Definition:
A Performance Improvement Plan (PIP) is a document that outlines deficiencies in an employee’s work. Ideally, managers use PIPs as a motivational tool to train an employee who is not meeting set goals. However, some employers use these plans as part of the termination process rather than as a good-faith effort to help the employee improve.
How does a Performance Improvement Plan work?
A Performance Improvement Plan is an official statement outlining how an employee should change their behavior, increase productivity, or improve progress towards key performance indicators. These documents are also known as performance action plans, and they record areas where the employee is performing poorly, propose solutions for each issue, and set a timeline for the manager to measure progress.
Managers often create a performance improvement plan after issuing at least one verbal or written warning, although the process varies from workplace to workplace. Once an employee is placed on a PIP, they typically have 30, 60, or 90 days to meet their goals.
Example of a Performance Improvement Plan
Most performance improvement plans include the following sections:
Employee Information: Includes your name, job title, your manager’s name, and the date the plan was issued.
Statement of Purpose: In the first line or paragraph, the manager will summarize the issue. For example, if you have not met sales goals, your manager will outline the target and how your performance has fallen short.
Desired Outcome: The plan should specify what you need to accomplish to succeed within these criteria. For example, your manager might say that you need to achieve 75% of the target in the next 60 days to meet expectations.
Success Metrics: The more specific the performance improvement plan, the easier it is to achieve. Look for metrics that define time-based goals, customers retained or signed, money saved or earned, etc.
Action Plan: The document should outline how you will meet with your manager, what results you will measure, and what the desired outcome will be.
Note: You will be required to sign the performance improvement plan. In general, your signature only confirms that you have received the document, not that you agree with it. If you wish to clarify this, you can add a note saying “signature to confirm receipt.”
Advantages and Disadvantages of Performance Improvement Plans
Advantages:
Opportunity for Improvement: Assuming the employer is acting in good faith and designing the performance improvement plan to clearly identify progress, this document can be a tool to help you improve your performance.
May provide time to look for a new job: In the worst-case scenario, a performance improvement plan can serve as a last warning – thereby encouraging you to start searching for your next role.
Disadvantages:
May fail to identify specific performance indicators: The effectiveness of a performance improvement plan depends on the person who designed it.
Does not guarantee continued employment: Most workers in the United States are employed at-will, meaning they can be terminated at any time, even mid-performance improvement plan.
What should you do if placed on a Performance Improvement Plan?
If your manager places you on a performance improvement plan, review it carefully. Make sure you understand why you have been placed on this plan and what the desired outcome is. It’s important to think about the reasons that may have contributed to your poor performance or low productivity at work. Ask your manager questions, and organize your schedule and work so that you can follow the performance improvement plan and get back on track with your team and company. Ensure you understand what happens if you do not meet the performance improvement plan.
Failing to meet the plan’s goals and deadlines may lead to termination. So if you feel you may not be able to meet the expectations, it’s important to start thinking about your next steps. Perhaps the current job is not the right fit for you, which is perfectly okay. You may want to start looking for a new job thereafter.
Questions
Frequently Asked Questions (FAQs)
Is being placed on a performance improvement plan considered grounds for discrimination?
Being placed on a performance improvement plan (PIP) is generally not considered grounds for discrimination. Historically, courts have not viewed performance improvement plans as “adverse employment actions” in the same manner as termination or demotion. However, it is always wise to seek advice from an employment attorney if you have questions about potential workplace discrimination.
Is a performance improvement plan the first step towards termination?
Ideally, a PIP is not necessarily the beginning of the end of your employment with the organization. However, some companies do use these plans in that way. So, while you should always do your best to meet the goals outlined in the agreement, it is also wise to look for new opportunities when placed on a performance improvement plan.
How long does a written warning stay in my file?
Written warnings and other performance-related documents can remain in your employee file indefinitely. The exact duration depends on company policy. An exception would be if you are working under a collective bargaining agreement or employment contract that outlines your right to have disciplinary materials removed from your file after a specified period.
Source: https://www.thebalancemoney.com/performance-improvement-plan-pip-6890650
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