We are frequently asked, “What is a performance improvement plan?” Below, we address this question and give guidance if you have been placed on a Performance Improvement Plan UK.
Being placed on a performance improvement plan (or “PIP”) can be a very difficult and stressful experience. Many of our clients come to us shortly after being presented with a PIP. We see performance improvement plans frequently and find they are usually used in one of two ways, (1) to genuinely improve the employee’s performance or (2) used as a mechanism to push the person out of the business (and if that does not work, to create a paper trail to justify dismissing the employee).
Unfortunately, the latter use is common.
What Is A Performance Improvement Plan?
A performance improvement plan is a process used by employers to improve an employee’s performance at work. It is therefore also a process where the employer is alleging the employee is not working at a satisfactory standard. The process is often set out in the employee handbook or a separate “capability” process. If you have at least 2 years’ continuous service as an employee, your employer can only dismiss you if it has a “fair” reason. One of the fair reasons in law is “capability,” which covers performance.
What Should A PIP Include?
This should be set out in the handbook or capability process. Generally, a PIP is set out in writing and should include:
- Areas requiring improvement, stated objectively with examples.
- Using measurable objectives, set out the level of improvement expected.
- Provide a timescale for when the improvement is expected to be achieved.
- Set out the frequency of any review meetings.
- Outline any training or support to be provided.
- Make clear what will happen if you fail to meet the required standard (such as dismissal).
The employer may present you with a performance improvement plan in writing and ask you to acknowledge and accept the proposal.
If you find the PIP or process unfair, avoid agreeing to it in writing or verbally.
Get In Touch
If you are going through a Performance Improvement Plan and need help, then please call us now on 0207 118 9218 for a Free And No Obligation Discussion about your options.
What Should I Do If Given A Performance Improvement Plan?
In most cases, you should:
Stay employed, seek advice, act quickly.
This will cover most bases and the advice can cover your options. You should take advice quickly to prevent any mistakes being made and to make an informed decision on how to react.
Even if you think the PIP is unfair / prejudicial, simply resigning is rarely a smart move. If you simply resign, you will be opting to be unemployed without an income and it may infer / can be argued by the employer you resigned because the criticism to your performance was justified. Even if you want to leave the business, going through a PIP is often a convenient segway to negotiate an exit, where you can leave on your terms (with tax-free compensation, a reference, your reputation protected).
Should I Sign The Performance Improvement Plan?
We have mentioned this above, but if you have been given a PIP (particularly if you think its unfair), you should:
Stay employed, seek advice, act quickly.
When taking advice, you can ask questions, to include, whether the PIP should be signed.
Not all employers ask for PIPs to be signed / agreed. However, in general, if you are asked to sign a PIP that you feel is unfair, then you should not agree to sign it, as this may hamper your opportunity to challenge it later. If you are not agreeing to sign the PIP, you should set out (politely and professionally) the reasons you feel it is unfair, which is why you are not prepared to sign it.
Even if you are not asked to sign the PIP, you should still review it carefully and set out the reasons why it is unfair. There is likely to be opportunities at PIP review meetings to explain your objections to the PIP.
PIP – The Significance of Two Years Service
To be eligible to claim unfair dismissal, you must have been continuously employed for at least 2 years. Therefore, if you have less than 2 years service, then if you are dismissed, you cannot claim unfair dismissal (there are exceptions to this rule, see unfair dismissal – under 2-years).
If the PIP is being handled badly, this may also give rise to constructive unfair dismissal, but again, only if you have at least 2 years continuous service as an employee. Further, an employer not following a fair PIP process is often relevant to any unfair dismissal claim (if the PIP ends with a dismissal), but again, this may only be relevant if the employee has at least 2 years’ continuous service.
The use of performance improvement plans tend to be more common for those with more than 2-years of service, but they are also used on employees with less than 2-years service. The main legal significance is the types of claims that may be available. As referenced, there are claims that do not require 2 years service, such as discrimination claim (please see Navigating Performance Improvement Plan – Disability).
How Do I know If The Performance Improvement Plan Is Unfair?
When discussing PIPs with clients we often explain they are either used to improve performance or to push a person out of a business and they already have a strong sense of how it is being used, but it is not always obvious. Some common clues that a PIP may be used unfairly are:
- A deviation from the company policy. If the employer fails to follow its written policy on the process, this may indicate that the PIP is not being used to improve performance.
- The terms of the PIP. If the areas to improve are not clear or subjective (or the expectations are unrealistic) this is another common clue. This usually related to the targets/timeframes in which improvement is expected. If the PIP is extremely difficult to pass, then it infers it is being used to push you out / set you up to fail.
- The PIP closely following a separate issue. If the PIP comes out of the blue, and there are no genuine performance issues, but it follows another incident at work (such as you raising a complaint), this may infer the PIP was in fact retaliation to your complaint as opposed to genuinely being used to address performance issues.
- Being singled out. If you work in a team and you are the only person facing a PIP without any clear differences in performance, then this may indicate that the PIP is being used unfairly.
- To avoid redundancy. If you can see a reduction in work, you may have been fearing redundancy, to then be placed on a PIP (it is often cheaper to dismiss via performance than redundancy).
- Relationships at work. If there are relationship issues at work, for example with your manager, a PIP may be used to push you out of the business as an alternative to addressing the actual issue (the relationship with your manager and not your performance).
What Are My Options If I Am Put On A Performance Improvement Plan?
The main options stem from whether you want to stay employed by the Company or if you would prefer to (or are open) to leaving. If you prefer to stay, your main option is usually to face the PIP head-on and work to meet its requirements. However, if you are unsuccessful, the end result me be dismissal. Being dismissed for capability can be difficult to recover from and it may be more difficult to get a new job.
Negotiating an exit
The other option would be to negotiate an exit via a settlement agreement. Rather than risk not passing the PIP, you would seek to exit the business, looking to secure tax free compensation, a reference, and keeping your reputation intact. The key advantages of negotiating an exit are:
- Rather than risk being dismissed, you seek to leave on your terms.
- You avoid going through the PIP, which is often stressful.
- Financial compensation.
- You can secure a reference before you leave.
- Damage limitation to your reputation.
- Easier to get alternative employment.
Get In Touch
If you need help with a Performance Improvement Plan, please call us now on 0207 118 9218 for a free, no-obligation discussion about your options
Frequently Asked Questions (FAQ) About Performance Improvement Plans (PIPs)
1. What is a Performance Improvement Plan (PIP)?
A PIP is a structured process used by employers to help employees improve their performance. It often includes clear objectives, timelines, and support measures. However, PIPs can sometimes be used as a way to push an employee out of the business or to dismiss them if performance does not improve.
2. What should be included in a PIP?
A PIP should include:
- Specific areas for improvement with examples.
- Measurable objectives for improvement.
- A timeline for achieving improvements.
- Frequency of review meetings.
- Any support or training to be set out.
- Consequences if the performance does not improve, such as potential dismissal.
3. Should I sign the PIP if I think it’s unfair?
If you believe the PIP is unfair, avoid signing it right away. Politely and professionally communicate your concerns in writing, explaining why you feel the plan is unreasonable. You may want to seek professional advice before signing or agreeing to any terms.
4. What should I do if I am put on a PIP?
If you are put on a PIP, it’s recommended to stay employed, take professional advice, and act quickly. Resigning immediately is usually not advisable, as it can imply that you accept the performance criticisms and you may lose the opportunity to negotiate a more favourable exit. By remaining employed, you may also have the option to negotiate an exit on favourable terms.
5. How do I know if a PIP is being used unfairly?
Signs that a PIP may be unfair include:
- Deviations from company policy in implementing the PIP.
- Vague or subjective criteria for improvement.
- Unrealistic performance targets or timeframes.
- A PIP initiated after unrelated issues, like a workplace complaint.
- Being singled out without clear performance differences among colleagues.
- Being placed on a PIP instead of going through a redundancy process.
6. What are my options if I don’t want to go through the PIP?
If you prefer not to go through the PIP, one option is to negotiate an exit with a settlement agreement. This can include compensation, a positive reference, and protection of your reputation, allowing you to leave the business on your terms.
7. Can I claim unfair dismissal if I am dismissed after a PIP?
To be eligible to claim unfair dismissal, you need at least two years of continuous service as an employee. If you do have two years’ service, an unfairly handled PIP process may amount to an unfair dismissal (you need professional advice to be sure). However, if you have less than two years’ service you cannot claim unfair dismissal or constructive unfair dismissal, but other claims may apply.
8. What if I want to stay and complete the PIP?
If you decide to stay, approach the PIP process with a positive attitude and work toward meeting the specified goals. Successfully completing a PIP can help you retain your role and demonstrate your commitment to improvement. The main risk is being dismissed on performance grounds.
9. What should I avoid when on a PIP?
Avoid signing or agreeing to anything without fully understanding the terms, taking documents from work systems that you aren’t authorised to access, or resigning without consulting an advisor. These actions can negatively impact your position.