How to Terminate an Employee for Poor Performance

How to Terminate an Employee for Poor Performance

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Introduction

Terminating an employee is never pleasant, but sometimes it's necessary. Yet, before you terminate an employee for poor performance, you must ensure you follow the proper procedures. When dealing with foreign workers, providing supporting documentation is particularly important.

Here's a guide to firing someone for poor performance.

Termination of Employment Contracts

An employment contract makes it more difficult to fire an employee, regardless of whether the agreement is written, verbal, or implied. Every country has its regulations regarding termination, but most allow you to terminate an employee for "just cause."

If you're wondering how to terminate an employee without cause, you may only be able to do so in the US. In the US, many states consider employment " at will," which means organizations can fire employees for any reason that isn't federally protected, such as gender, race, or religion. You don't need to provide an explanation or prove cause otherwise unless the employee has an employment contract. However, you may need to determine if your employee has an employment contract.

In most foreign countries, employment contracts govern employee/employer relationships. The contract is implied even if it isn't stated. In the US, if you don't have an expressed written agreement, there may be an implied contract.

Each country may have a different definition of "just cause" for terminating an employee, but some common reasons include the following:

  • Not performing their duties as required
  • Insubordination, such as not following legal orders
  • Misconduct
  • Theft or other criminal behavior

Before you fire an employee with an employment contract, check the applicable labor laws in their home country to determine what constitutes just cause and what documentation you need to prove it.

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Reasons for Termination for Poor Performance

One employee's poor performance not only limits your organization's effectiveness but also demoralizes your productive employees. However, everyone has their off days — and no one enjoys firing an employee — so it can be challenging to know when you should terminate an employee for poor performance.

Poor performance is usually related to the performance of an employee's duties, but it can also result from a negative attitude or excessive absenteeism. There are many different types, such as:

Job-Related Poor Performance

Job-related poor performance can be unintentional or intentional, including:

  • Making mistakes
  • Missing or ignoring deadlines
  • Botching instructions
  • Not responding to feedback

Behavior-Related Poor Performance

Behavior-related poor performance may include:

  • Being too loud
  • Socializing too much during work hours
  • Frequently coming in late or leaving early
  • Being rude to coworkers
  • Being disrespectful to management

The Process Involved in Terminating an Employee for Poor Performance

The best time to address poor performance is when you first notice it. While you shouldn't send an immediate termination letter to an employee for poor performance, you should address it. If you notice an employee is starting to have performance issues, you should schedule a meeting and discuss it. Don't wait until a performance review that's not due for another few months.

Before discussing poor performance with an employee, consider whether factors outside of their control may affect their performance. Some things to consider include the following:

  • Is their workload too heavy?
  • Do they clearly understand their duties?
  • Do they have access to objective performance measures, such as KPIs?
  • Are their targets unrealistic?
  • Do they have the support they need to do their job effectively?

Address any outside issues that could hinder good performance before you consider terminating an employee. You can measure their performance by providing those components if they need more training or support.  

For employees who have enough support, clearly understand what's expected of them, and know they're falling short, the next step is to formally discuss the issue and the consequences if they don't improve their performance. Let the employee know their performance is below standard, what they need to improve, and how it will be measured. At this point, drawing up an official performance improvement plan and having the employee sign it is a good idea.

Continue to document the employee's performance. You want proof that the employee was not performing well was given ample opportunity and support to improve, and failed to do so. This will help you prove that you have cause to terminate the employee. If the employee fails to improve, you'll be justified in terminating them for poor performance.

Performance Improvement Process

During your meeting with an employee about poor performance, you should create an action plan for performance improvement. This plan will let them know exactly where they're falling short and how they can improve. It should have measurable goals and a timeline for improvement.

An action plan goes beyond a promise to do better by clearly laying out measurable objectives. With a good action plan, you and the employee can tell if their performance has improved to acceptable levels.

The performance improvement action plan should include the following:

Description of the Problem

Be clear and specific when defining the problem. The more precise you can be, the easier it will be to evaluate and measure progress.

Objectives for Improvement

Set one to three measurable goals for improvement. Again, these should be as specific as possible, so your employee will know if they've improved and what they must do to improve.

Metrics for Improvement

Let the employee know what metrics will determine if they've improved. These may have to do with job performance or behavior, but they should be clearly defined.

Deadlines

Include deadlines for the employee to meet their performance objectives. Meet with the employee after the deadlines to discuss their progress. Document all details related to these meetings.

Support

Include information about where the employee can find support and resources to help them improve, including the manager's role in the performance improvement action plan.

Communicating about termination

If your employee hasn't improved according to the performance improvement action plan terms, you're justified in terminating them. At this point, the employee should be reassured about the termination.

Gather Your Documentation

Get all of your information together before scheduling a meeting with the employee, including:

  • Records of warnings
  • The performance improvement action plan
  • Other documentation relating to poor performance
  • Information about how their benefits will be handled, discontinued or rolled over
  • A separation checklist that includes any property that needs to be returned
  • Termination letter and severance letter, if applicable

Write a Termination Letter

Many countries require a termination letter when you're firing an employee. Even if it isn't a legal requirement, it is always a good practice. A termination letter should include the following:

  • Basic information about the employee, such as name, ID number, and position
  • The reason for the termination
  • Information about accrued and unused leave time, including if and how you will pay it
  • Information about their final paycheck and severance pay, if applicable
  • How their benefits, such as health insurance and retirement savings, will be handled

Don't Schedule a Meeting

Although it's a common practice to schedule a meeting with an employee to terminate them, it may serve a poor purpose. When you're ready to terminate them and have all of your documentation, ask them to meet with you immediately. Hold the meeting privately, briefly discuss the reasons for their termination, and give them the termination letter. Then escort them off the premises quietly and with dignity if they're working on-site.

While responding to questions is fine, don't let the meeting drag out. It should be 15 to 20 minutes since it shouldn't be a surprise. If your performance improvement action plan was clear, the employee knows they didn't meet improvement objectives, and that termination is the consequence.

Be compassionate and professional, but don't apologize. Your message should be that the employee is being terminated because they can't meet the job requirements. Don't imply that someone else, such as a man or younger person, could do the job better, or you may open yourself up to a discrimination lawsuit.

Although it may seem more straightforward, don't terminate an employee via text or email. Plan an in-person meeting if they're working on-site or a virtual appointment; it isn't possible if they work remotely when meeting in person.

Inform the company

Once the employee has been terminated, let their direct manager know and inform them how the employee's duties will be handled if you have yet to find a replacement. You should also notify the HR department so they can cease paying them, unenroll them from benefit programs, and handle other administrative issues.

Terminate employees with Skuad by your side

One of the main advantages of hiring internationally is that you can access the best talent in the world. However, after repeated opportunities to improve, employees who need to perform up to standard will bog down your company's growth and progress. Although terminating an employee is unpleasant for everyone involved, it will be easier if you handle it in a kind and professional manner. Provide your employees with clear, constructive feedback and give them a chance to improve their performance.

If they still aren't able to do the job, follow the correct procedures in their home country for terminating them so that you'll be legally protected. At Skuad, we can help you with all aspects of managing your global team, including termination procedures. Reach out to our team of experts to find out how we can help you grow internationally.

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