This is a challenge that many employers face if an employee is not performing well. They may not be fazed if a brand new hire is not meeting standards, but it may come as a shock if a long-service employee suddenly is no longer performing at their usual level. There are actually several issues to unpack here, and key takeaways to remember.
For the newer employees, the reality is that they may simply not be the right hire, or they may have lost interest in the role while they are looking to pursue something else. The benefit to a shorter service employee is that you are free to terminate their employment really at any time for practically any reason (provided it is not discriminatory), so long as you pay them reasonable notice. If a new employee is underwhelming, you may be inclined to let them go quickly vs. investing the time in performance management.
While this is an option, it can be a risky one. Remember again that duty of good faith, which applies throughout the employment relationship no matter how long the employee has been part of your team. Even if an employee is brand new, it is still bad faith to provide them no support and effectively set them up to fail. Instead, especially if that employee showed initial promise, consider an earnest performance management plan that can effectively ‘right the ship’ before you need to end that relationship.
Dismissing a short-term employee for cause due to poor performance has its own risks, as some Judges will assign some blame to you for failing to do your due diligence in the hiring process. It is also important to note that courts will be more skeptical of performance concerns when they relate to a long-term employee with a good record. After all, it is hard to explain how a good employee suddenly becomes so bad that discipline or dismissal is warranted.
If a long-service employee has been otherwise excellent until recently then their performance issues might come as a shock. While these employees are also owed a duty of good faith, employers should consider that there may be something more lurking underneath the surface. There may be an illness or mental health issue that is impacting performance (more on that later), so be cautious about rushing to judgement or taking decisive action right away.
Along with that duty of good faith, it is also true that without a solid employment contract, longer-serving employees are likely entitled to a longer reasonable notice period. While this may not matter in a performance management scenario where you can effectively terminate the employee with cause, it may become costly should you be required to pay that employee reasonable notice. It is always better to check in with an employment lawyer before moving towards discipline for a long-service employee so that they can help address what may be any underlying issues.
