The procedural fairness requirements of the Fair Work Act, 2009 (Act) together with the recent line of decisions of Fair Work Australia (FWA), impose on employers an obligation to act carefully and consistently when disciplining and managing employees. This article addresses some practical strategies for effective performance management in the workplace.
Disciplining employees exposes an employer to risk of claims of adverse action or unfair dismissal. Decisions being handed down from Fair Work Australia demonstrate the breadth of the adverse action provisions under the Act which can extend to be invoked to grant injunctive relief, award for compensation or reinstatement.
The following tips for performance managing your employees may help to minimise the risk of such exposure:
- Rigorous performance management
Employers need to constantly audit the performance of their employees to ensure their business is running as effectively as possible. Feedback should be an ongoing task rather than an annual event. A rigorous approach to performance management provides a forum to both recognise employee performance and also counsel or dismiss an employee for non-performance.
Having a performance management process in place facilitates employers to address issues and concerns as they arise rather than a retrospective annual consideration of past performance. Addressing and documenting concerns in the workplace as they occur set expectations for employees and minimise risk exposure to claims in the event of dismissal.
- Consistency when dealing with analogous circumstances
Consistency in dealing with employees is important. However it is important that a distinction is made between consistency in terms of processes as distinct from outcomes. The circumstances of each matter need to be regarded particular to their own facts. What is important is that an employer adopts a consistent approach or process in the performance management of its employees. For example, an employee accused of misconduct should expect to be similarly investigated and disciplined in the manner in which a co-worker was investigated and disciplined who had also been accused of misconduct.
Being able to demonstrate that employees have been consistently performance managed will assist in defending claims of unfairness or unreasonableness.
- Affording the right to a witness or support person
The role of a support person is to provide emotional support for someone being interviewed or disciplined and act as that person’s witness. Affording the right to a witness or a support person during a counseling or disciplinary meeting may avoid a criticism of unfair conduct on the part of the employer.
In the matter of Bermingham v Kings Transport and Logistics (Aust) Pty Ltd  FWA 1116, whilst the FWA considered the termination of Mr Bermingham justified, the employer was criticised for what was in effect, a poorly implemented termination.
Mr Bermingham had applied to FWA for relief with respect to the termination of his employment. He argued that his dismissal was unfair, due to not being afforded the right to a witness in the termination meeting and also on the basis of the incorrect description of the fraudulent activity in the termination advice.
- Adopting a suitable forum for discussion
It is almost trite to say, but adopting a suitable and appropriate forum for a performance discussion to take place is important. Consider the nature of the discussion and whether it is appropriate for such a meeting to be held at for exampled head office or an allocated meeting room.
- Affording the opportunity of a right of reply
In the course of a performance management discussion it is important that an employee is given the opportunity to respond. It is equally important that any such response be properly and fairly considered to minimise a determination that an employer’s conduct was harsh or unreasonable.
In the matter of Bermingham the FWA considered the employer’s termination flawed as it had made the decision to terminate Mr Bermingham’s employment before he was called to the disciplinary meeting. Mr Bermingham was not asked or afforded the opportunity to respond to the specific allegations which the employer may otherwise have put to him and FWA determined the termination unreasonable commenting on the “substantial inadequacies associated with the investigation and the inequities which this invited”.
Performance meetings and having an effective performance management process in place is invariably demanding and it is not uncommon for employers to be concerned about the manner and method of dealing with difficult or non-performing employees.
By keeping in mind the above performance management tips, this will help minimise the risk of exposure to adverse action and unfair dismissal claims as such actions find greater momentum under the protections afforded in the Fair Work Act.
For more information or to discuss the above article in more detail, please contact Andrew Bland on (02) 9805 5600 or at [email protected]