One of the most common occurrences that defense counsel encounter, or seem to encounter, in defending wrongful termination claims is the lack of support for an employer's complaints about an employee's poor performance. Very often, the way you proceed when you take action against an employee who isn't "up to snuff" can have serious ramifications for you in the future. Too frequently, employers don't take the time to review their employees' performance properly. That can lead to confusion, lack of communication, and misunderstandings. It also can lead to a lack of factual support when a terminated employee claims, "I was never told that I wasn't doing my job."

The issue can often lead to problems when defending against wrongful termination claims. But if you properly review your employees' performance, you can generate such factual support and also reduce the likelihood of claims in the future. Therefore, you should take the time to thoroughly and accurately review your employees' performance.

An example

An employee claims he was disciplined for illegal reasons (such as discrimination). The employer's response is that the employee was appropriately disciplined for his own poor performance. A review of the employee's personnel file, however, reveals a lack of documentation demonstrating poor performance. While that doesn't prove his claim, it may call into question the legitimacy of the employer's action. You can avoid that problem if you properly review your employees' performance.

Implement effective procedure for reviewing performance

You need to implement an effective procedure for reviewing your employees' performance. The procedure should be clearly articulated between your managers and employees and should be strictly followed. Reviews should be done regularly, properly, and effectively. Often, employers don't want to take the time necessary to do a thorough review of their employees' performance. Failure to do so may result in both inadequate information to assess your employees' performance and an insufficient basis to discipline an employee if necessary.

Conduct a proper review

It's important that you regularly conduct performance reviews and have input from supervisors during the review process. It can also be effective to have the employee's input in the review. Employees often are willing to discuss their employment and issues they see surrounding their employment. They can also discuss areas of improvement, problems they may be encountering, and ideas for the future. Very often, an employee can be a great source of information in the review process.

You also need to actively investigate the employee's performance and document performance issues. Failure to properly document issues can lead to legal pitfalls because a lack of supporting documentation can make it difficult to prove that performance was poor and warranted discipline. Therefore, your review should be thorough and active with input from as many sources as possible.

While you should have regular reviews, you also should document your employees' performance on a daily basis as needed. If something occurs requiring action on your part with respect to an employee, document your action contemporaneously. It's ineffective and ill-advised to create documents concerning poor performance sometime later. They should be done contemporaneously with the issues and your reaction to the employee's conduct.

Dole out the proper punishment

You need to react appropriately and consistently to the discovery of performance issues and poor performance from your employees. That means you need to inform employees of performance issues and appropriately discipline them if necessary. The appropriate punishment varies with the severity and frequency of the issues involved. Not every incident requires the offender's dismissal, but that doesn't mean termination is never appropriate. If grounds for discharge exist, failure to do so could be construed as approval of the employee's performance.

Obviously, whether to discipline an employee is a difficult decision for you to make as an employer. Nevertheless, the decision must be made and implemented. One of the most difficult issues to defend is a supervisor's failure to punctually discipline a poorly performing employee because he wanted to give her a break.

Discuss performance reviews and issues with managers

You should regularly discuss performance reviews and appropriate discipline of employees with your managers and supervisors. Such discussions can be effective and informative. They will help remind your managers and supervisors about those problems and issues so as to protect you from problems in the future. They will also provide you with insight into your managers' opinions on productivity and their handling of employee-related issues. By discussing those matters, you can keep them fresh in the minds of your managers and continually reaffirm the policy that poor employee performance won't be tolerated.

Remember that usually you will be held liable for the acts of your supervisors. That may be true even if acts or statements were made outside the supervisor's responsibilities and even if the supervisor isn't authorized to make the statements. Thus, you want your managers to understand the purpose of the review process and the way reviews should be conducted.

Moral of the story

Clearly, you don't want to retain an employee who isn't performing in a satisfactory manner. To determine the quality of your employees' performance, it's essential that you have a proper review procedure in place so you can effectively analyze your employees. Such a procedure also provides you with a basis for determining whether discipline against your employees is appropriate and can protect you from legal pitfalls.

Reprinted with permission of publisher. First appeared in Connecticut Employment Law Letter (October 2003). For subscription information, call (800)274-6774.