Saturday, January 23, 2010

The Importance of Performance Management

Establishing effective performance management systems can have significant benefits for a business, leading to happier, more motivated and better performing employees. Reviewing, refining and implementing performance management systems are ways of helping achieve these benefits.

A recent ruling by the FWA (Quattrocchi v Monsanto) highlights the importance of effective performance management processes. In this case, the employee was dismissed because of repeated work errors and the employee claimed unfair dismissal. Even though it was ruled that the reasons for termination were valid, that 3 separate warnings were issued and a 60 day performance management improvement plan was put in place, the commissioner ruled that, amongst other things, the performance improvement plan did not state clear goals and measurements nor did it provide support for the employee to improve.

In other words HR and management were going through the motions and just wanted him out. In the end the unfair dismissal claim was dismissed because the FWA ruled that the employee was disinterested in addressing the performance issues. If it hadn’t been for this, the FWA would have ordered a reinstatement or compensation.

So having an effective performance management plan in place is critical to not only maintaining a motivated work environment but also to managing poor performers.

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