Staff Performance Management

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What is Staff Performance Management?

Staff performance management can be defined as the process of assessing progress toward achieving predetermined goals, adding relevant communication and action on the progress achieved against these predetermined goals.

Employment Law Services (ELS) can help your business create and implement a robust performance management system that is strategic, integrates various aspects of the business, and incorporates Performance Improvement, Learning and Development, and Managing Behaviour and Capability in an effective and legally compliant way.

Manage Staff Performance & Capability Issues – the Law

In an increasingly competitive environment, employers are particularly conscious of the need to recruit members of staff who are capable of delivering results when performing their duties. Performance management is an increasingly common tool used by employers to assess the ability of their staff in fulfilling their duties efficiently and effectively.

Staff Performance Management

At ELS, we are regularly asked to assist employers with designing performance management schemes that allow them to identify how well employees are contributing to the success of their business. It is important that this process is carefully crafted, not only so that any potential deficiencies can be identified and addressed, but also so that it is fully compliant with employment law. If you would like to know more, our employment law advisory service for businesses in the UK can help.

Managing Staff Performance Legally – How does Performance Management work?

Performance management schemes vary in the way that they are designed from one employer to another, but generally speaking, they should be based on the following set of criteria:

  • Agreeing with employees on the objectives they will be expected to meet when performing their duties
  • Establishing the competencies that employees should develop in order to meet the objectives that coincide with their role within an organisation
  • Provide opportunities for employees’ personal development to contribute to their meeting employer expectations

It should be stressed that performance management is a process. Employees’ behaviour and work should be assessed over an extended period of time. It is not uncommon for employers to implement a performance management process involving multiple stages, often over the course of a year. Typically this will involve:

  • Regular informal meetings
  • Formal meetings at scheduled points
  • Annual review/appraisal

This three-pronged approach to performance management allows for time to identify objectives that employees are expected to meet while also providing multiple opportunities for managers and employees to enter into a dialogue on progress and identify instances where support or employee development is needed or warranted.

When can Performance Management go wrong?

Performance management, when used properly, can be of immense practical benefit to employers and employees alike. It allows the business to benefit from the contribution of their staff, and affords employees every opportunity to develop themselves and their careers. However, there is a risk that a performance management process, if not designed properly and handled appropriately, could result in the relationship between employer and employee being severely damaged.

Vital components of an effective performance management system include:

  • The system must be based on objective criteria that are clearly defined – employees must be able to recognise what is expected of them and appreciate where they may be failing to meet those expectations;
  • The process must be supported by the necessary framework – a significant aspect of performance management is the identification of gaps in employee skills, and affording opportunities for these gaps to be filled by adequate training; and
  • Performance management must be handled by experienced personnel – administering a performance management scheme is difficult, and must be handled by those who understand the nature of the roles within the business and how to engage with employees effectively.

The danger of using a system that fails to observe these points is that irreversible damage can be done to the employment relationship. Indeed, it is possible that legal action can be brought against employers who do not observe a fair and objective process that results in employees being treated unfairly.

Performance management is a two way process: employers use it to identify employees’ needs and offer development opportunities, and employees use it to enhance their skills and contribution to the business. It is advisable that this message be communicated in all businesses that utilise a performance management system, thereby increasing the likelihood that it will be effective and of benefit to the business at large.

 

How can Employment Law Services (ELS) help?

At Employment Law Services (ELS), our experienced employment law and HR advisors routinely assist employers across a range of industries to design and implement performance management systems. We use our knowledge, with many of our team recognised as experts in the field, to advise employers on implementing effective, legally compliant performance management systems that contribute to the success of their business. We operate across the central belt of Scotland and throughout England, providing a bespoke service to the SME sector. If you would like to know more about how we can help you, speak to our team today.

The provision of a Performance Management system is included as standard in our fully outsourced HR Services package. For companies that do not subscribe to our fully outsourced HR Services package, we can certainly still provide a Performance Management System but would deliver it as a ‘project’.

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Staff Performance Management - Frequently Ask Questions

We have answered some of the most common questions asked below but if you still cannot find the answer you need then give us a call on 0800 612 4772

Managing staff absence is a key responsibility for employers in the UK, as it directly affects productivity, workplace morale, and legal compliance. Below are some frequently asked questions to help employers effectively handle staff absence.

Staff absence refers to any period when an employee is not at work during their scheduled working hours. This can include sickness, annual leave, maternity or paternity leave, unpaid leave, sabbaticals, and unauthorised absences.

For short-term sickness absences:

  • Ensure employees follow your company’s sickness absence reporting procedure (e.g., notifying their line manager on the first day of illness).
  • For absences of 7 days or less, employees can self-certify.
  • For absences longer than 7 days, a doctor’s fit note is required.
  • Record the absence and monitor any patterns of frequent short-term absences.

For long-term sick leave (usually 4 weeks or more):

  • Stay in regular contact with the employee to offer support and get updates on their health.
  • Request a fit note from a doctor and, if necessary, seek further medical advice (e.g., an occupational health assessment).
  • Discuss a phased return to work or reasonable adjustments to help the employee return to work.
  • Be aware of your obligations under the Equality Act 2010, particularly if the employee’s condition qualifies as a disability.

Statutory Sick Pay (SSP) is the legal minimum payment made to eligible employees who are off work due to illness for 4 or more consecutive days. Employers must pay SSP for up to 28 weeks, at a rate set by the government (currently £109.40 per week in 2024). To qualify, employees must:

  • Be classified as employees.
  • Earn an average of at least £123 per week.
  • Follow the company’s notification procedures.

Employers can offer more generous sick pay through occupational sick pay schemes.

Unauthorised absence occurs when an employee fails to attend work without a valid reason or permission. To manage unauthorised absence:

  • Investigate the cause of the absence and speak with the employee as soon as possible.
  • Use a return-to-work interview to understand the reasons behind the absence.
  • If the absence continues, follow your disciplinary procedures, ensuring you remain fair and consistent.
  • Keep records of all instances of unauthorised absence.

A return-to-work interview is a brief meeting held after an employee has been absent due to illness. Its purpose is to:

  • Welcome the employee back and check on their well-being.
  • Discuss the reason for the absence and ensure the employee is fit to return.
  • Identify any patterns of frequent absences.
  • Address any ongoing concerns or potential adjustments needed for the employee’s health.

This interview helps ensure absences are managed fairly and consistently, while supporting employees.

Employees in the UK are entitled to various types of family leave, including:

  • Maternity Leave: Up to 52 weeks, with Statutory Maternity Pay (SMP) for up to 39 weeks.
  • Paternity Leave: Up to 2 weeks paid leave.
  • Shared Parental Leave: Eligible parents can share up to 50 weeks of leave and 37 weeks of pay.

You must allow eligible employees to take these types of leave and ensure their employment rights (e.g., pay, pension contributions) are protected during the leave.

If an employee has frequent or long-term absences:

  • Review their absence record to identify patterns.
  • Hold a formal absence review meeting to discuss concerns and understand any underlying issues.
  • Offer support, such as occupational health assessments, counselling, or flexible working.
  • Where necessary, implement an Attendance Improvement Plan with clear targets.
  • If absences continue, consider moving to disciplinary action but ensure you follow legal procedures and consult medical advice if applicable.

A fit note is issued by a GP or medical professional to certify an employee’s illness when they are off work for more than 7 days. The fit note may:

  • Confirm that the employee is not fit for work.
  • Suggest that the employee may be fit for work if adjustments are made (e.g., reduced hours or duties).

Employers should consider any recommendations on the fit note and determine whether adjustments can be accommodated.

If an employee refuses a reasonable adjustment recommended by a fit note or occupational health assessment:

  • Discuss the reasons for their refusal and explore any additional concerns they may have.
  • Ensure the adjustments offered are reasonable, taking into account their health condition and the business’s ability to accommodate the changes.
  • If the employee continues to refuse, seek advice from HR or a legal expert to ensure you are managing the situation lawfully, particularly if their condition may qualify as a disability under the Equality Act 2010.

Dismissing an employee due to absence can be risky if not handled properly. To avoid unfair dismissal claims:

  • Follow a fair and thorough absence management process.
  • Obtain medical evidence to support any decisions.
  • Ensure you’ve explored reasonable adjustments if the absence is related to a disability.
  • Document all communications and steps taken. If the absence is due to a protected characteristic, such as a disability or pregnancy, additional legal protections apply.

It’s essential to keep accurate records of staff absence, including:

  • Dates and reasons for absence.
  • Self-certification forms and fit notes.
  • Return-to-work interviews.
  • Any discussions around adjustments or support provided. Use an HR system or a structured process to monitor absence patterns, identify trends, and ensure compliance with company policies.

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