Misconduct and Performance Issue in Employment
It’s true that in cases of serious negligence, conduct may amount to serious misconduct. But usually, if someone performs less than satisfactorily, this is a performance issue, not misconduct. The remedy is to follow an appropriate performance management process.
It’s beneficial to analyse performance in the context of warnings, at least, not in the same sense as warnings are used in a disciplinary context where misconduct is the issue. The ERA stated in the present case that ongoing performance issues could be treated as serious misconduct but really, poor performance always remains poor performance, how can it become misconduct?
For instance, in a case of McKenna v New Zealand Automobile Association, an employee was alleged to have made a lot of processing errors. The employer viewed this as misconduct and ultimately terminated the employee’s employment on the basis of serious misconduct.
Leaving aside the matter that the employer’s disciplinary procedure was defective, even if there had been misconduct, the trouble was that the employer had confused performance issues with misconduct. The employee had simply made errors.
In professional view, it’s better to treat performance as always being a performance issue and in that regard, to acknowledge that there will be a point where once the employee had been given every opportunity, their employment may need to be terminated. Prior to that, it would be best that the employee has been made aware that their employment may be terminated if their performance doesn’t improve with in a stated time frame. You can say that this is a warning, which it is in a sense, but whatever you call it, you are fairly informing the employee that to retain their position, their performance needs to improve.
It won’t be fatal if you use disciplinary concepts to deal with the issue but in my view, clearer thinking will be likely if you regard performance issues as being performance issues and not misconduct.
The point of the case is that one need to know when a performance issue is involved and when misconduct is involved. The former is about performance management, whereas the latter is about an employee not repeating misconduct.
Compensation
An employee can claim compensation for distress caused by disadvantage caused to them by the unjustified actions of the employer.
For example, where termination is completely unjustified or, though there’s good reason to terminate, the employer has followed a flawed procedure. An average award for such compensation is probably in the $15000-20000 range at present, with the potential to be significantly higher in serious cases. Then there’s the question of the right to recover lost income where termination is unjustified, including substantively i.e. where there’s no good reason to terminate.
When it’s borne in mind that reinstatement must be ordered if practical, it pays to get things right or as right as possible, given that there are grey areas from time to time.
