Need-to-know info about letting go of underperformers

The shortcomings of underperforming employees may show up as missed deadlines, lack of initiative, chronic lateness, or poor communication. While these behaviors are not necessarily egregious policy violations, they still carry consequences for employers. Underperformance can drain team productivity, lower morale, and signal to other employees that mediocrity is acceptable. It can also jeopardize business outcomes and drive away high-performing employees. The key for employers is knowing when to act and how to do so without inviting legal trouble.

Progressive discipline: helpful, but not always necessary

Many employers rely on progressive discipline to guide their actions prior to termination. An example of progressive discipline might be verbal warning, followed by written warning, a final warning, and finally termination. Progressive discipline can be helpful, especially when applied consistently. Employees often perceive the structured process as fairer and more transparent, while it helps employers establish a paper trail.

However, progressive discipline is not legally required in most at-will employment situations and is not always the best fit. Progressive discipline is also time-consuming, which can allow workplace problems to fester. Employers may benefit from adopting disciplinary policies that allow for more flexibility.

Protected activities: timing is everything

Another consideration is that the longer an underperformer stays around, the greater the chance that the employee’s performance will overlap with legally protected activity. This overlap can complicate an employer’s decision to terminate.

Protected activities refer to certain actions that employees can take without fear of retaliation from their employer. For example, reporting discrimination or harassment, requesting disability accommodations, taking protected leave (e.g., FMLA, ADA, or workers’ compensation), discussing wages, working conditions, or the company’s compliance with laws or other regulations (such as OSHA compliance), or participating in an internal workplace investigation.

Terminating an employee shortly after the person has engaged in protected activity, even for lawful reasons, can trigger retaliation claims. Timing alone is enough to raise suspicion that the employer acted unlawfully.

Consider this hypothetical: Late Larry has arrived late four times in the past two months. On Monday, his supervisor gives him a verbal warning for his tardiness. On Wednesday, Larry is late again, and his supervisor gives him a written warning. On Friday, he is late once more, and his supervisor is ready to let him go; however, Larry also goes to Human Resources that day to raise concerns about his wages (a protected activity). While the supervisor may have already made up his mind to terminate Larry for his tardiness, the timing of that decision just made the case a little murkier.

When considering termination after a protected activity, employers should act with caution but not feel paralyzed. Each termination is different and requires a fact-specific analysis.

Documentation: employers’ strongest legal defense

As with all employee matters, documentation is essential, but especially so when it comes to employee termination. In the event a termination results in a lawsuit or administrative charge, documentation can help show that the employer had concerns about the employee’s performance long before the employee engaged in protected activity. In Late Larry’s case, documentation of his tardiness and prior warnings would help demonstrate that his termination was based on legitimate, non-retaliatory reasons, unrelated to his wage complaint.

Courts and government agencies often rely heavily on written records when evaluating whether an employer acted lawfully. Documentation also helps defend against discrimination claims by showing that the employer treats employees fairly and consistently. Finally, from a practical standpoint, documentation creates a reliable record of events or details that can be difficult to recall when a lawsuit or administrative charge is filed months or even years later.

Employer takeaways

If left unchecked, underperformers can quietly erode a company’s culture, morale, and results. By taking thoughtful action, documenting consistently, and applying policies uniformly, employers can make termination decisions that are lawful, defensible, and necessary for the health of their business.

Missy Oakley is an attorney with Barran Liebman. She represents employers in a variety of matters. Contact her at 503-276-2122 or [email protected].