How Conducting an Employee Performance Improvement Plan Properly Will Make You a Better Manager

How Conducting an Employee Performance Improvement Plan Properly Will Make You a Better Manager

How Conducting an Employee Performance Improvement Plan Properly Will Make You a Better Manager

From an employee’s perspective who may not be doing the job to his or her greatest potential, a Performance Improvement Plan (PIP) often means the first step in being fired. From the perspective of a manager, it presents an opportunity to give that employee another chance to be successful, and make meaningful improvements. Unfortunately, many companies handle PIPs the wrong way. In this article, we will look at how a PIP can be effective in turning around an employee’s performance, if that is the outcome that both employee and manager want to see.

PIPs help managers, too
In his 1954 book The Practice of Management, the first book written about management as a profession, Peter Drucker said that a manager’s primary role is to “make people productive.”

The five functions of a manager detailed in this business classic include:

  1. Setting objectives
  2. Organizing
  3. Motivating and communicating
  4. Establishing targets and performance
  5. Developing people

Number five on Drucker’s list is developing people, which includes the manager developing him or herself. Conducting a Performance Improvement Plan is a perfect opportunity for managers to sharpen their own skills in motivating and communicating, establishing targets, measuring performance and developing people.

A framework for conducting a Performance Improvement Plan
When an employee is underperforming, and the manager is willing to give them one more chance to turn it around, a PIP gives the employee the opportunity to be successful while being accountable for their past performance. A basic framework for conducting a PIP with an employee who is willing to take responsibility for rising to the occasion and improving their job performance includes:

1.) Document the main performance issues.

  • What are the grounds for the PIP?
  • Provide examples that clarify the pattern of unacceptable performance.

2.) Develop a plan to resolve the performance issues.

  • What are the objectives of the PIP?
  • What will success look like?

3.) Set clear expectations

  • Work with the employee to set SMART goals.
  • Set target dates for achieving the PIP objectives. (commonly 60 to 90 days)

4.) Inform employee of the resources available such as training, coaching or mentoring
5.) Monitoring and follow-up

The manager needs to schedule regular meetings to monitor the employee’s progress and allow the employee to ask questions and seek guidance. He or she must avoid becoming emotionally involved in the situation while being considerate of the employee’s feelings while the PIP process is playing out. Endeavor to give candid answers when the employee asks questions about the PIP process and the possible outcomes. Finally, avoid using a PIP as a threat to intimidate an employee to modify their behavior or performance.

What about mixed results?
A PIP is not a miracle worker. An employee who has been placed on a PIP may have shown some areas of improvement between 60 and 90 days, but there is still room for improvement. In cases like this, a manager has a couple of options.

  • Revisit the objectives of the PIP and make sure that they were realistic and achievable given the time constraints.
  • Consider extending the deadline if acceptable progress has been made so far.
  • Assess whether it looks like the employee may not be a good fit for the demands of the position and whether termination is the best solution.

Tips for delivering the PIP
The legal blog Law360 offers some smart tips on how to deliver a PIP. It recommends that when a manager must deliver a PIP to an employee, that it is done in a face-to-face meeting, in a private setting and with an HR representative present who will serve as a witness. The presence of the HR representative can lower the dial on the potential for tension and it can help to keep the meeting on track. The HR representative can deliver the details of the PIP if the relationship between the manager and the employee is not ideal.

The manager must set reasonable performance standards in the PIP, and must be candid about how the employee performed in the PIP. If the employee is ultimately terminated and files an employment discrimination lawsuit, the PIP should contain clear documentation about whether the employee’s performance improved to meet the company’s expectations in the PIP.

Concluding the PIP
If the employee is not committed to improvement and chooses not to participate fully in the PIP, the manager might consider ending the PIP, reassigning the employee to another position or terminating their employment.

If the employee does show commitment to the PIP process and their performance does improve. the manager should conclude the PIP and allow the employee to carry on with their work.

About Alex Gertsburg

At Gertsburg Law, our attorneys have a comprehensive understanding of the countless issues facing businesses on a daily basis. Most of our experienced attorneys in the Chagrin Falls and Cleveland offices are former business owners and in-house counsel, bringing a unique perspective and depth of knowledge to their skill set. We will work with you to understand your goals and to find the right solution for your organization.