Settlement agreement, transition allowance, dismissal
An employer must provide specific evidence of underperformance and give the employee a genuine opportunity to improve.
Underperformance means that an employee does not meet the reasonable requirements of the role. A single mistake, a vague impression or unexpected criticism will not normally be sufficient for dismissal.
The job requirements must be clear. Relevant evidence may include an up-to-date job description, specific agreements, assessment criteria and records of performance reviews.
1. Specific shortcomings: the records must show in which respects performance is structurally inadequate.
2. Timely warning: the employee must be told what is inadequate and that improvement is required.
3. Genuine opportunity to improve: the employer must provide sufficient time, guidance and appropriate support.
An improvement plan should contain measurable objectives, a reasonable duration, review dates and clearly defined support. What is reasonable depends on the role, experience, nature of the criticism and the time needed to demonstrate improvement.
Cooperate constructively, record your own response in writing and raise concerns promptly if objectives are unclear or unrealistic, or if promised support is not provided.
Dismissal for underperformance may not be based on unsuitability resulting from illness or disability. The employer must also consider whether training or changes to working conditions could enable improvement.
If performance does not improve, the employer must generally investigate whether redeployment to another suitable role is possible. Without agreement between the parties, the subdistrict court ultimately decides whether to terminate the employment contract.
See the overview and the detailed pages about a disrupted employment relationship and dismissal for conduct or behaviour.
Have the records, improvement plan and any proposed settlement agreement assessed before agreeing to termination.
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