Employee warnings

Issuing employees with official warnings is probably the most common form of employee discipline. Warnings are appropriate when the performance or conduct of an employee is significantly unsatisfactory, but the situation is either not serious enough to justify dismissal, or the employee’s actions are considered to be serious, but out of character.

This article is based on writings by HR expert Mike Toten. It has been updated and revised.
 
Issuing employees with official warnings is probably the most common form of employee discipline. Warnings are appropriate when an employee’s performance or conduct is significantly unsatisfactory, but the situation is either not serious enough to justify dismissal, or the employee’s actions are considered to be serious, but out of character.

In determining whether an employee's dismsisal was harsh, unjust or unreasonable, the FWAct (s 387(e)) states that a dismissal may be 'harsh' if it related to unsatisfactory performance before the dismissal. Warnings are therefore an integral part of fairness in any disciplinary procedure.
 
Termination of employment
 
It is also common practice to use warnings as an initial step towards eventual termination of employment, by making it clear to the employee that there are problems yet providing him/her with an opportunity to improve and thus avoid dismissal.
Where dismissal eventually occurs, tribunals and courts are likely to take into account whether the employee received any warnings before dismissal when determining whether the dismissal was unfair.
 
This does not mean that one or more warnings is mandatory in order to provide procedural fairness — the individual circumstances of each case will differ — but warnings are regarded as good practice, both to defend claims of unfair dismissal and as a means of possibly avoiding the need for dismissal.
 
Avoiding dismissals
 
Examples of the latter situation include:
  • Where a warning to improve performance by a certain date has already been issued and when that date occurs the employee has shown significant improvement but not yet reached the required standard.
  • Where performance or conduct is unsatisfactory but it is not possible to establish clearly what has happened, for example, where repeated absenteeism is a problem but it is not possible to verify the reason(s) the employee provides, or there may be some mitigating circumstances.
  • Where performance or conduct are clearly unsatisfactory, but the employee is a long-serving one whose previous record has been satisfactory.
  • Where performance or conduct are clearly unsatisfactory, but it is apparent that outside-work factors are influencing the behaviour — and if those factors are dealt with, performance/conduct are likely to improve.
Types of warnings
 
The following is a typical sequence of warnings. Note however that it is not always appropriate – for example in cases involving serious incidents, a final warning might become stage 1.
 
1. Verbal warning — This involves providing specific details of both the actual deficiency in performance/conduct and the standard of performance/conduct required. Although the warning itself is verbal, documentation by the manager who issues it is still required, and ideally the warning should be issued in the presence of witnesses (one on behalf of the manager and one on behalf of the employee).
 
As they still require paperwork for record purposes, and as it is harder to verify the actual contents of the warning, official verbal warnings are not that common, and most managers prefer to start the process with step 2 below.
 
2. First written warning — The steps are similar to the above, that is the deficiencies and required standards are both explained, the matter is documented and witnesses are present. However, the following extra steps also apply:
  • A copy of the warning is prepared, signed by all parties, given to the employee and another copy placed on his/her employment record.
  • If the employee refuses to sign the warning, he/she should still receive a copy and the warning is still placed on the employment record.
  • The warning may set a time period for improvement to occur and for performance/conduct to be reviewed again. When that period expires, the warning may either cease to have effect or a second (and usually final) warning may be issued (see further discussion below).
  • Where performance or conduct involves a breach of company policy or procedure, state the relevant policy/procedure and provide the employee with a copy of it. This step is particularly relevant to cases involving misconduct.
3. Second written warning — A second written warning is not necessarily or commonly provided — it is more usual to proceed to a final written warning — but could be appropriate in the following circumstances:
  • The employee’s performance conduct is not yet at the required standard, but the previous warning set a deadline or date for review, there has been significant improvement since then and there is considered to be a chance that performance/conduct will eventually reach the required standard.
  • There has been a lengthy period since the first warning was issued — well beyond the deadline or review date it had set. In such cases, it is advisable to set a shorter time frame for the second warning.
Otherwise, the procedural steps are the same as for the first written warning.
 
4. Final written warning — This step applies if performance/conduct fails to improve, does not improve to a sufficient extent, or there are recurrences of misconduct. The procedural steps are similar to those for 2 and 3 above, except that the warning needs to state very clearly that if performance/conduct does not improve to an acceptable level by a specified date, then employment will be terminated.
 
What should a written warning contain?
  • Details of the performance or conduct deficiency, stated in specific behavioural terms — for example details of the employee’s absenteeism record.
  • Reference to relevant company policies or procedures, where the performance/conduct involves a breach of them, and specific description of the breach(es).
  • Details of corrective action required by employee.
  • Time frame — either a deadline for improvement or a date on which performance will be reviewed again.
  • State the intended action if performance/conduct does not improve to a satisfactory level, eg termination of employment.
  • Reference to types and dates of any previous warnings or other disciplinary action
  • Date, names of witnesses, signature of employee (if obtainable), manager and witnesses.
How long should a warning last?
 
When setting a date for review, the seriousness of the problem and the length of time it has been apparent will determine the appropriate length of a warning. Between one and six months is usually appropriate but will vary according to circumstances. For example, in cases of absenteeism, a shorter review period would generally apply to new employees and chronic offenders.
 
If the employee reaches the review date without recurrences and performance is satisfactory, the warning should then be withdrawn and the employee’s slate regarded as 'clean'.
 
Although a copy could remain on the employee’s record, it is unlikely that an employer could rely on it even if problems recurred some time later.
 
For example, if a warning applied for 3 months and the employee’s performance/conduct remained satisfactory for 12 months before problems recurred, the most appropriate step would usually be to issue another 'first warning'. Although that warning could refer to the previous one, terminating employment without first issuing another warning could be regarded by a court or tribunal as procedurally unfair and make it difficult to defend a claim of unfair dismissal.
 
Procedural fairness
 
As with other steps in performance management and termination of employment, it is important to provide procedural fairness to employees even thoughit is not strictly part of WorkChoices legislation.
 
In the case of warnings, this will involve investigating the matter thoroughly, clearly stating the problems, giving the employee an opportunity to respond to allegations, taking any mitigating circumstances into account and allowing the employee to have representation or a witness when the issues are discussed.
 
Be wary about giving more than one 'final warning'. It may be tempting to do so if an employee continues to show some improvement without actually reaching the required standards, or if the problems are sporadic rather than ongoing. Repeated 'final warnings' tend to reduce the impact of all warnings, and may be perceived by others as inconsistent behaviour by the employer.
 
The situations described earlier in this paragraph are usually better handled initially by ongoing performance counselling than by warnings — although warnings may become necessary if counselling fails.
 
Where the organisation has a policy or procedure covering the issue of warnings, ensure that it is not too rigid, eg it prescribes a first and final warning every time. The policy needs to state that that the number and/or timing of warnings will depend on the seriousness of the problems, so that in serious cases the process can be expedited. It should also make it clear that in cases involving serious misconduct there may be no warning process and dismissal may be the only step.
 
For an extensive library of policies, agreements, forms, correspondence and checklists, designed to make human resources (HR) management easy for your business see our HR Advance website.
 

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