Managing substandard performance

Employee coverage

The guide covers staff referred to under s.76 of the Public Sector Management Act 1994
(PSM Act). The information may be used as a guide only for staff employed outside of the Act.

Substandard Performance

Section 79 of the PSM Act defines substandard performance to be if the employee does not, in the performance of the function that he or she is required to perform, attain or sustain a standard that a person may reasonably be expected to attain or sustain in the performance of these functions. Other definitions of substandard performance may exist in other legislative and industrial instruments that apply to employees not covered by Section 79 of the PSM Act.

Identifying Substandard Performance

A systematic and objective approach should be taken to measure the employee’s performance against the work requirements. This process should clearly identify objective and specific skills, competencies or behaviours that are necessary to meet the requirements of the position. Reference can be made to formal job descriptions and any other written job instruction when making this assessment.

Results of Substandard Performance

If an employee’s performance is in the opinion of the employing authority found to be substandard, s.79 (3) of the PSM Act states an employer may:

a) Withhold for such period as the employing authority thinks fit an increment of remuneration otherwise payable to that employee; or

b) Reduce the level of classification of that employee; or

c) Terminate the employment in the Public Sector of that employee.

Performance Appraisal

Performance appraisal’s give managers and employees the opportunity to discuss the employees performance. This gives the opportunity to raise issues and develop strategies to address performance based issues. This should be undertaken for all employees as part of the performance management process.

Resolving disagreement

Under s.79 (5) of the PSM Act, where an employee does not admit to their performance being substandard, the employing authority is required to conduct an investigation into whether or not the performance of the employee is substandard.

Causes of substandard performance

There are a range of factors that may contribute to and result in substandard performance. Some may be attributed to the employee, while others may stem from environmental or organisational factors. Identification of the cause and strategies to combat substandard performance should be identified and acted upon in a timely fashion to remedy the situation.

Improvement plans

The parties may agree to improve and address substandard performance with an improvement plan. The plan should contain performance objectives, as well as specific strategies to improve performance. An appropriate period for review of progress should also be noted against the performance objectives.

Importance of managing performance

Performance management will form the basis for any decision to commence a substandard performance process. A consistent approach that treats all employees equally and fairly will assist in reducing claims of bias and bullying by management.

Addressing substandard performance

In addition to ongoing performance management including the use of appraisals and performance improvement plans, strategies to improve substandard performance include:

a. Further training, whether formal or informal

b. Mentoring by a manager or a colleague skilled in tasks in the employees field

c. Work shadowing and observation

d. Flexible work practices.

Objectives of substandard performance investigations

The objective of an investigation is to accurately and fairly assess the performance of the employee against the requirements of the role. To achieve this, the investigation must show regard has been given to the considerations set out in s.79 (2) of the PSM Act and ensure that the rules of procedural fairness are observed at all times.

Investigation Process

It is important that an objective and fair assessment of the employee’s performance occurs. An investigation may include:

a. A compilation of relevant documentary evidence concerning the employees performance.

b. Provision of sufficient information to the employee to provide an explanation as to why they believe the employee’s performance is substandard.

c. Give the employee a reasonable time frame to respond to the claims.

d. After due consideration, the issue of a formal opinion by the employing authority as to whether the employee’s performance is substandard.

Performance management standard

The performance management standard is the minimum standard to be followed by employing authorities in addressing the performance of employees. While the standard applies to performance generally it does not specifically apply to any decisions made in relation to substandard performance.

Procedural fairness

Procedural fairness concerns rules of common law relating to how a decision maker should act when making decisions to ensure a fair and equitable process. Specifically this involves acting without bias, giving the employee a reasonable opportunity to respond to allegations against them and ensuring decisions are evidence based. Procedural fairness must be upheld during the substandard performance process.

Process for staff employed outside the PSM Act

The legal and policy framework is generally found in other legislation, common law, industrial awards and instruments relevant to the employee’s employment with the organisation. Many of the principles and processes outlined in this guide may be relevant and can be applied if not in conflict with the specific legislation and awards applicable to those employees.