Dinesh DivekarDear Priya,
Under-performance of an employee and removal of employee because of loss of projects or adverse market conditions are two separate things. Both are unconnected. You need to choose either ground for the removal. Considering the background of the case, it is better if you remove employee on the grounds of under-performance it is better.
Since you have issued the warning letter for poor performance already, you may order domestic enquiry. In the enquiry, let it be proved that the employee was given sufficient chance to improve his performance. It it be proved that your organisation had put up sufficient efforts to improve his performance. On completion of enquiry, you may issue the show cause notice as to why disciplinary action should not be taken against him. If the reply is not satisfactory, you may terminate him. However, instead of issuing termination letter, send employee to submit letter of resignation.
You may tell employee to submit resignation even now also by skipping the domestic enquiry. Nevertheless, these price of these shortcuts organisations come to know if the employee goes to the court for pressuring him for resignation. Therefore, route of domestic enquiry though little longer, is perfect and inerrable.
From India, Bangalore
ANIL RAINAHi Priya,
If the employee is on probation, he can be given a discharge simplicitor. No need to mention any reasons.
If he is a confirmed employee & in the managerial category, he can be given two warnings & if he does not show any improvement, can be issued a termination letter with the notice period as mentioned in his terms of appointment. Domestic enquiry may not be necessary.
If he is not in the managerial category, please follow directions given by Mr Divekar.
If there is a transfer clause in the appointment letter, transfer him to a place where he is not likely to proceed. He will most likely submit his resignation. However, transfer should be done for reasons of business exigency & should not mention anything regarding his underperformance or else our action will be seen as mala fide.
From India, Delhi
KK!HRI presume that you are in IT sector and the employee concerned is serving in managerial capacity. In that case, serve him a simple discharge letter stating that "Your services are no longer required and you are discharged from service w.e.f. ../../.... as per clause no . of the appointment order/service conditions agreed and accepted by you. The dues, if any, payable to you shall be settled on production of No Demand Certificate from all concerned". Imp. in case you mention of poor performance in the discharge letter it will be treated as a punitive action necessitating a disciplinary action as pointed out by Shri Divekar Sir above. If the situation is different, then more details are needed, like whether he is an industrial employee coming within the definition of 'Workman' under the ID Act 1947.
From India, Mumbai
If the concerned employee is rendered redundant that is no work available for her or others doing similar type of work, you can retrench them, but you cannot pick and choose, you need to put up a seniority list of all those workmen who are rendered surplus due to loss of projects according to their date of joining the organisation. Then a general notice is to be put and the last employee who joined the services will be the first to go and for this you need to pay retrenchment compensation at the rate of 15 days salary per completed year of service and 1 months notice pay.
If you need to terminate one particular employee for under performance, you have to conduct a domestic enquiry and it has to be proved that the workman has neglected his duties or gross negligence.
The concept of discharge from services is no longer valid because now as per the judgments of the courts any termination can come within the ambit of retrenchment and not following the procedure will render it per se void.
From India, Pune
Bangalore SecretaryImagine you’ve recruited an employee who, for all intents and purposes, seemed competent enough.
At least, that’s what you thought when you hired him.
But over the last few months, you’ve noticed that he is just not performing up to the standard you were expecting. Maybe he’s missing deadlines, turning in incomplete reports or just isn’t “getting it”.
You need to do something. You don’t have time to babysit, and constant errors are affecting your team’s credibility. You see nothing else to do, but let him go.
But terminating an employee on a whim can be a risky move for your business. You need a practical and fair process help reduce your liability. Moreover, it’s best to give employees plenty of time to improve, and give them the tools needed to get there. After all, recruiting, hiring, onboarding and training a new employee can be very costly.
But when all else fails, termination may be necessary. In these cases, it’s best-practice to follow a progressive discipline process – which generally includes a series of increasingly severe penalties for repeated offenses – if you want to conduct performance-based terminations the right way.
Here are a few things to keep in mind before you get to that step.
1. Write down everything
Documentation is key. If you don’t write something down, it can be argued that it didn’t happen. Even informal conversations written in a notebook can be helpful and count toward documentation.
I know what you’re thinking – documentation takes time. Time you don’t have. Nonetheless, it can be your friend should you have to defend your decision.
2. Clearly communicate expectations
Let’s start at the very beginning.
For every job, you should have a job description. Even if you don’t have anything formalized, you should have a solid understanding of the functions and responsibilities of each role on your team. You should also know what it takes for employees to be successful in each role.
And it’s essential that your employees know this, too.
Don’t assume. People come with their own perspectives that don’t always match their boss’. Each role should be clearly defined. This makes it easier to pinpoint and correct problems.
Additionally, your progressive discipline policy should already be established, outlining how corrective action and termination should take place should you need to go there. This helps ensure every issue is handled consistently and fairly.
3. Be a good coach
Both new and existing employees should be coached. This is informal feedback and consists of what’s right as well as what’s wrong. Think of a football coach. He gives praise for a good pass or a solid tackle, but also points out the missed catches and holes in the defense.
Your employees need this feedback to understand how they are doing well before you get to the point of considering disciplinary action or termination.
4. Initiate a performance improvement plan (PIP)
So, let’s say you’ve provided ongoing coaching, but you’re seeing some major concerns with performance that the coaching hasn’t affected. This would be a good time to develop a performance improvement plan (PIP).
The PIP should articulate specifically what the problem areas are and give detailed goals for what is expected to correct it.
In some cases, a verbal counseling might be the better way to go. Use this in addressing things like, attendance, communication and other behavioral issues.
Here’s an example of the right way to word an attendance-focused counseling:
Kiran Kumar will arrive at work before the start of each work shift and clock in on or before his start time. He will promptly return from scheduled break times and work until the end of each shift. Improvement needs to be immediate, marked and sustained. Failure to work all scheduled shifts in their entirety or continued punctuality issues could result in discipline up to and including termination.
If you have more skills-based issues, a PIP might be more appropriate. For example:
Rajesh has been submitting reports with numerous grammatical, spelling and technical errors. Within the next 30 days, Rajesh needs to complete Business Writing 101, as well as utilize grammar and spell checking tools prior to submitting reports. Technical data should be reviewed by the Engineering group. We will meet again on next Tuesday to review progress.
In any case, the timeline given to improve should be reasonable. Some deficiencies are quicker to fix than others. Keep this in mind.
Document the conversation and plan. Have your employees sign an acknowledgement form to confirm that they understand. If you do a verbal counseling, send a follow-up email to your employees (no signature needed).
However you handle it, be sure to make plans to follow up.
Hold regular follow-up meetings. Don’t put them off. Make sure you document these conversations and have employees sign that they attended the meeting. Give them specific feedback on how they’re doing. If results are mixed, share with them what they’re doing right as well as what they’re doing wrong.
Now – this part is important – if you don’t see improvement, or if the employee is still making similar errors, address them. Don’t wait until your next follow-up meeting. And keep notes on what you’ve addressed and when.
5. Conduct a written counseling
If things are getting really egregious, you may need to move to a written counseling.
A written counseling is somewhat similar to the PIP. It should outline areas that employees need to correct. Again, in writing, detail specifically what needs to improve and how this should be accomplished.
The counseling form should also express that improvement needs to be immediate, marked (noticeable) and sustained.
Employees should sign this form after you’ve discussed it with them. This doesn’t mean they have to agree with what you’ve documented. Their signature simply indicates that they have received the counseling.
6. When all else fails, terminate employment
Despite all of your efforts, you still may not see the type or quality of improvement needed, and the only option left is to sever the relationship. However, by now, you should have clearly documented what you did to help the under-performing employee improve.
Performance-based terminations should never come as a surprise to your employees.
Prior to terminating your employee, be sure to review all associated documentation. Also, contact your legal counsel or HR representative to ensure your case is supported, justified and sound. Confirm that you’re following all state-specific wage and hour regulations. And if you use employment contracts or non-compete/non-solicitation agreements, you should ask your legal counsel to provide you with validity and enforcement guidance.
In releasing employees, honesty is the best policy.
While your goal is not to make anyone feel bad, you should also not disguise a performance-based termination as a “layoff” or request the person to resign.
For example, you can say, “Kiran, as you know, we’ve talked a few times about your attendance, and we haven’t seen this improve as we would have liked. That said, we have made the decision to terminate your employment effective immediately.”
So, when is the best day or time to have this kind of conversation?
Honestly, there really is no “good” time. It’s never an easy conversation. However, there are some times that are less desirable than others.
For example, Friday afternoons are typically not ideal because the released employees have the weekend to dwell on their new reality.
Opinions on when to terminate can vary widely, but ultimately, earlier in the week is preferable, as well as earlier in the day.
The only thing worse for your business than a bad employee is bad documentation.
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From India, Bangalore