Earlier this week my good friend flew in with his family from Arizona (it’s unclear why they chose the Oregon winter over the Oregon summer to visit). The morning after their arrival, we went on a walk to get donuts and talk about work. After he finished sharing the stressors in his life (the rat race of sales), he inquired about the areas of work that make me feel empathy toward employers. I stopped, paused, and said PIPs. He rolled his eyes and said, “Ya I know we are at Pip’s Donuts; tell me about work.” I said, “No, there is a stigma that PIPs are bad. But they are an important tool and better than the alternative: an employee getting fired out of the blue when that employee perceives themself as a rock star.” Consider the following six steps toward achieving success with a PIP – aka a performance improvement plan.
Identify specific incidents where the employee’s performance has fallen short. General terms such as “poor attendance” or “poor sales performance” are not helpful. Rather, highlight specific examples, such as “no-call/no-show on 11/24, 11/30, 12/2 and 12/3,” or “You failed to meet your sales targets in September, October, and November by ‘X’ amount per month.”
Give specific instructions for the employee to improve performance. This provides the roadmap on how to improve. Examples include “You must call your supervisor at least two hours before the start of your shift if you must be absent,” or “You must convert at least ‘X’ percent of your sales leads to closed sales.” Even when desired performance might be less quantifiable, you can still provide specific requirements such as “Avoid any further use of profanity when addressing your subordinates.” The goals set for the employee must be reasonable and attainable, and they must track the examples of shortcomings provided in the PIP. Do not add other areas for improvement.
Provide a reasonable amount of time to improve. A two-day PIP is nothing but a paper tiger and will be seen as pretextual. Instead, give the employee 30 or 60 days to show improvement. Less than 30 days’ time is not enough. More than 90 days is usually too long. Remember a PIP may be extended if the employee shows some improvement but is not yet fully meeting expectations.
Flag the consequences of failure to complete the PIP. Do not hide the ball: if termination is on the table, let the employee know, and reserve the right to terminate the PIP sooner than the stated duration. The PIP also should state that it does not affect the at-will nature of the employment relationship, which may be terminated at any time by either party without cause or prior notice.
Document the PIP. Make sure to get the employee’s signature to confirm receipt of the PIP. If the employee refuses to sign, write “employee refused to sign” on the document and have two members of management sign it (the PIP is no less binding should the employee refuse to sign). Similarly, if the employee disputes the PIP, accept the statement, and put it in the employee’s personnel file. The PIP will still apply regardless of the employee’s protest.
Follow up. The PIP should not be the last time an employer talks with the employee or the employee’s supervisor because feedback during the PIP period is essential. You should schedule these check-in meetings ahead of time, and you should follow them by providing a written account of the meeting to the employee.
As seen in a recent article in the Wall Street Journal, PIPs have a bad reputation. But done properly, a PIP advises the employee where work performance is not meeting expectations and gives the person time to improve performance — while creating a valuable record for the employer.
For example, think of the hypothetical of a poorly performing employee who is not on a PIP and requests medical leave or files a workers’ compensation claim. Without the PIP, the employer has a Sisyphean task ahead of it trying to prove that the employee has issues that would justify termination. But with the PIP, you will have written evidence that the PIP preceded the claim, complaint, or leave request, so a claim of retaliation would be weak.
Stephen Scott is a partner in the Portland office of Fisher Phillips, a national firm dedicated to representing employers’ interests in all aspects of workplace law. Contact him at 503-205-8094 or [email protected].
The opinions, beliefs and viewpoints expressed in the preceding commentary are those of the author and do not necessarily reflect the opinions, beliefs and viewpoints of the Daily Journal of Commerce or its editors. Neither the author nor the 91Ƶ guarantees the accuracy or completeness of any information published herein.