For those employers which have been fortunate enough to avoid the need for compulsory redundancies, 2020 was a year that, in many industries, saw very little natural attrition in headcount. Employees were choosing to stay put, given the economic downturn. This can be an issue, as many employers assume a regular “churn” of employees for budgeting purposes and particularly so in an “up or out” environment. This comes alongside the challenges of managing performance during the pandemic and consequential remote working.
The redundancy route
As a means of managing headcount, redundancy is a very different proposition to performance management. Redundancy takes out roles, not poor performers.
Redundancy can also (potentially) be expensive, with additional payments due to employees. Most importantly, a redundant position cannot be re-filled by someone who can do the job more effectively; the position has been eliminated and filling it immediately exposes an employer to an unfair dismissal claim on grounds that the redundancy was not genuine.
Employers looking to manage attrition and to upgrade existing talent need to turn to proactive performance management. In preparing for the economic upturn, employers need to focus on this now to be in the best (and leanest) shape: fair and effective performance management doesn’t happen overnight and means considerable management-hours investment. However, retaining and growing the best mix of talent will no doubt be a defining feature of those companies which pull out of the pandemic most successfully.
Restrain, retain or retrain
The rules of performance management have now changed: observing and measuring performance is inevitably more difficult in an environment in which frequency of contact and physical supervision is limited. Employees’ domestic responsibilities (such as home schooling or caring for shielding or sick household members) are part of daily working life and, often most difficult, performance management is being conducted remotely, often intrusively in an employee’s own home.
Set out below are my top five tips for dealing with the challenges of managing poor performance.
Do not delay
Poor performers are unlikely to get any better working remotely with an absence of management. If there is potential for turning performance around (or even if there isn’t) a hands-on and proactive performance plan needs implementing, immediately. Waiting for us all to get back to the office environment is not the answer. Engaging with the employees now is vital, as is providing direction and feedback (and keeping a record of it). Fair performance management takes months. Assuming we are all vaccinated and have some hope of an economic uptick by the autumn, employers want to be at “fighting weight” by the end of summer. An average performance improvement plan (PIP) takes anywhere between three and six months. Start now.
Managing headcount and talent upgrades are intensive processes; every week is an opportunity for a check in, highlighting deficiencies and setting development goals. If there are genuine reasons for the drop-off in performance, engaging with the employee will reveal those and you can then move to supporting the employee as required. In performance management terms, every week is everything.
Be firm but be kind
Many people are struggling; from the loss of loved ones and serious mental health issues to a lack of WiFi or lack of a decent office chair. Make sure that you make room for “an employee’s life” in your PIP. Your staff are your key asset; supporting an employee in a time of crisis is loyalty that a salary rise or a bonus often cannot compete with. The most difficult conversations can be done professionally, swiftly and compassionately. If you don’t know how to do them, script them and work with your HR professionals to prepare. Plan conversations carefully and bear in mind that drawing out these situations rarely helps either party. If an employee says they are stressed by the process, moving through it without delay can often be the most compassionate way of resolving a situation.
Flexibility is a friend
Being accompanied at a virtual meeting can be tricky. Be prepared to be flexible and, if an employee wants to be accompanied by a member of their household or social bubble, it may be better to err on the side of agreement. Be clear about the limits of the accompanying person’s role and don’t be afraid, as “host” of the virtual meeting, to make use of the mute button. Difficult messages are being given and received directly into an employee’s own home. There is no opportunity to “wind down” with colleagues, so flexibility of process to allow support can be important.
Be clear in your messages
An employee needs to be told there must be improvement if there is any hope of a successful PIP. I have seen too many meetings where messages are half given (and half received) because it is too difficult for the manager and employees are told to “speak to HR”. It is uncomfortable telling an employee that the level at which they are performing is simply not good enough, but it is only fair. Do not fudge a disciplinary process and rely on redundancy as a “no fault” dismissal. It may be simpler in the short term to tell an employee that their position has been eliminated, but the consequences are far more damaging. Any redundancy unnerves other staff, particularly at the moment, and it can have a very direct impact on retention of those you want to keep. There is also nothing more frustrating for those who are performing to see under-performers go unmanaged.
Now is the time to focus on the performance of your workforce to be in the best shape possible for the second half of the year. Proactively assessing performance across your organisation gives you an opportunity to engage with your staff and shape your talent.