By Julie M. Ryan

Often, an employer will know that an employee has been struggling to perform the job based on direct observations or complaints from coworkers or customers. An employee’s insufficient job performance can have negative impacts on your business, from burdening coworkers with an increased workload and increased costs, to work not getting completed at all and possible safety or health issues when company policies are not being followed.

A performance improvement plan (“PIP”) is a tool an employer can use to facilitate clear communication about an employee’s job performance issues and memorialize a plan for what the employee must do to get back on track. The main purpose of a PIP is to help the employee, not punish. At the same time, if the employer ultimately decides to terminate the employee, the PIP documentation may be used to support that decision.

Here are some things for employers to consider relating to PIPs:

  1. Check Company Policies: After investigating an incident, check your company’s handbook or other policies to determine whether using a PIP is appropriate for the situation. Subject to those policies and the facts of the incident, a one-time incident may not be cause, by itself, to warrant implementing a PIP. Part of your considerations may include whether the employee received clear expectations or training to know better to avoid the issue. In that instance, you may consider documenting that incident and applying some other form of discipline, such as a written warning or suspension. Sometimes progressive discipline is not appropriate, though. There can be one-time incidents that are so egregious or otherwise which warrant immediate termination based on company policy and the facts of the incident. When company policy allows, a PIP can be used for situations that fall somewhere in between those two scenarios. A PIP is most commonly used as the last step in a progressive discipline process before termination, if any.
  2. Prepare the PIP:
    • A properly drafted PIP will identify general information such as the employee’s name and job title, his or her supervisor’s name, a space to write in the date for when the company representative (supervisor and/or human resources) will meet with the employee to review the PIP, and spaces for that company representative and the employee to each sign and date when they have each reviewed and acknowledged the PIP.
    • The PIP will identify what standards of performance are being reviewed. For example, is the employee having issues with productivity, quality of work, teamwork, timeliness, attendance, conduct, etc.?
    • As relevant to the identified standard of performance under review, the PIP should then describe what an employee must do to satisfactorily perform that standard.
    • The PIP should describe how the employee has not been satisfactorily meeting that standard of performance. Use examples of incidents in which the employee failed to meet that standard and explain why.
    • Having identified the current performance issue areas and the required standard for those areas, the next step is to identify the improvement plan. These are the things the employee must do to correct the job performance issue. For the improvement plan, state what is expected of the employee, how the task must be done, and the timeframe for how long the plan will be in place (e.g., 30, 60, or 90 days).
    • If the employee is employed by the business “at-will”, the PIP should include language to inform the employee that nothing in the PIP changes the “at-will” nature of employment.
    •Be specific and concise throughout the PIP.
  1. Meet with Employee: The company representative’s meeting with the employee should be as soon as practicable after the investigation of the incident has been completed and the draft PIP has been prepared. The company representative should go through the PIP with the employee and ensure that the employee understands the issues and the plan. Allow the employee to offer suggestions of how they believe they can improve their performance and, if appropriate considering the business needs and duties of the position, you may revise the PIP accordingly. Both the representative and employee should sign and date the acknowledgment on the PIP.
  2. Follow-up: Plan recurring meetings with the employee every one to four weeks after the initial meeting to review the employee’s progress with implementing the improvement plan. The PIP should include an area to document the periodic review meetings. If the employee successfully completes the PIP plan, the PIP should document the date that was accomplished. The PIP and all documents relating to the PIP should be kept in the employee’s personnel file.

For more information, please contact Julie M. Ryan at [email protected] or another one of AKC’s Employment Law attorneys at 402.392.1250