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Performance improvement plans (PIPs) are often used by organisations as a tool to guide their workers towards improvement. However, many workers who have been placed on a PIP believe it wasn't for that reason.
As previously reported by HR Leader, PIPs were created to offer employees a pathway forward to achieve their goals in the workplace, whilst improving their overall performance.
That process of performance improvement plans often begins in a meeting with a manager or supervisor, where a structured outline for improvements can be sorted out, which will ultimately benefit both the employee and the organisation.
However, according to leadership expert, author, and Ted Talk speaker, Catherine Rymsha, HR teams for far too long have been deploying PIPs as a legal crutch when they are planning on dismissing a worker.
“Performance Improvement Plans (PIPs) are often viewed as a tool for helping employees improve, but in many cases, HR teams may deploy them as a legal crutch to protect the company during the dismissal process.”
“When an employee is placed on a PIP, it can serve as a documented trail that the company made efforts to address performance issues, thus safeguarding against potential legal claims of wrongful termination,” Rymsha said.
This documented trail that Rymsha refers to is legitimate. Often, we see these referenced in unfair dismissal cases between an employee and employer.
“While PIPs can genuinely support employee development when used correctly, they are sometimes leveraged as a pretext to quietly usher out employees without directly addressing the underlying intent of termination,” Rymsha said.
Rymsha argues that when HR teams deploy PIPs as a dismissal strategy, it deludes trust within the organisations, especially between workers and management. The overall effect on the chemistry of a workforce can be affected when HR teams use these tactics.
“This practice of using PIPs as a dismissal strategy can undermine trust in the HR function and the broader organizational culture. Employees often sense when a PIP is less about development and more about setting the stage for their exit, which can lead to disengagement, decreased morale, and even a negative ripple effect on the team dynamic.”
“Moreover, this approach can tarnish the employer's reputation, making it harder to attract and retain top talent. It's crucial for HR teams to ensure that PIPs are applied fairly and transparently, focusing on genuine performance improvement rather than as a tool for managing exits.”
“In my corporate life, having been on a PIP, it was used to terminate, not to develop. I didn’t have a chance to “get better” so they used it as a legal safeguard. While that helped, all other documentation like more performance reviews, painted the picture of a strong, hardworking person until a disagreement with my manager led things astray and the PIP was issued.”
Kace O'Neill
Kace O'Neill is a Graduate Journalist for HR Leader. Kace studied Media Communications and Maori studies at the University of Otago, he has a passion for sports and storytelling.
