There is a point in almost every business when an employee is not performing as well as expected.

Perhaps their work is taking too long. Maybe they are making repeated mistakes. They might be missing deadlines, struggling with their responsibilities or simply not meeting the standard you need.

For a small business owner, this can be particularly difficult.

You may know there is a problem, but you may not know how to raise it without making the situation worse.

The temptation can be to leave it alone and hope things improve.

Usually, that is not the best approach.

The earlier you address a performance issue, the more opportunity there is to understand what is happening and help the employee get back on track.

Start with the conversation

Before assuming that an employee is simply not trying hard enough, talk to them.

Choose a private setting and explain what you have noticed.

Be specific.

Instead of saying:

“You are not performing very well.”

Explain what you have actually observed.

For example:

“We have noticed that several customer orders have been completed incorrectly over the last few weeks.”

This gives the employee something clear to respond to.

There may be a reason you were not aware of.

They may not have received enough training. They may have misunderstood what is expected. Their workload may have changed. There could also be a health issue or another circumstance affecting their ability to perform their role.

Acas recommends that employers try to understand why there is a performance problem and consider what support, training or coaching might help.

Make sure the employee knows what good performance looks like

It is difficult for someone to improve if they do not know exactly what is expected of them.

Ask yourself whether the employee has been given clear standards.

Do they know what they are responsible for?

Do they understand the deadlines?

Have you explained what level of quality is expected?

Are their objectives realistic and achievable?

Clear expectations are important for good performance management. Acas recommends that objectives should be specific, measurable and realistic for the employee’s role and workload.

If expectations have never been properly explained, it may be unreasonable to expect an employee to know that they are falling short.

Give them the opportunity to improve

Once you have discussed the problem, agree what needs to change.

This does not necessarily need to be complicated.

You might agree that a particular task needs to be completed more accurately, that deadlines need to be met or that the employee needs additional training.

Set a reasonable period for improvement and arrange a follow up conversation.

Keep a written record of what you discussed and what was agreed. Acas recommends keeping records of performance discussions and sharing the record with the employee.

This is useful for everyone.

The employee knows exactly what they need to improve and you have a clear record of the steps you have taken.

What if nothing changes?

Sometimes an informal conversation and additional support are enough.

Sometimes they are not.

If the employee does not improve, you may need to move towards a more formal performance management process.

A performance improvement plan, often referred to as a PIP, can be useful in these circumstances.

A good PIP should explain:

• What needs to improve

• What standard is expected

• How improvement will be measured

• What support or training will be provided

• When progress will be reviewed

• What may happen if the required improvement is not achieved

The plan should be realistic and discussed with the employee rather than simply handed to them.

Don’t confuse capability with conduct

This is an important distinction.

Capability is generally about whether someone has the ability to do their job.

Conduct is about their behaviour.

For example, someone who is struggling to use a new computer system may have a capability issue and could need training.

Someone who understands the system but deliberately refuses to use it could be a conduct issue.

The appropriate response can therefore be very different.

Acas recommends considering whether a problem is capability or conduct before deciding what action to take.

What if there could be a health or disability issue?

This is an area where employers need to take particular care.

A sudden change in someone’s performance could potentially be connected to their health or a disability.

That does not mean you cannot manage performance.

It means you should take the circumstances into account and consider whether reasonable adjustments or additional support may be appropriate.

For example, an employee may be capable of completing their work but may need a change to their working arrangements, additional equipment or more time for certain tasks.

Acas states that employers should consider reasonable adjustments where a disability is affecting performance.

If you are unsure, it is sensible to get HR advice before taking formal action.

Don’t jump straight to dismissal

It can be tempting to think:

“We have given them enough chances. Let’s just get rid of them.”

That approach can create significant problems.

If an employee is struggling with performance, employers should generally give them an opportunity to improve and provide appropriate support before considering dismissal. Acas states that dismissal for capability should be a last resort and that employers should have evidence of the performance problem and the steps taken to support improvement.

A fair process protects the employee, but it also protects the business.

What should a small business owner do next?

If you have an employee whose performance is causing concern, start by asking yourself five questions:

What exactly is the problem?

Be clear about what is not meeting the required standard.

Does the employee know what is expected?

You cannot reasonably expect improvement if expectations have not been explained.

Have we given them the right support?

Consider training, coaching, resources and any other practical help.

Could there be an underlying reason?

Give the employee an opportunity to explain what is happening.

Have we kept a record?

Make a note of conversations, agreed actions and progress.

These simple steps can make a difficult situation much easier to manage.

You don’t have to deal with it alone

Performance problems can be uncomfortable, particularly when you are running a small business and know the people involved personally.

You may also be concerned about saying the wrong thing or taking the wrong approach.

That is where professional HR support can make a real difference.

Westcountry HR helps small and medium sized businesses across Newton Abbot, Exeter, Plymouth and Devon with performance management, employee issues, contracts, policies and day to day HR advice.

The aim is not to make every employee problem formal.

It is to help you deal with issues early, fairly and sensibly.

Need help with an employee performance issue?

If you have an employee who is not performing as expected and you are unsure what to do next, Westcountry HR can help.

We can talk through the situation, help you understand your options and support you through the appropriate process.

Contact Westcountry HR to arrange your free first visit.