Informing employees of underperformance can be a difficult task for employers, particularly when employees don’t handle the feedback well. It is a common scenario that disgruntled employees retaliate by making a ‘bullying’ claim against their supervisors. The good news is that employers are well within their rights to implement processes to rectify poor performance to steer workers back on track. Provided that the steps taken by the employer constitute reasonable management action that has been carried out in a reasonable manner, the worker’s bullying claim will not succeed.
In a recent case an AGL engineer, who previously attracted positive performance reviews, has failed to convince the FWC that his supervisor’s actions in placing him on successive performance improvement plans (PIP) amounted to bullying. During his employment, the employee received praise for his “outstanding work ethic and capability” until he was promoted, and matters began to shift. Under a new supervisor who more closely scrutinised the employee’s job description, the employee was eventually placed on a PIP alongside 2 of his colleagues.
The Commission heard extensive evidence from AGL which indicated that their concerns over the employee’s performance were justified. The company followed their Counselling for Improved Performance and Disciplinary Policy, which required supervisors to informally coach employees before placing them on a formal PIP. Despite being told about his performance shortcomings, the employee showed little improvement.
The employee argued AGL was not justified in placing him on a PIP and this constituted unreasonable management action. He submitted that that three of the five areas of underperformance identified by his supervisor in the PIP related to matters which were not within the scope of his role. He also argued that the PIP process was not carried out in a reasonable manner because his employer knew the extent to which the process was affecting his health, including severe depression and anxiety, yet continued to impose the PIP on him.
AGL contended that the work actions contained in the revised PIP were appropriate to the employee’s role as engineer and that the employee agreed to this during the extensive PIP meetings that were held. After closely examining the position descriptions, the supervisor found them to be very ‘generic’ and he took time to communicate in more "granular" form what was expected of each employee. However, the employee continuously failed to meet these standards, which led to the imposition of the initial and revised PIPs.
The FWC was not satisfied that the expectations, work actions or timelines contained in either the initial PIP or the revised PIP were not achievable or were unreasonable. The Commission considered the employee’s performance against the range of issues identified by the supervisor, and found that there was a reasonable, evident and intelligible justification to place the employee on the successive PIP’s.
The FWC concluded that the successive PIPs were reasonable management action carried out in a reasonable manner.
Lessons for employers
- When performance issues arise, employers must clearly communicate standards and provide employees with a reasonable timeframe for improvement.
- Review your performance management policy and bullying policy. Ensure that any action taken is in accordance with the applicable policy and confirm that procedural fairness is afforded. Check that your bullying policy refers to the FWA definitions and includes a complaints mechanism which allows employees to raise issues internally.
- The individual steps taken will differ depending on the facts and circumstances. The action doesn’t need to be perfect or ideal, but it must be reasonable management action that is carried out in a reasonable way.
Under the Fair Work Act, reasonable management action carried out in a reasonable way does not constitute workplace bullying. In a recent case, an employee, who previously attracted "distinctly positive" performance reviews has failed to convince the FWC that his supervisor’s actions in placing him on successive performance improvement plans (PIP) amounted to bullying.
 Miroslav Blagojevic v AGL Macquarie Pty Ltd; Mitchell Seears (AB2017/585) 23 MAY 2018.
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Article Published by BlandsLaw on 11.2.2019