Top 10 tips for dealing with an underperforming employee

Moira Grassick - Chief Operating Officer

May 29 2023

First published: November 23rd 2021
Last updated: May 29th 2023

Poor employee performance affects both the worker and your wider business. Underperforming employees can have a domino effect. When colleagues see one employee slacking, their own motivation can decrease.

In some cases, an employee may be genuinely trying but is simply not capable of hitting their targets or meeting your business’s standards.

Other employees may be more than capable but lack the motivation to hit their targets.

How to manage a poor performing employee begins with figuring out which type of employee you’re dealing with.

If you find yourself dealing with an underperforming employee in your business, the following 10 steps will help you manage the problem.

10 steps for dealing with underperforming employee

1) Know what you want from the employee

If an employee is underperforming, you should first be clear on what level of performance you want and consider if the relevant standards have been properly communicated to the employee. If either party isn’t aware of the required standards, confusion is unavoidable.

2) Begin with an informal approach

When you’re addressing a performance issue for the first time, approach it informally by having a conversation with the underperforming employee. This doesn’t mean that the issue goes unaddressed, it simply means that no formal disciplinary action will be taken at this stage. Approach this conversation with an open mind and empathise with the employee if their issue is a personal one.

3) Let the individual know that you have concerns

The first practical step is to let the employee know that you have concerns with regard to their performance. This should be done in a private conversation with the employee. This isn’t a formal hearing, so there’s no need to formally invite the employee with notice. Again, it’s best to approach this conversation in a personal, friendly manner.

4) Identify the problem

Enquiries should be made as to the reason for the employee’s underperformance. This is necessary to establish what subsequent action you need to take. If they have the capacity to perform better but simply choose not to, then they should be told that they must improve.

If it’s their ability to do the job (they’re trying hard but still can’t perform well) that’s the problem, then you should identify how you can help them, e.g., further training/supervision.

If the reason is health-related, it may be necessary to obtain an expert medical opinion. If they have a disability, reasonable accommodations to the workplace may need to be considered.

5) Refer to further consequences

Although you’re dealing with the issue informally, you should let the employee know that, should they show no signs of improvement, you may need to begin a formal disciplinary procedure.

6) Monitoring

Keep tabs on the employee’s subsequent performance. The level of monitoring required will need to be considered on a case-by-case basis. The employee is unlikely to appreciate an overbearing level of scrutiny as they seek to improve so handle this aspect sensitively.

7) Revisit

If the employee’s performance doesn’t improve, or there’s a temporary improvement followed by another dip, revisit the issue. Speak to the employee again, pointing out that your previous discussion, and/or any help provided, doesn’t appear to have had an effect. Again, ascertain what the reasons are.

8) Formal procedure

If no sufficient improvement or explanation is provided, you should consider implementing a formal disciplinary or capability procedure with the employee. Formal disciplinary processes must follow the steps set out in your written policies. It’s vital that this process follows fair procedures and the principles of natural justice. Employees should be formally invited to these hearings, informed of their rights like the right to be accompanied, the right to state their case and the right to appeal any decision that goes against them.

9) Complete the process promptly

In more general terms, you should deal with the process efficiently ─ don’t allow the issue to drag on. Where you have prescribed timeframes in your procedures, stick to them.

10) Consistency

Act in accordance with previous cases of a similar nature to ensure a consistent approach in terms of assistance provided, or if appropriate, sanctions issued.

In addition to these tips, you need to communicate clearly with any employee who is going through a disciplinary process and keep good written records of all the steps you have taken to address the issue.

Managing Underperforming Staff guide

For guidance you can take with you, download our Managing Underperforming Staff guide which covers essential areas such as:

  • Policies on managing performance.
  • How to address underperformance with an employee.
  • Proceedings you can take and how to conduct a capability hearing.

Download the free Managing Underperforming Staff guide today.

Get expert HR advice on managing underperforming employees

For instant advice managing underperforming employees, speak with one of our expert HR consultants today on 1800 719 216

Suggested Resources