Where an employee is not performing, it is important to follow a fair procedure in order to reduce the risk of a successful unfair dismissal claim. All employees with two or more years’ service have the right to claim unfair dismissal. This is a statutory right which is separate from any rights under the employment contract such as the right to notice of termination. Unfair dismissal compensation consists of a basic award (depending upon the employee's age and length of service) and a compensatory award, based on the employee's losses.
A fair performance procedure requires the employer to allow the employee a reasonable opportunity to improve before dismissing. You should explain to the relevant employee exactly how he or she is failing to meet the standards expected, set out clearly the improvements required and set a reasonable time period within which to achieve these improvements. If after this period, the employee’s performance has not sufficiently improved, you should have a further meeting to discuss performance, and again set out the specific improvements required and a reasonable further time period within which to achieve these improvements.
The employee should be made aware at all stages of the procedure that dismissal is a potential outcome of the procedure if his performance does not improve sufficiently. The employee also has the right to be accompanied by a colleague or trade union representative at these meetings.
A minimum disciplinary procedure (which will apply also in cases of dismissal for poor performance) will be implied into all contracts of employment. Under this procedure, employers will have to write to the employee setting out details of the employee conduct, and then hold a meeting with the employee before dismissing. The employee must have a right to appeal against the dismissal decision at an appeal hearing. Failure to comply with this procedure will entitle the employee to compensation.