Find out the key points on performance management and why they are important for your business.

1. Performance Matters?
Tuesday 7 October 2014
Emma Peacock
Kaajal Nathwani

2. Introduction and agenda
• Why managing underperformance matters?
• Fundamental legal principles
• Principles & processes
• Performance management tools
• “Red flags” & case study
• Without Prejudice discussions / protected
conversations
• Psychometric testing
• Questions

3. Why managing underperformance
matters?
• Xpert HR survey published in July 2013:
• 9 out of 10 organisations considered underperformance to
be an issue
• Only 20% of organisations had made the development of
managers’ performance conversation skills mandatory
• 45% of employers considered that the majority of
managers were not competent to deal with
underperformance

4. Why managing underperformance
matters?
• ACAS – Performance management should “continuously improve
the performance of individuals and that of the business”.
• The purpose of performance management is to retain and improve
staff – it is not a shortcut to dismissal.
• Allows for transparent communication providing an effective way
for employees to voice views and concerns and managers who
facilitate and empower their staff.
• Engaged employees lead to increased profit; morale; and retention.
• Evidence of performance management is also vital in defending
claims, e.g. unfair dismissal claims for redundancy, or
discrimination.

5. Why Managing Underperformance
Matters
• Case studies:
• BBC – wasting £80m per year through poor staff
management
• Microsoft – forced ranking system pitched staff against
each other

6. Fundamental principles of performance
management
• Employees should be clear as to the requirements of their
role and the standards expected of them.
• An individual should have a clear understanding of where
they fit into the business.
• Appraisals should be used to motivate staff and highlight
areas for improvement making a more productive and
structured workplace.
• Managers should be fully trained to manage performance
effectively: support and coaching; difficult conversations and
disciplinary action.

7. 7
Feedback to Win!
HAT were the actions and behaviours?
What was done & said – and how?
MPACT on the business, client,
individual, relationship?
EXT
What needs to happen to
WIN bigger next time?
Keep/ Stop/ Start? Learn?
Do?

8. 8
Observations and facts versus
inference
OBSERVATIONS Things that you see 
FACTS
INFERENCES
Things you know
based on data
  Conclusions, usually
about someone’s
personality, intent, etc.

9. Identifying and assessing underperformance
CONDUCT
“CAN’T” “WON’T”
UNDERPERFORMANC
E
CAPABILITY
(RELATIVE OR ABSOLUTE)
Need to assess
HEALTH MISCONDUCT
GROSS
MISCONDUCT
Need to identify
What is the
issue?

10. Performance management tools
• “An employer should be very slow to dismiss upon the grounds that the
employee is incapable of performing the work which he is employed to do
without first telling the employee of the respects in which he is failing to do his
job adequately, warning him of the possibility or likelihood of dismissal on this
ground, and giving him an opportunity to improve his performance.” - James v
Waltham Holy Cross UDC [1973] IRLR 202
• Set clear standards from the outset and keep them under review

11. Performance management tools
• Making use of probationary periods:
New recruits
• assess the employees' suitability for the role
• limited exposure to claims
• terminable on short notice
• probationary period and right to extend probationary period clearly
communicated
• reasonable appraisal process
Existing employees
• those promoted to a new role
• probationary period clearly communicated and consideration re what if
employee does not pass probationary period
• reasonable appraisal process

12. Performance management tools
• Appraisals:
• Invaluable in motivating staff
• Appraisals should be conducted honestly, reflect true performance
and identify training needs and performance targets
• Important evidence – it is extremely difficult for an employer to claim
he acted fairly if he fails to carry out a proper appraisal of the
employee’s performance
• The need to appraise and give guidance to probationary employees
has been recognised as a specific contractual obligation - White v
London Transport Executive [1981] IRLR 261.

13. Performance management tools
4 key steps:
1. Careful appraisal of performance and discuss criticisms
2. Warn employee of consequences of not improving
3. Give employee a reasonable chance to improve
4. Have you fulfilled responsibility to create conditions which enable
employee to carry out duties satisfactorily (e.g. adequate support and
training)

14. Performance management tools
• Training and support.
• Financial incentives/penalties – and risks e.g. performance bonus to
reward high performers / curtailing pay rises or bonuses for
underperformers.
• Non-financial rewards for good performance – e.g. recognition, status.

15. Case study

16. The Story.......
• Norma is an IT support analyst with Banking
Word Plc, an investment bank.
• Norma is in her mid 60s, she is one of the
company's longest-serving employees and has
a clean disciplinary record.

17. The Story.......
• David, is Norma’s team leader and has recently joined the
company. He arranges a meeting with the HR Manager as
he has some issues with Norma’s performance following
complaints from colleagues that she does not pull her
weight.
• David is of the view that Norma’s poor performance has
been a problem for some time but the previous team
leader did nothing about it. There is no documentation in
support of this.

18. Questions
1. Can David initiate disciplinary action for
poor performance against Norma?
2. What is the first step?
3. What is a reasonable investigation?
4. What happens after the investigation?
5. What mitigating factors should David
consider?

19. Questions
• 6. If Norma’s poor performance is due to
capability what should David do?
• 7. What can the employer do if Norma’s
performance does not improve?
• 8. Based on the facts what else might be
relevant?

20. Case study

21. Red flags
• A single act of incompetence:
• In most situations employers are expected to investigate and consider
offering support to facilitate improvement before they can reasonably
contemplate dismissal
• An employer is entitled to protect the interests of his business: “Cases
can arise in which the inadequacy of the performance is so extreme
that there must be an irredeemable incapability. The opportunity of
improvement may be of no benefit to the employee and may
constitute an unfair burden on the business.
• Some failures can warrant dismissal. A failure by a senior employee to
comply with financial reporting requirements warranted instant
dismissal in an established case.

22. Red flags
• “Can’t do vs. won’t do”
If you continue to offer training and support when in fact the employee
has received reasonable training and support and their continued failure
to perform can constitute misconduct.
•Incapable of changing – A warning may be unnecessary for someone
who is ‘constitutionally unable to alter their ways’
•Unwilling to change –In some cases it may be reasonable to dismiss at
once, especially if someone refuses to follow prescribed processes.

23. Red flags
• Dealing with an employee whose behaviour improves until after
warnings have expired
• Where a pattern emerges or there is evidence of abuse this should be
borne in mind when deciding the warning period
• Longer warning periods of 6 or 12 months may be appropriate
• Employee should be told that there needs to be sustained
improvement even after the warning expires

24. Red flags
• What is a reasonable opportunity to improve will depend on the particular
circumstances:
• Consider length of service, status, past performance
• Senior employees – each case depends on its own circumstances but
the ET is more likely to find that a senior employee would have been
aware from the circumstances that his role was a risk and a specific
warning was not required.

25. Red flags
• Discrimination issues:
• Avoid disparity of treatment
• Maintain a fair and consistent approach in line with internal policy and
ACAS guidance
• Avoid dealing with underperformance in an aggressive or heavy
handed way as this can lead to discrimination or constructive dismissal
claims
• Hilton Hotels International (UK) Ltd v Protopapa [1990] IRLR 316 –
claimant found to be humiliated, intimidated and degraded to such an
extent that she had been constructively dismissed by reason of the
employer’s conduct

26. Red flags
• Difficult conversations
• Prepare
• Get advice or support
• Do not avoid the conversation by using email when face to face or
telephone communication is more appropriate
• Hold meetings in private
• Maintain eye contact
• Be tactful and not accusatory
• Offer help – don’t just criticise
• Keep on track
• Listen carefully
• End on a positive
• Follow up appropriately

27. Without Prejudice/pre termination discussions
• The Enterprise and Regulatory Reform Act 2013
• The principle: ‘without prejudice’ conversations prevent written or oral statements
made in a genuine attempt to settle the dispute from being used as evidence in court.
• When does it apply: if there is a formal dispute –will often not apply before
employment has ended.
• The risk: that the employee could use the approach to trigger or support an unfair or
constructive unfair dismissal claim.
• Caution!
• Only in ordinary unfair dismissal claims
• Must be no improper behaviour or undue pressure

28. ANY QUESTIONS?

29. Managing
Performance

30. Performance Management
“When a team outgrows individual
performance and learns team confidence,
excellence becomes a reality.”
Joe Paterno

31. How can we measure performance?

32. 360 Degree Feedback

33. What is performance
development?
It’s about alignment

34. Objectives for performance development
• Identify areas of competence
• Assess individual performance against competencies as well
as objectives
• Provide an opening for discussion about performance and
development
• Provide a basis for personal and career development
• Agree long and short term objectives
Formal and positive process with no surprises

35. Have we reached our objectives?

36. PERCEIVED SITUATION
Hostile, unfriendly, antagonistic
- - - - - - - - - - - - - - - - - - - - - - - - -
Friendly, favourable
Marston’s Theory
ACTIVE
BEHAVIOURS
PASSIVE
BEHAVIOURS
Dominance
(POWER)
Compliance
(POLICY)
Steadiness
(PACE)
Influence
(PEOPLE)

37. Who are you?
FOCUS ON POWER AND
AUTHORITY SEEKS DIRECTION

38. Who are you?
• Assertive
• Competitive
• Driving
• Forceful
• Inquisitive
• Self-starter
• Accommodating
• Hesitant
• Low decision need
• Mild mannered
• Non demanding

39. Who are you?
FOCUS ON PEOPLE AND
RELATIONSHIPS SEEKS REALITY

40. Who are you?
• Communicative
• Friendly
• Influential
• Networker
• Persuasive
• Positive
• Verbal
• Probing
• Reflective
• Reserved
• Self conscious
• Serious
• Suspicious

41. Who are you?
FOCUS ON SERVICE/
SPECIALIST SEEKS VARIETY

42. Who are you?
• Amiable
• Deliberate
• Dependable
• Good listener
• Kind
• Methodical
• Persistent
• Thorough
• Active
• Alert
• Demonstrative
• Mobile
• Restless

43. Who are you?
FOCUS ON QUALITY/
TECHNICAL/POLICY SEEKS AUTONOMY

44. Who are you?
• Accurate
• Careful
• Compliant
• Logical
• Perfectionist
• Precise
• Systematic
• Firm
• Independent
• Persistent
• Strong willed
• Stubborn

45. So now we have a better idea of our
own profile – how can we have
difficult conversations with different
profiles?

46. Identifying Dominance:
• Drive
• Competitive nature
• Single-mindedness
• Self-esteem
• Assertive
• Direct
• Self-starting
• Blunt
• Forcefulness
PPA

47. Identifying Dominance:
• Drive
• Competitive nature
• Single-mindedness
• Self-esteem
• Assertive
• Direct
• Self-starting
• Blunt
• Forcefulness
• Pioneering
PPA

48. Communicating with Dominance:
DO:
• Argue facts not feelings
• Be clear and specific
• Provide alternatives
DON’T:
• Use too much detail
• Leave loopholes
• Take too long
PPA

49. Identifying Influence:
• Empathy
• Confidence
• Charm
• Optimism
• Persuasiveness
• Friendliness
• Verbalisation
• Positivity
• Emotion
• Rapport

50. Communicating with Influence:
DO:
• Ask opinions and ideas
• Be fun and fast paced
• Summarise in writing
DON’T:
• Talk facts and not feelings
• Be cold or argumentative
• Lose conversation control!
PPA

51. Identifying Steadiness:
• Dependability
• Self-control
• Predictability
• Patience
• Deliberation
• Amiability
• Persistence
• Calmness
• Listening
• Consistency

52. Communicating with Steadiness:
DO:
• Present logically & thoroughly
• Listen and ask questions
• Show sincere interest
DON’T:
• Threaten with repercussions
• Be too abrupt or pushy
• Force a quick decision
PPA

53. Identifying Compliance:
• Self-discipline
• Sensitivity
• Shrewdness
• Precision
• Caution
• Adaptability
• Perfectionism
• Conformity
• Strict
• Rule-orientation

54. Communicating with Compliance:
DO:
• Be systematic and organised
• Give information in writing
• Present specifics
DON’T:
• Be informal or too personal
• Be disorganised or vague
• Be confrontational
PPA

55. We provide people assessments
which empower businesses
to transform and improve the
performance of their employees

56. Any Questions?
April Rose Waters
Consultant
aprilw@thomas.co.uk
www.linkedin.com/in/aprilrosewaters

57. Any Questions?
April Rose Waters
Consultant
aprilw@thomas.co.uk
www.linkedin.com/in/aprilrosewaters

58. Thank You

59. Bolt Burdon Solicitors
Emma Peacock
E: emmapeacock@boltburdon.co.uk
T: 020 7288 4742
Kaajal Nathwani
E: kaajalnathwani@boltburdon.co.uk
T: 020 7288 4743