SME recruitment: How to manage underperforming staff

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As a business owner or manager, your people are your greatest asset. However, a staff member who does not perform their duties properly, or engages in any kind of misconduct, needs to be managed appropriately.

Underperforming staff can be very destructive. By underperforming, they pose a risk to your business, customers, and other staff. However, dismissing staff is much harder in South Africa than in other countries, given the strict labour regulations. As such, employers need to be aware of the methods that are permitted.

Underperforming staff can be managed in two ways: 1) improve the employee’s performance and 2) remove them from the business. The best approach is to try 1 first and, if that fails, do 2.

1. Improving the performance of underperforming staff

There are some tried and tested ways to improve staff performance which we at Giraffe have seen across business of all sizes and industries:

Ensure you have a written employment contract in place. It is illegal to employ someone without a contract and dismissing such an employee could land you in serious trouble. Download a free employment contract here
Onboard new staff properly. Studies show that staff that are properly onboarded and integrated with rest of your team at the very start feel a greater sense of belonging, loyalty and therefore responsibility than those who are not
Articulate your business’ mission clearly. Your staff need to know (and be convinced) about WHY your mission is important and what role they are playing in reaching it. Staff that buy in to your mission are more likely to perform better than those who do not, or are not aware of your mission
Set objectives, expectations and career progression milestones. Employees who know what their objectives are and what is expected of them are more likely to perform well. Often staff underperform because they don’t know what is expected of them. Employees are also motivated by their career prospects. For example, if they know that they will get a pay rise if they meet specific objectives within a certain period, they are more likely to perform better than if they have no visibility of when their next pay rise will be
Give feedback in real time. If one of your employees is underperforming, tell them as soon as you can, giving them evidence. Often this is sufficient to improve performance.
Have regular feedback sessions. It is critical to have regular feedback sessions (at least every 3 months) highlighting your employees’ achievements and development areas. Be honest, direct and encouraging with your employees and you will see them improve their performance.

2. Removing staff from your business

Sometimes, even when all the performance improvement measures mentioned above have been done, staff continue to underperform. In this case, the best option is to remove them from the business. Don’t feel bad, it is normal to remove staff from the business from time to time. And it is the best thing both for them and for your business.

The best way to remove staff is by mutual agreement. If you have successive feedback sessions indicating underperformance, and which result in lack of salary increase or bonus, underperforming staff will often resign voluntarily- as they will know that their prospects for future growth and earnings in your company are limited.

If this approach does not work, and underperforming staff continue to stay even if they know their prospects are dim, it may be necessary to dismiss them. However, South African labour laws are very strict and it is critical to conduct staff dismissals in the correct way, so as not to fall foul of the CCMA. Below is the process you need to follow to dismiss a staff member:

• Ensure you have a written employment contract in place. It is illegal to employ someone without a contract and dismissing such an employee could land you in serious trouble. Download a free employment contract here
• Get proof of the suspected misconduct or underperformance and ensure it is documented in writing
• Inform the employee of your concerns, in writing, giving the employee an opportunity to improve their performance within a reasonable timeframe
• If performance does not improve, hold a disciplinary meeting, giving 48 hours advance notice. If the employee is absent on the day of the disciplinary meeting, without a valid reason, you can still conduct the meeting in the employee’s absence. The meeting should be minuted and recorded
• The employee should have an opportunity to respond to the alleged misconduct or underperformance. The meeting chairperson should be a neutral party and should consider both sides of the argument before reaching an opinion
• The employee should be given the right of representation by any relevant union at the disciplinary meeting
• Give the employee the final decision in writing

Employers should refer to the CCMA website for more information on fair dismissal procedures.

Most, if not all, businesses will have to deal with underperforming staff at some point. It is important for managers and owners to know how best to deal with them.

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