When roadside patrol mechanic Yep Yap was sacked in 2022, he’d been put on a performance management plan and failed to meet three key performance indicators.
But the Fair Work Commission found the targets set for Yap were unrealistic, unachievable and improper, ultimately forcing his employer, the company Club Assist, to reinstate him with back pay under unfair dismissal laws.
Performance management plans, also known as performance improvement plans (PIPs), have become common as a tool towards dismissing an employee. While meant as a genuine way to improve workers’ performance, they are increasingly being used as a tick-the-box exercise towards getting rid of people and still complying with unfair dismissal laws.
In fact, these laws – introduced more than 40 years ago to protect workers from arbitrary, unfair sackings – are what have made PIPs so popular in Australia, says Joydeep Hor of employment law firm People + Culture Strategies.
“There’s no hard and fast rule that says you have to have someone on a PIP before you can terminate their employment for performance reasons, but in the absence of one, there can be some questions asked,” Hor says.
So, what should you do if you find yourself on a PIP? How do they work? And what do managers need to know?
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