Employers often face a quandary in dealing with underperformers, and whether to place them onto a performance management program.
It's essential that any such move can always be considered to be 'reasonable management action' in response to inappropriate behaviours or inadequate or unsatisfactory performance, and not simply a way of bullying an employee.
Let's take a look at the difference between performance management and bullying, and how employers can make sure they are not crossing the line.
At some point, every employer will need to manage an underperforming staff member. In practice, this means taking steps to deal with poor conduct, including:
The necessary steps may range from informal performance management, where the inappropriate or unsatisfactory behaviour is brought to the staff member's attention, through to a more formal process such as the implementation of a performance improvement plan.
Employers are not prohibited from dealing with staff that they consider are underperforming. However, care needs to be taken to avoid bullying a staff member, within the meaning of s789FD (1) of the Fair Work Act 2009 (Cth).
That legislation defines bullying as a situation where 'an individual... or group of individuals... repeatedly behaves unreasonably towards the worker, or a group of workers of which the worker is a member, and... that behaviour creates a risk to health and safety'.
The same legislation explicitly excludes 'reasonable management action carried out in a reasonable manner' from the bullying definition.
But what is reasonable management action? Although not an exhaustive list, the following situations constitute appropriate management action within the meaning of the legislation:
When making an objective assessment of the reasonableness of the management action, it is important to consider what caused the action, what circumstances were in train while the action was taken, and what occurred as a result.
It is also important to note that there is no 'retrospective gold standard'. Just because an employer may, in hindsight, have been able to improve on the way they undertook the action, does not necessarily mean that it was not appropriate reasonable action at the time.
Moreover, although the staff member's perception of a negative management action is likely to tend towards it being unreasonable, the standard is objectiveness and this is not determined by one or a group of employees' views.
Unsurprisingly, the question of what constitutes reasonable management action is one which is frequently litigated in court.
In the decision of Commonwealth Bank of Australia v Reeve  FCAFC 21, it was determined that a manager's day-to-day instructions were not enough to constitute 'management action'.
In National Australia Bank Limited v KRDV  FCA 543, the court considered that although the employee was spoken to about her performance in both a formal Action Operation Management meeting and in a 'casual chat', the two meetings were not sufficiently clear as performance-related discussions to constitute reasonable management action.
Practical tips for compliance include:
Performance management is part of maintaining a successful business. However, if you receive complaints regarding your performance management approach, and want to ensure that you are complying with best practice and acting in a fair and reasonable manner, contact WISE for assistance and advice today.
WISE Workplace is a multidisciplinary organisation specialising in the management of workplace behaviour. We investigate matters of corporate and professional misconduct, resolve conflict through mediation and minimise the impact of inappropriate behaviour through our whistleblower services.
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