Performance Management Systems
Performance appraisal systems are the basis both for managing employees’ development and for defending terminations for poor performance in court. We design your performance appraisal and management systems, review your existing systems in light of current Court of Cassation case law and carry out a risk assessment.
What is a performance appraisal system?
A performance appraisal system is the process by which employees’ results and competencies over a given period are assessed against predetermined criteria. Setting objectives, feedback during the period, the end-of-period review and reflecting the results in pay, promotion or development plans are all parts of this process.
What does the Court of Cassation look for in a termination for poor performance?
The Labour Law accepts reasons arising from the employee’s competence or conduct as valid grounds for termination; poor performance falls within this scope. However, in performance-based terminations, the Court of Cassation requires the system to be based on objective, measurable criteria notified to the employee in advance.
In addition, the targets must be achievable, it must be possible to compare the employee with others in similar positions, the poor performance must be persistent rather than temporary, the employee must be given an opportunity to improve and, if necessary, training, and their defence must be taken before termination. If these conditions are missing, the termination may be held invalid.
Scope
- Designing performance appraisal and management systems, reviewing existing systems in light of current Court of Cassation case law and carrying out a risk assessment
- Structuring performance improvement plans (PIPs) and the documentation process
- Legal assessment of performance-based terminations
How We Work
- Reviewing the current performance system, forms and how it is applied in practice
- Assessing the system against the criteria the Court of Cassation requires and reporting the risks
- Redesigning the criteria, the appraisal calendar and the objection mechanism
- Documenting the performance improvement plan and defence processes
- A short training for managers on conducting appraisal meetings
Team
Frequently Asked Questions
Is a single low performance rating enough for termination?
Usually not. The Court of Cassation requires the poor performance to be persistent and the employee to have been given an opportunity to improve. Low results over more than one period, and the employee having been warned and supported during that time, are important for the termination to be valid.
Must performance criteria be notified to the employee?
Yes. Notifying the criteria and targets to the employee in writing at the start of the period is the main indicator that the system is objective. An appraisal based on criteria the employee did not know about will be interpreted against the employer in a termination case.
Is it mandatory to take the employee's defence in a performance-based termination?
Yes. Under the Labour Law, a contract cannot be terminated for reasons related to the employee's conduct or performance without first taking the employee's defence. The request for a defence should be in writing and the employee should be given a reasonable time.
Is the manager's personal opinion enough for a performance appraisal?
Assessments based solely on the manager's opinion and not supported by measurable data are weak in court. Wherever possible, they should rest on numerical targets and documented observations, and more than one assessor should be involved in the process.
Would you like to discuss this service? Schedule a meeting with us — the first meeting is free of charge.
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