Performance improvement plan for a poor performing employee

Employees who are underperforming may be dismissed. However, they must first be given the opportunity to improve their performance through a performance improvement plan (PIP). What requirements must such a plan meet?

An employee is not performing to your expectations. You may have already raised this issue, but without the desired result. This is unfortunate, not only for the working relationship with colleagues, but also for the progress of the work and the efficiency of the organisation. What can you do as an employer in such a situation?

Poor performance

In Dutch employment law, poor performance constitutes reasonable grounds for dismissal. However, before you, as an employer, can actually proceed with dismissal, strict conditions must be met. The employer must be able to demonstrate that:

• the employee has been informed of the poor performance in a timely and clear manner;
• the employee has been given sufficient opportunity to improve their performance (usually through an improvement plan);
• the poor performance is not the result of illness or a disability of the employee;
• the poor performance is not due to insufficient training or insufficient care for the working conditions by the employer;
• reassignment within a reasonable period of time, with or without training, is not possible in another suitable position.

In this blog, we will take a closer look at the improvement plan. This plan is not only intended to support an employee in improving their performance, but in practice it is also an (almost) mandatory step before an employer can proceed with dismissal on the grounds of poor performance.

Requirements for a performance improvement plan

The Supreme Court has ruled that, partly in view of the requirements of good employment practices, an employer must offer the employee a serious and realistic opportunity for improvement. The help, support and guidance that can be expected from the employer depends on the circumstances of the case. The following factors, among others, play a role in this:

• the nature and level of the position;
• the employee’s education and experience;
• the nature and severity of the poor performance;
• the length of employment;
• the efforts already made;
• the extent to which the employee is open to criticism and actively committed to improvement.

What does this mean in practice?

A careful improvement process will in any case involve the following steps:

• Draw up a written improvement plan.
• Clearly identify the cause of the poor performance.
• Set a realistic deadline for improvement. In the case of long-term employment, this could be a period of six months, for example. In practice, an improvement process usually lasts between three and six months, depending on the position and the length of service.
• Formulate concrete, achievable and job-specific objectives that the employee must achieve. Clearly define the level of performance expected of the employee.
• Regularly evaluate progress, discuss the interim results with the employee and record these evaluations in writing (file building).
• Offer sufficient active guidance and support. This could include coaching, training, courses or other forms of education. Also ask the employee explicitly where they need this support.

Purpose of PIP and transparency of consequences

The primary purpose of a PIP is to improve performance, not to directly dismiss the employee. Good guidance, regular evaluations and careful file building are essential, both for the employee and to limit legal risks for the employer.

In addition, ensure that the employee can record their views and responses in writing, for example in response to interim evaluations within the improvement process.

Finally, transparency is crucial. Be clear about the possible consequences of not achieving the objectives of the improvement plan. Make it explicit that insufficient improvement in performance can have serious consequences for the employment relationship. By communicating openly and honestly, both parties know where they stand.

Employment lawyer

Would you like to know more about the improvement process for underperforming employees, or do you need help drawing up a PIP? We will be happy to assist you. Please contact us: