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Performance Management – Avoid Following in this Employer’s Footsteps

An employer who had been addressing the poor performance of a manager for a considerable time fell at the last hurdle when they dismissed him after he had finally improved and met his targets.

The case of Chapman v Tesco Stores Ltd shows that performance management can be tricky for employers of all sizes. That’s not to say it’s an issue that employers should shy away from but that it’s important for managers to know how to deal with such matters fairly and appropriately. As this case shows, employees who have two years’ service or more can complain to an employment tribunal if they feel they have been unfairly dismissed.

The Facts of the Case

The employee had worked at Tesco since 2006, he had recently been appointed as night manager responsible for fresh foods. At an annual performance management meeting it was found he had failed to meet the required standards in a number of areas – this resulted in him being scored as ‘missed’.  In accordance with company policy his poor performance was initially dealt with informally, when his performance didn’t improve a formal performance management process was commenced.

He was set targets and given timescales to improve in a number of areas. However, he continued to fail to meet these targets. This was investigated and a formal performance meeting was held after which he was given a written warning and targets and timescales were set again. The same process was followed when he still did not improve sufficiently, and he was given a final written warning. Following this the employee’s performance was again identified as ‘missed’ because despite showing improvement in some areas he still hadn’t completed his e-learning, delivered new starter training or addressed the performance of his team.  The employee’s performance was discussed and his manager advised him that he would be passing the case forward for a formal hearing. The next day the employee raised a grievance against his manager for treating him differently to other managers, singling him out and belittling and bullying him. The grievance was investigated by an independent manager and a grievance process followed. The grievance was not upheld.

Shortly after this the employee was invited to attend a formal performance review hearing. It was said that, despite having time and support to improve his performance, the employee had not progressed sufficiently as follows: his role pack was not complete; his new starter training was not complete; and the productivity of his team had not improved.

At this hearing the employee insisted that by then he had completed the steps that were required by him and that he was now a ‘target met’ performer. He accepted that his performance had been that of a ‘missed’ performer for much of the process but that he had now met his targets. Whilst the manager holding the meeting challenged the employee on why it had taken him so long to make significant steps to meet his targets she did not challenge or explore his assertions that he had now completed them all. She gave no express consideration to the employee’s management of his team’s performance and there was no suggestion that it remained inadequate. After adjourning briefly to consider her decision, the manager dismissed the employee. Her reasons for the dismissal included that his performance was ‘still a ‘missed’. There is evidence that next steps have not been met throughout the process.’ The employee appealed on the grounds that dismissal was too severe when he had completed what was required of him. He also appealed against the dismissal of his grievance. Neither appeal as successful.

The employee complained to an employment tribunal that he had been unfairly dismissed and the tribunal agreed. Whilst the reason for the dismissal was found to be the employee’s capability (his poor performance) and that he wasn’t being bullied out of the business by his manager as his grievance alleged, the dismissal was nevertheless still unfair.

It was held that:

  • No reasonable employer, failing to challenge the employee’s assertion that he had completed his next steps and failing to challenge the performance management of his team, could nevertheless reasonably conclude that the employee had not by the time of the hearing done all that was asked of him.
  • Even if the dismissing manager had had in mind that the employee had failed to complete his next steps by the time of his final performance investigation meeting, she did not say so in the dismissal letter. In any event she would have been acting procedurally in a way no reasonable employer could have fairly acted as in the letter inviting the employee to his formal performance hearing, he was told that his manager would continue to work with him to support his improvement. No reasonable employer could, in those circumstances, have ignored the employee’s improvement in the intervening time.

Kingfisher’s Advice

It’s important to ensure that performance issues are managed appropriately and fairly. Whilst managing poorly performing employees can be frustrating at times it should be remembered that the purpose of a performance management process is to support an employee to improve. For employees who have two years’ service or more dismissal should only be considered where it is appropriate in the circumstances and after following a fair and reasonable performance management process.

If you have an employee in your organisation whose performance you are concerned about, you should contact Kingfisher Professional Service Ltd for advice on the facts of your case, irrespective of how long an employee has worked for you. Identifying performance issues early and taking prompt and appropriate action to address them can prevent the situation from escalating.

If you would like advice on an employment law matter, please do not hesitate to contact Kingfisher Professional Services Ltd as we are happy to help.