Performance management works a lot like a GPS. You set the destination, check your progress along the way and adjust when things go off course.

For most businesses, the hard part isn’t knowing that performance matters. It’s having a clear, fair process to follow when someone isn’t meeting expectations.

Here’s how to set one up.

1. Set clear expectations from the start

Your team can’t hit a target they can’t see.

Make sure each person knows:

  • What their role is responsible for

  • What good performance looks like

  • How their performance will be measured

  • What happens if expectations aren’t met

Put this in writing. A position description and agreed goals give you both something to refer back to.

2. Give regular feedback

Don’t save feedback for an annual review.

Short, regular catch ups help you spot issues early, while they’re still easy to fix. Be specific. Talk about what you’ve seen and what needs to change.

3. Support people to improve

When someone is falling short, start by asking why.

They may need training, coaching, clearer instructions or better tools. Offer that support and agree on a reasonable timeframe to improve.

4. Measure progress objectively

Base your view of performance on evidence, not impressions.

Use a mix of:

  • Results against agreed goals

  • Customer or client feedback

  • Feedback from colleagues, such as a 360 degree review

Keep notes as you go. Dates, what was discussed and what was agreed all matter if things don’t improve.

5. Follow a fair process if performance doesn’t improve

If performance is still below expectations after support and a reasonable time to improve, you may need to take formal action.

In Australia, the Fair Work Act 2009 sets the rules. If an employee is dismissed and makes an unfair dismissal claim, the Fair Work Commission looks at whether the process was fair. In general, that means the employee:

  • Was dismissed for a valid reason related to their performance

  • Was told clearly what the performance concern was

  • Had a genuine chance to respond

  • Was allowed a support person in meetings about it, if they asked for one

  • Was warned their job was at risk and given time to improve

Not every employee can make a claim. In general, they need to have worked for you for at least six months, or 12 months if you have fewer than 15 employees. Employees earning above the high income threshold who aren’t covered by an award or enterprise agreement can’t claim.

If you have fewer than 15 employees, including regular casuals, the Small Business Fair Dismissal Code also applies. Your own policies and any modern award or enterprise agreement may add further steps.

If you’re unsure, check the Fair Work Ombudsman website or get advice before you act. This article is general information only. It isn’t legal advice for your situation.

The bottom line

A clear performance process protects your business and gives your team a fair chance to succeed. Most issues can be fixed early with clear expectations and regular conversations.

If you’d like help setting up a performance process, or you’re managing a performance issue now, we can help. Get in touch.