requirements. They can file a claim with Fair Work Commission and not Federal Court. In effect, the jurisdictional question raised by the FAA is meant to work as a dismissal of the unjust dismissal filed by the division secretary and the union development manager.

Are you a small business owner? Do you need advice on unfair dismissals? Do you need Unfair Dismissal Lawyers to write up a policy or protocol for dismissals for your small business? Call us at MKI Legal today.