The steps you need to follow to get this special kind of dismissal right.

So you have an employee who isn’t up to scratch and they are costing your organisation money. How can you dismiss this person gracefully, and most important, legally?

Dismissal for reasons of underperformance is a special kind of beast, more complex than terminating employment for inappropriate behaviour, fraud or theft.

Essentially, you’re saying that the performance of the employee is poor, that you see no room for improvement, and that it’s time for them to go. But given the somewhat subjective nature of “performance”, this kind of dismissal is open to abuse by employers who want to use it as an excuse to rid themselves of an employee for other reasons.

There’s also a common misconception that a “three strikes and you are out” policy is how performance based dismissals are managed. While this might be a good rule of thumb, it’s by no means a hard and fast rule. Let’s take a look and what you should and shouldn’t do.

The first step

If you have a staff member who isn’t delivering, then you need to start by having a conversation with them about their lacklustre performance. You should offer that they can have a support person present in any meeting that you have, although it’s not compulsory. Make it clear in the meeting that if their conduct doesn’t improve, you may have to dismiss them. Ensure that this notice is in writing. Post meeting, have the employee think about how they’re going to improve, and then both parties should sign an improvement plan to set the employee back on track. Often this type of conversation will improve performance for some time and it can sometimes be a permanent fix.

What if you see no improvement?

If the conduct continues or comes up again then you need to take further action. This is the hardest but also the most important. You need to regularly follow up with the employee to make sure they’re complying with their improvement plan. If their performance still doesn’t improve, then the employee should be presented with a formal written warning. If you fail to follow this process, the employee has grounds to say that they had no idea there was a problem, or that the problem was resolved. You should never assume that they know there’s a problem. Staring daggers and the cold shoulder won’t help you here. The quicker you take action, the faster it will be resolved. You may have to repeat this process on a number of occasions.

Termination of employment

If, after several attempts at improved performance, the employee hasn’t complied with the improvement plan, you can then terminate their employment. You might get lucky and the employee realises they can’t match the requirements of the job and they leave first.

But if they don’t make the hard decision for you, it will be up to you whether you want to keep the employee on and how many chances you give them. Whatever you choose to do, make sure you document the process, including all conversations about the matter. That way you have the evidence of what transpired if the employee attempts to say that their dismissal was unlawful.

Jeremy Streten is a lawyer and the author of the amazon best seller “The Business Legal Lifecycle”.