A companys HR director, Mary, invited me to sit in on a meeting with a senior executive, Morton, who wanted to fire a longtime employee in his department, Jerry, and sought Marys backing.
For years, Jerry had underperformed, alienating co-workers and disappointing customers. Morton explained that he had given Jerry extra coaching, had tried performance improvement plans and had even switched Jerry to alternate supervisors. However, no sustained positive change had occurred.
He explained that there was a new urgencytechnological and market changes had created industry upheaval, and the companys CEO had declared he could no longer tolerate deadwood.
“It doesnt get much deader than Jerry,” Morton said.
Mary spoke for the first time: “What documentation do you have?”
Not surprisingly, the documents werent very helpfuland Mary let Morton know that.
“But what about all the performance improvement plans weve put him on?” Morton asked defensively.
“Theyre not current,” Mary replied. “Besides, technically speaking, they were complied with.”
“Yeah, but in his last performance review, his supervisor checked needs improvement in several places,” Morton said.
“That doesnt constitute clear disciplinary notice that an employee faces termination,” Mary responded.
Things were getting tense. Mary turned to me. “Jathan, do you have anything to say?”
I wanted to make sure I understood the business case, so I attempted to summarize the problem from Mortons perspectivethe long, frustrating years of employing Jerry; the failed attempts at improvement; the heightened sense of urgency.
After Morton confirmed that Id accurately assessed the situation, I said, “Now, lets examine your desired action through a risk-analysis checklist. There are four questions to address:
I told Morton he had made a strong case that it would be substantively fair to let Jerry go. “Its not a personality conflict or a managers vendetta,” I said. “Youve given him repeated opportunities to improve, but he remains unwilling or unable to close the gap.”
Next, I turned to procedural fairness. “Has adequate notice been given so that firing Jerry wont be a surprise?” I asked. “Unfortunately, Morton, I see real problems with this part of the checklist.”
I was also dubious that firing Jerry would be consistent with the disciplinary procedure listed in the companys handbook. “Consistency isnt just about protecting the company against workplace claims,” I said. “Its about supporting a culture where employees feel they will be treated fairly. When management bypasses its own policies, it often creates the sense that leadership cant be trusted.”
Finally, there was the legal risk. “In this case, Jerry is well over 40, and he could be replaced by someone younger,” I pointed out.
The room was silent. I explained that clients often find it helpful to analyze legal risk in relation to business costs and benefits. I use the equation V = LM, where the value (V) of a contemplated action is determined by assessing the likelihood (L) of it occurring multiplied by its magnitude (M). For example, think of comparing a 50 percent risk of losing $10 vs. a 30 percent risk of losing $100.
“This approach leads to creating multiple options and weighing them against each other,” I said. The highest-risk option was to fire Jerry immediately. That would cut off the business cost of continuing to employ him. However, it would maximize legal riskthe likelihood that Jerry would sue and collect a high magnitude of money.
The low-risk option was to continue tolerating Jerry. That would essentially eliminate the legal risk (L?M = 0) but would come at a high business cost, including the risk of talent loss or the CEO becoming very unhappy.
I offered a middle-of-the-road approach: “A risk option in between might involve bringing Jerry to the edge of discharge while leaving some wiggle room. For example, you could lay out in detail why its in his best interest to leave the company. And perhaps incent him with a severance/release offer. That approach has some legal risk but creates a decent chance of getting Jerry out sooner rather than later.”
At that point, Morton and Mary agreed to meet the next morning to develop a game plan.
A few months later, Mary called me. “We agreed on a middle-of-the-road option and created one of the most comprehensive performance improvement plans Ive ever seen,” she said. “We met with Jerry and walked him through his employment history, pointing out the many failed attempts to make things work. We told him the company could no longer tolerate the status quo. It therefore seemed to us that the best thing would be for Jerry to find other employment. If he agreed, wed be willing to provide some severance benefits to help with his transition. Otherwise, wed put him on a lasdisst-chance corrective action plan.”
It was an either-or propositionJerry could either elect severance or attempt to improve. If he chose the latter and was terminated, there would be no severance.
“Jerry went home, came back in the morning, took the severance, signed a release, and quietly and cooperatively left the company,” Mary told me.
“Thats great,” I said.
“I agree,” Mary said. “But you want to know the best part?”
“How Ive interacted with Morton and the managers in his department since our meeting. They now let me know much sooner about employee relations issues. Early knowledge gives HR a lot more flexibility, and its no longer a tug of war between HR and management.”
Ive met many managers who dont have a high opinion of HR and vice versa. The complaints are familiar. From management, its “They dont understand our business! They slow everything down! Theyre the Department of No!”
From HR, its “They dont know how to communicate! They wait until the last minute and then want immediate action! Their documentation stinks, and they blame us!”
However, Ive also met many managers who say HR helps them be more effective as well as HR professionals who value working with managers.
What distinguishes the enthusiasts from the cynics? This story provides a good illustration. Notice the elements. Morton had a festering employee problem, but he never brought it to Marys attention. He waited until he was in crisis mode to loop in HR.
For her part, Mary responded from a strictly HR perspective. Her focus was on the documentation Morton had gathered and the problems it raised. Things went downhill quickly. The meeting easily could have ended with each person renewing their respective membership in the “I hate HR!” and “I hate management!” clubs.
What did I do differently? I resisted the temptation to jump to conclusions. Instead, I put the issue of Jerrys termination in a risk-analysis context. Rather than saying, “Heres the answer,” I presented options so Mary and Morton could find a solution that worked for both of them.
Most HR professionals prefer being coaches but feel stuck in the role of cops. It doesnt have to be that way. If youre in HR, try adopting a risk-analysis approach; Mary has made it a regular practice. If youre a manager, share this story with HR and invite a conversation about it. I think youll be pleased with the outcome.
Discussion about employees performance can be hard, especially the employee performance have gotten worse than the companys expectation. Nevertheless, employees who have been labeled marginal or have a record of poor performance in the company, may be experiencing some issues in workplace that negatively impact performance. Managers and human resource staff have a responsibility to identify discontentment and help employees to make better of the employees performance in the company. This can be accomplish by identifying the causes of the employee poor performance.
In the case study, we found a few common mistakes occurred in the company. First and foremost, the CEO want to fire Jerry because of his poor performance for a long time. He has been provided the extra coaching and even had switched to alternate supervisors but no positive changes has occurred in the company. Some customers even reported about his poor performance.
Moreover, Mary back up Jerry too much. Mary who work as a human resource director back up Jerry too much even though everybody in the company knows that Jerry had been underperformed for quite long time. Mary thought that firing Jerry will wasted all the effort that the company put on him and Mary also afraid that the company will face lawsuit right after firing Jerry.
Furthermore, Mary and Morton try to find the solution regarding to Jerrys underperformance but they cannot settle this problem if one side back up Jerry and on the other side just want to straight fire Jerry. From this situation, it shows that upper management does not think further and lack of information about Jerry status in the company.
Firstly, Mary and Morton will try to find another employee to substitute Jerry if Jerry agree with both of them on resigning the job. Jerry got two choices either to resign the job or improve his knowledge and skills. If he agree to resign the job, Jerry will get some severance benefits from the company. But if he agree on doing both of the choices, he will get no severance benefit.
Secondly, Jathan tells to about the risk of terminate Jerry and the risk of maintain Jerry in the company, so that the CEO and the rest of the upper management will have to think more on the risk and better way on dealing with Jerry, such as put him into a corrective action plan. Other way is giving him severance benefits in order to avoid the company from lawsuit.
Thirdly, management staff should not have any bias when it comes to staff attitude as it going to affect the organization status. Thats why Jathan told Morton about supporting a culture where employees feel they will be treated fairly because if management bypasses its own policies, it will creates the sense that leadership cannot be trusted. Therefore, management should think more about any consequences when they take any action to avoid their loss in future.
In a nutshell, there are few step need to take before terminate any employees and also the company must be considered some factors before they take any action to the employee. As in this case study, they considered about cost of keeping and terminating Jerry and the company also refer to past record of Jerry where he does not improving even though he was provided by the company extra coaching.