Performance Improvement Plans often lead to Settlement Agreements. But what are they, and what are your rights?
What are Performance Improvement Plans?
Performance Improvement Plans (also commonly referred to as “PIP’s”) are used by employers as a means of tackling poorly performing employees and can lead to the dismissal of an employee on capability grounds. It is often, therefore, seen as a tactical step by an employer to reduce any risks to subsequent claims for unfair dismissal from employees.
What happens when you are placed on a PIP?
In the first instance, you should be informed of the PIP in writing and you should be asked to agree and sign the document. The PIP should clearly set out the areas in which you have been failing. It should further specify the improvements that are expected of you, including measurable objectives as well as the time frame within which you should achieve your targets. It should also set out the frequency of reviews, any support or training that will be provided and the consequences of failing to achieve your targets.
Employees on PIP’s usually find that they are subjected to strict targets of improvement which are usually set to be achieved in a short period of time. The targets can often be seen by such employees to be unreasonable in nature and equally, unattainable. If you have been subjected to a similar PIP, you might question the reason behind which you were placed on a PIP. This might give you an indication as to the real reason for the PIP and allows you to prepare for the possible outcomes.
What are the options available to you?
At the first opportunity, you should seek legal advice if possible. It is sometimes common for employees to seek legal advice at the later stage of a PIP and near to their dismissal. Although it is not too late to obtain a settlement for such employees, it can sometimes make it difficult to negotiate and obtain an optimum settlement.
You do not have to agree to being placed on a PIP. However, you would need to formally challenge it by lodging a grievance, and if necessary appeal the decision. If you are being put under pressure to sign the PIP, you may wish to clarify that you are signing under protest.
You may wish to approach your employer in the first instance to straighten out any misunderstandings or issues which have seemingly led to the PIP. This may alleviate tensions between you and your employer and out into context the PIP.
If you no longer wish to remain in employment – indeed it can sometimes be difficult to maintain an employer/employee relationship when it is clear that your employer wants you out – you might want to consider the exit route in the form of a settlement agreement. In some circumstances, this can allow you to obtain a settlement/severance package as well as a reference. However, by signing the agreement, you are agreeing to give up the right to issue any claims against your employer in the future. Claims for personal injury and pension rights are usually excluded from the agreement.
If you have already left employment and realise that the PIP and your subsequent dismissal was not fair, you may wish to issue at claim at the Employment Tribunal for unfair dismissal. You will have to do so no later than 3 months less on day from your last day of employment.
Being placed on a PIP can affect the most hardworking and diligent of employees. For this reason, it is important to recognise the early signs of a potential dismissal. This will allow you to understand the possible outcomes that you face. It can allow you to defuse this tactical device and in doing so, can offer you the possibility of walking away with a lump sum and a clean reference.