I completely agree with Madhu T. K.
You are running a huge risk by attempting to do this, if it is not mentioned in the appointment order. Your employer brand value as a company to work for, gets hit because the good performers will not really be interested in working for you. Your cost of acquisition as well as cost of vacant positions will increase because of the extra time required to fill your vacancies. You may be required to compromise on manpower quality now to fill vacancies, in which case, you will be back where you started vis-a-vis achievement of performance goals. A costly process, right?
Additionally, do you think it fair that the employee is being penalized in this method, but his managers are not? Since the manager's role is to support his team, he should also share in the deduction of such monies, and so on, this chain should go right to the top management since in this way, the organization will be seen as taking collective responsibility.
If anyone wishes to debate further, one can also say that inputs / support were provided, yet the employee did not deliver - I would state that the manager is still at fault because he and his seniors was a part of the hiring process. So again it is collective responsibility.
Just my thoughts.
Regards,