When you run your own business with a small team, you can’t afford to carry someone who is not pulling their weight. However, if there’s no serious misconduct involved, your initial approach should be to help the person lift their game. “This is 10 times easier if you’ve already put expectations in place” says Jon Windust, CEO of HR technology specialist, Cognology. He advises business owners to talk to staff regularly about performance expectations. “You need to be specific about the outcomes you want, provide feedback regularly and coaching where needed,” he says.
Follow a plan
It also helps if you have a plan. Start with the Fair Work Ombudsman’s Guide to Managing Underperformance for tips on developing a checklist, such as:
- Discover the reasons for the problem. Is it a lack of necessary skills? Do they have personal issues? Do they not understand what’s expected of them?
- Set up a meeting. Stick to the facts in a non-confrontational way and make sure they understand what you expect of them.
- Provide an opportunity to improve. Come up with a joint solution so the employee feels encouraged to do better.
- Monitor their progress and provide feedback. Schedule follow-up meetings and set a realistic timeframe for improvement.
- Keep notes of all formal and informal discussions (these can be used as evidence if legal action is taken).
Make a clean break
Inevitably, there will be some staff who just won’t perform no matter what training and support you offer. At that point, you owe it to everyone else depending on the business for their livelihood to move them on. But always act – and be seen to act – fairly. This reduces the chances of legal action and reassures other staff you’re not going to fire them on a whim.
Never sack someone in the heat of the moment. Check out the Fair Work small business guides to unfair dismissal laws. Consult your legal adviser if you’re unsure of your obligations. When you inform the employee of their dismissal, keep the conversation short and businesslike. Once they’ve left the premises, tell your remaining staff what’s occurred.
“A good leader should talk to staff to let them know what’s happened while avoiding personal details,” says Windust. “You need to reassure your team about how the extra workload will be handled and if you’ll be hiring a replacement, so their concerns aren’t left hanging.”
In today’s digital world, you also need to ensure that a (possibly disgruntled) ex-employee can’t wreak cyber-havoc after they’ve left premises. So make sure to remove their ability to remotely access work computers and update log-ins, ideally right before you terminate them or, if that’s not possible, immediately afterwards
Protect your livelihood
Many business owners worry that if they do let someone go they could end up embroiled in a time-consuming and costly legal battle. This provides one more good reason to keep your business insurance up to date. Management liability insurance can protect your business and personal assets from being sold to cover the cost of paying claims for employment breaches such as wrongful dismissal.
In a social media age where everyone is a publisher, it’s not uncommon for employment disputes to be played out online. If an ex-employee accuses you of defaming them (while you’re attempting to defend your personal reputation or that of your business), your management liability insurance can cover you against any defamation claims that arise.
If you’ve got solid performance expectations and procedures in place, and your business is covered against claims, dismissing an underperforming staff member should be far less of a risk than allowing them to stay on indefinitely
Call Petplan Professional for a Management Liability quotation today.