We are a small company employing only four sales people. Two of our sales people are badly under performing and having exhausted all avenues over the past six months to help them, they are still failing to meet sales targets. What process do we have to follow to dismiss them?
In these circumstances of poor performance you will need to approach dismissal on the basis of capability. There is a template Capability Procedure on our website. This is probably overkill for a company of your size, and so you could use a simpler procedure along these lines:
You should invite each of your failing sales people to a meeting with you. You should write to them stating that following several informal reviews of their performance, you now wish to formally review their performance and the reasons for their consistent failure to meet their targets. You should give them the right to be accompanied by a work colleague or trade union representative.
At the meeting you should go through the issues and allow them the opportunity to state their case. Following the meeting you should write to them stating the outcome which is likely to be the issue of a warning that they have failed in their performance in relation to meeting their targets, you would be monitoring their future performance (over say 1-3 months depending on your business cycle), and you would wish to meet with them again after this period to review the situation. Make sure they have clear written targets which you can monitor.
After the review period you would again write to them setting up a meeting to review their performance. Again offer them the right to be accompanied. Go through the same process as the last meeting, and at the end (assuming they have not met targets) you should issue them with a final warning that if they again fail to meet their targets within a reasonable review period – 1-3 months, then it is likely that you would need to terminate their contract of employment.
After the review period, write to them setting up a review meeting. In the letter offer them the right to be accompanied, and re-iterate what you wish to discuss, and that should they have failed to meet their performance targets the outcome could be dismissal. So there should be no surprises during the meeting.
At the meeting you should obviously allow them to explain why they have under-performed. However if you are of the view that they have failed in their performance again, you should terminate their contract with the appropriate notice (which you might want to pay in lieu). You should write them a formal letter of dismissal outlining the reasons for terminating their contract. It is also good practice to give them a right to appeal against your decision to dismiss. In a small company such as yours, it is often hard to find someone else to hear an appeal, but if there is another director perhaps they could do it, or someone external to your company could hear it. Otherwise it would just need to be considered by you.
The only other consideration is the length of service of your sales people. If they are coming up to 2 years service then it would make sense to try to complete the above procedure prior to them achieving this service. In this way you can avoid any possibility of them applying to an employment tribunal for unfair dismissal (although if you apply the above procedure then you should have a sound defence should it be necessary).
(Article reviewed January 2018)