The End of the Road in Performance Management Why, When and How to let go of Poor Performers in

This talk addresses the challenges engineering leaders face when dealing with underperforming employees and the complexities of employment law, particularly in the UK. Andrew Elum, an interim CTO, outlines a strategy for approaching poor performance, emphasizing the importance of clear communication and documentation. He discusses the concept of offering a settlement agreement as a means to allow employees a dignified exit while minimizing the emotional stress for both parties. The speaker advises on following legal procedures, using a progression framework to assess performance, and ensuring that proper records of feedback and performance management are kept. With updates to UK employment law on the horizon, the talk highlights the need for managers to be well-informed about their responsibilities and the potential legal ramifications of mishandling such situations.

All right, so we talked about high performing teams. Now we're going to talk about dealing honestly with the ones who are not high performing. So joining us on stage, Andrew Elum, interim CTO. He's tackling something that most of us deal with, which is well, we we we try to deal with but sometimes actively avoid is letting people go for poor performance. Andrew, take it away. >> Thank

you very much. Thank you. Cool. So, surprise for you. This talk is not about AI until we get to the questions. Anyway, so this talk is for engineering leaders who must deal with poor performance but find the process uncomfortable or unclear or risky. So, in terms of the T-shaped skill set that we heard about in the previous talk, we're going over from tech over to one side

of the bar of the tea here and talking about a specific situation that comes up when you're a CTO. So, this is the pitch that you can make to an employee who's not likely to ever succeed in their role. You can say to them, I know you and your manager have been talking a lot about performance lately. I'm not here to get into the details of that

today. We can book another time for that if you want. I'm here to offer you another option. Nobody can force you to take this option, but it's there for you if you want it. I'm not going to ask you to decide today. You should take some time to think about it. I would also suggest they talk to their family about it. The deal would be that you

make an agreement with the company that things just aren't working out and it would be better to part ways. You'd get a pile of cash, a lot of it tax-free, and you'd get to preapprove the reference that the company would give about you in the future. You wouldn't be able to say anything bad about the company in future, and nobody from the company would be able to

say anything bad about you. This can work out pretty well. I've said to them, I've been in that situation or my friend has been in that situation, my spouse, my colleague has been in that situation and it worked out well for me or for them. So, what I'm trying to do there with that part of the pitch is say to them, this isn't something to be ashamed

of. It's okay to do this. Uh, it allows you to skip some stress and you get paid to take a holiday while looking for your next job. It doesn't show up as a gap on your CV. I would probably reassure them that they've not been they won't have to tell people that they were fired because they haven't been fired. If you decide to go for this option,

then the company will pay for you to get independent legal advice and you can choose the lawyer. The rest of this presentation today is about how you get to the point where you can make that pitch. So, we've got a bunch of things to cover. Um we will talk about getting ready making the decision. We'll talk about the law which is going to change soon. Uh actually

making the pitch itself some of the practical realities around doing it your own well-being and then a bit more detail about the changes coming soon. So one reason for this talk most tech industry advice uh about performance management is from the USA and US employment law is very different. States like California have at will employment. Um, if you're reading about performance management, sometimes that advice will assume

that you can just let people go. And in the UK, you can't, not so easily. It's governed by statute, the Employment Rights Act, the Equality Act, by case law, by the AAS code, by company policy. Uh, many engineering managers know all this in theory, but have never done it. Uh, the instinct can be to avoid doing it. In this talk, uh, I'll be talking practical UK focused

what to do when improvement looks unlikely. So, I'm not suggesting that this should be the first thing in your toolbox that you reach for. Um, but sometimes I don't know if you've gone into a pre-existing team and maybe it's obvious that there are a couple of poor performers there who are dragging down the rest of the team or you've been in the situation where you've tried the

performance management route with a member of staff. You've tried to improve their performance. Lots of people have tried and it just hasn't worked. So why to uh why not to avoid? The team pays the cost of avoidance. Extra work goes to the rest of the team. They usually don't like it. Standards drift down. Good people lose motivation. Why should I bother putting in the extra effort if

this other person isn't the manager's credibility erodess um and as a manager you act on behalf of the business and its owners. Uh tolerating poor performance is a failure of that responsibility. So identifying poor performers. Um the competencies framework. This fits in very neatly with what you were hearing in the pre previous talk. Um, so it's obviously no good to say to somebody be a better software

engineer. You need to have a framework sometimes called a progression framework of what good looks like. What do you expect? What skills do you expect from each individual contributor at what level? You don't have to make this up for yourself. There are lots of ones you can choose from that exist already. Progression.fyi has loads of them. I recommend the Monzo V2 framework um because I've used it

and I've seen it work very well. Um you need to assess how well they're doing against the competencies and the levels in that framework. Um get peer feedback, get stakeholder feedback. Obviously bear in mind people may sometimes have an axe to grind, but if everyone from different directions is saying the same thing, there's probably some truth to it. um documentation. You should collect it. Written written records

of concerns, conversations, feedback. Uh this should not start when you've decided to manage the person out. It should be normal practice for everybody um in the team. If it's not written down, it didn't happen is pretty much the tribunal standard. Um and that must be organizationwide. So a tribunal will look critically on these measures if they are only applied to a single poor performer. So all of

this stuff needs to be there for the whole team. This should not be a surprise. Uh it's a prerequisite that the the individual who's underperforming should know about it already before we're getting into the start of making this pitch to them. Um so early intervention is important. Honest timely conversations about concerns as they come up give them a real chance to hear and respond and support them

in improving. There is a lot to talk about there. Too much to fit in the time today. I don't want you to think I think it's unimportant. I think it's very important, but I've only got 20 minutes today. So, this talk uh assumes this feedback has already been given. They've tried to improve. You've supported them in trying to improve. The problem is has not gone away. Um

written one-to-one notes are super important. They protect the employee. If they prove that they were told, given examples, told what's going wrong, given examples of what's going wrong, offered the chance to improve. If there are no notes, then the manager could be rewriting history and saying, "Well, I told you six months ago." When actually they didn't. They protect the manager. If it comes to a tribunal, they

will want evidence that you raised concerns, gave them time to respond, followed fair process. Um, if you're going from your memory six months later, that will be given very little weight. uh contempor contemporaneous notes are far more credible and they create a timeline of when the concern was first raised and the process of feedback, employee response, what support was offered, whether anything changed and that's what HR

teams, leadership and tribunals look for. This does not need to be formal. It can be a few sentences written down after each onetoone. Um share with the employee or send a follow-up email and you've got a shared record. It takes less than five minutes. If you don't do it, if your managers don't do it, it can cost months of your time and tens of thousands of pounds

of the company's money, which is why people t teams are always going on about it. Um, you need to know the process before you start. So before you begin to think about a settlement agreement, um, you need to understand the ground that you're standing on. You need to get advice from your in-house people team if you have one, from an external employment consultant if you don't. Um,

you would pay about1 to 150 pounds an hour for a external consultant and that's a lot cheaper than losing a case at the tribunal. Um, you must understand your company's own policy and you must follow it. You must understand AAS recommendations and your legal obligations. Um, if you skip this and make early mistakes, it messes up your options later on. This is not optional. is the first

thing you do because you have to follow your company's own policies. The right thing to do differs from one company to another. So that big policy document when that everybody says they've read when they joined and nobody ever reads, you need to actually read that. You can't just do things the way you did at your previous employer because if you don't follow the policies of this employer,

then you're breaking the rules because the law says you have to follow the employer's policies. What you're trying to avoid are tribunal claims. Uh the most common grounds are unfair dismissal which can be claimed at the moment with two or more years of service but that is decreasing very soon. Um the employer must show a fair reason um often capability and also a fair procedure. Both things

have to be fair. The process has to be fair as well as the reason being good. Uh possible claims, discrimination under the Equality Act 2010. Protected characteristics are age, disability, gender reassignment, marriage or civil partnership, pregnancy or maternity, race, religion or belief, sex, and sexual orientation. There's no qualifying period for this. If discrimination occurs on day one, then the employee can make a claim. Uh harassment, unwanted

contact conduct related to protected characteristics. victimization, treating someone badly because they raised or supported a discrimination complaint and constructive dismissal, employer conduct so unreasonable the employer feel the employee feels forced to resign. Um it is possible to to accidentally introduce these things during the performance management process. So even if the employee genuinely was underperforming, if you mishandle the performance management process, you might accidentally do some of

these things. So that's why you got to check carefully. Uh your people team or your HR team is your best friend in this. Um they exist partly to protect the business, partly to protect employees. They are your ally. If they're in-house, involve them from the start. If you don't have an in-house team, um you need to get an external consultant. The cost of advice is a fraction

of the cost of getting it wrong. Um a good people professional will tell you if the evidence is thin, the process has gaps, or if you're moving too fast, and you should listen Getting your stakeholders aligned. Um so you don't want to dive into this by yourself. You want to make sure the people team is on side with the idea that this particular employee is performing so

badly or so much failing to improve that you would like to offer them a settlement agreement and you would be well advised to get your executive leadership on site in advance as well. Um there's a fair chance that the employee will go to other members of leadership to say, "Hey, I'm being treated unfairly." If they don't know about it in advance, they might say the wrong thing.

yeah, so the choice really uh is do you keep on trying to help them improve? Uh maybe that involves a PIP uh maybe simply smart objectives in their oneto ons or do you try to help them get to an exit in a way that allows them to kind of keep their dignity and self-respect and also brings things to a close without too much risk or time taken.

Uh before you make this decision, you should check do they have a disability. Uh it might not be visible. Uh it could be a mental health disability. If they do, you need to make reasonable adjustments. Um so uh if they do, then I would suggest get them an occupational health assessment. Find out what reasonable adjustments you need to make and go ahead and make them. And then

a few months later see if performance has improved. And if it has, great problem solved. And if it hasn't then back into this process then. Um so uh your goals as a manager what you're trying to achieve there's two goals really. One is to for them to improve their performance. If they can if you can get them to do it if you can help them to do

it then great. The other is if exit is possible, you'd like for them to leave with not too much ill feeling, with their dignity intact, uh without damaging the team, without a lawsuit. Um you want it to be a fairly straightforward process. Uh the legal framework, UK employment law, employees with qualifying service have the right not to be unfairly dismissed. The burden is on the employer to

show a fair reason such as capability and also a fair process. The ACAS code is a code of good practice. It's not law, but tribunals must consider it. If you unreasonably fail to follow it, the tribunal can increase compensation up to 25%. And your company policies, what your company handbooks handbook says, you're expected to follow. And if you don't, it creates legal risk. The process matters as

much as the substance. if they really are a good performer and you mess up the process, you've still got a really expensive tribunal case on your hands potentially. So, what is a settlement agreement? That was what I was pitching at the start. Uh, used to be called a compromise agreement. It is a l legally binding contract in which the employee waves the right to bring certain claims

typically including unfair dismissal in exchange for payment and agreed terms. It's useful because it brings certain closure to the matter. There will be no tribunal after that. No appeal, no lingering risk. It's good because it's fast. Two to six weeks. Formal capability process might take three to six months. If that then goes to a tribunal, that would take years. Um, and there's less damage to both sides.

Uh, avoiding stress, avoiding cost, avoiding risk. The team is disrupted for less time. the employee moves on sooner and maybe finds it easier to get another job in the confidence of knowing that their reference is going to be neutral probably. Uh for the agreement to be legally valid, the employee must receive independent legal advice before signing. The employ the employer typically pays for that. Um obviously you

can't make them receive independent legal advice, but you shouldn't sign the agreement if they haven't because it won't be valid. So, how to talk about this stuff without getting yourself in legal trouble? A without prejudice conversation means the contents of the conversation cannot be used in a tribunal in the future. Um, so talk to your people team about how to explain that to the employee. If there's

already a dispute, then you can have a without prejudice conversation. You can also have a protected conversation um even if there's not already a dispute. Um, but it doesn't apply to discrimination claims and these sorts of protections can be lost if you engage in improper behavior. So, you can't use this as an excuse to act badly. Uh, in practice, talk to your people team. Uh, have them

be present in these conversations. See if you can frame them as no blame. This isn't working out for either party. We'd like to offer a fair, dignified way to move on. And they need time to think about it. AAS recommends 10 10 calendar days. Um before the pitch, think about whether you're the right person to make this pitch to uh the team member. If you feel angry

with them for their underperformance and you're not able to hide that anger effectively, you are probably the wrong person. So if I'm assuming here that you're the CTO, you're probably their skip level. That's why you might be the right person because their line manager will have been going backwards and forwards with them about this underperformance for quite a long time probably uh maybe it's good for someone

who's not been immediately involved in the situation to be the person that has that conversation with them. But if you have been immediately involved in it and if you are feeling angry with them, it would be better for you to get somebody else to do it like people team or one of the other execs maybe. Uh pitching the settlement from the employees perspective this may feel like

a disaster. They may feel like you're firing them which you're not. Your job is to show that this is reasonable. Um they get a big pile of money which is quite a good consolation prize for anybody. The first 30,000 pounds of this usually uh will be taxfree. The actual termination payment itself that doesn't apply to contractual notice pay or holiday pay. Um they will get an okay

reference. I mean most references these days are just this person worked for the company from this date to that date. That's the kind of reference they'll probably get. They'll be able to agree it with you before the signing of the settlement agreement. This removes a major anxiety for them. Um, and they will get time and dignity. They'll get to leave on their own terms. There'll be no

dismissal on record and they can tell their next employer whatever they want to tell them essentially. Um, so the tone of this conversation uh is enormously important if you can frame it as this is something that happens sometimes. It's not really anyone's fault. Can we bring it to a close? I've been in the situation that you're in before or a friend of mine has or a colleague

of mine has and actually it worked out okay trying to say to them it's all right to to leave with dignity. Um you're trying to open a door for them here. You're not trying to punish them. So the agreement should be fairly generous. If you are stingy they are less likely to say yes to it and therefore you've got all that long-term risk. If you are fairly

generous, then maybe they go home and they talk to their family and they say, "I've been having a miserable time at work lately, but I could walk away with tens of thousands of pounds, have a few months off, find the next job." There's a fair chance their family members will say to them, "Maybe you should seriously think about doing that." Um, do not tell them that they

will be dismissed if they don't agree to the settlement agreement. You must not put undue pressure on them to accept the agreement. uh otherwise it might not be valid and you might end up you might end up in a tribunal anyway. Um how much money to pay them as a multiple of salary not including notice period. Uh one to three months if it's low risk uh so

short service clean evidence of underperformance. Two to three months if they've got qualifying service of over two years and there is maybe a unfair dismissal risk. um three to six months if there's more risk discrimination or whistleblowing. You might lose in a tribunal. Uh if they've been with the company longer, uh the more senior they are, the more serious the discrimination risk is, the higher the multiple

typically is. Um these are not official figures because the settlements are all confidential, but these are the sorts of things that practitioners say on their websites. Practitioners meaning lawyers. Um, how long does it take? The settlement agreement, two to six weeks. Formal pro performance management, 3 to six months typically. Um, and then if you get to the end of the performance management process and you fire them,

you're still going to have to pay them their notice period. And then you still have the risk of a tribunal, which as I said could take a couple of years. Um, so the speed in containing the risk is one of the strongest arguments for the settlement approach. Um, I've had the problem before where other members of the exec team were so pissed off with this person that

they didn't want to grant them a settlement agreement because they were angry with them and they wanted to force them to go through the the performance management process. What I suggest doing there is quantifying it. So saying if you know there's a risk of um us losing a tribunal it might be 60k if you think there's a 50% risk of us happening that's 30k um is your

anger really worth 30k was an argument that worked worked well on the CFO after the person has gone um obviously tell the team that they work with because otherwise they'll just speculate um so brief and respectful this person has left the company we wish them well with their next role. Um, team morale often improves because they've now got not got to carry the poor performer anymore, but

only if the process looks professional and then also learn from it. Um, was it the wrong hire? Is the role wrong? Was the feedback early enough? Is the support structure there? Um, so a kind of blamefree retrospective look after yourself during this process. Um it's not easy. Uh and that is is right. Um look for support yourself. If the company offers coaching or an employee assistance plan,

then use it. Carrying the weight of it alone makes it worse. Upcoming changes. Um so the Employment Rights Act passed at the end of last year. Um there's a load of changes. some of the most important ones. The qualifying period for unfair dismissal is going down to six months from the 1st of January 2027. Um it'll bring about six million more employees in scope. It makes early

performance monitoring and structured probation periods even more important. Uh the compensation caps being removed. Uh the compensation will be the actual financial loss with no limit. Extended tribunal time limits are coming in. It'll be six months instead of three months to bring a claim. Strongest sexual harassment duty from October this year. All reasonable steps, not just reasonable steps, must be taken to prevent it. Um, and fire

and rehire restrictions are coming in next year as well. So, all of this is being tightened up, which means it matters even more than it used to. Um, top tips. If you take one photograph, make it this one. Um, don't improvise. This is not a move fast and break things situation. Um, if you are in a situation where you don't want to know what to do, I

think it's a perfectly reasonable response to say I take this really seriously. I'm taking notes on it now and because it's so serious, I need to get advice from people team on this and I promise I'll come back to you by the end of the day tomorrow. I think that's a perfectly reasonable thing to say. Much much better than improvising. Um, get expert advice from an HR

consultant. Make a plan. Follow the plan. Document things. Write down what happens in oneto ons. Even if it's unproatic and it's the best um, performer on your team, just write them down and get your managers to write them down. Um, you need professional advice because your circumstances may be different. This stuff is really complicated. Northern Ireland has entirely different rules. Other countries obviously have different rules as

well and you might be uh liable under those rules and our rules. So for example, if you have an employee in Spain, you're subject to Spanish employment law and UK employment law maybe. But get advice. Um and remain calm and objective. Don't get drawn into emotive arguments uh or distracted from your objectives. Uh you must remain professional, pleasant, and in charge. That is it. Uh the thing

is flashing zero at me. So I'm guessing that means we don't have time for questions. >> Uh but if you want to catch me afterwards, you're very welcome to. >> Did you have your