Termination of the employment contract when the employee does not live up to expectations: what should the employer and employee know? | Business

However, what to do when the employee’s work results do not meet the employer’s expectations? How to legally terminate the employment contract in such cases? What should employees know to protect their interests and avoid wrongful dismissal? All these questions are answered by Laura Jodeliukaitė, lawyer of the professional association of lawyers AVOCAD.

Company photo/Laura Juodeliukaitė

If the employer determines that the employee’s work results are unsatisfactory, and the trial period has not yet ended, the employer may, before the end of the trial period, make a decision to terminate the employment contract with the employee on the basis of Article 36 of the Labor Code, after notifying the employee in writing three working days before the end of the employment contract, and not pay severance pay.

“If the employee’s trial period has ended, terminating the employment contract with the employee due to the employee’s unsatisfactory performance takes longer and becomes more complicated,” the lawyer notes.

According to her, at the end of the employee’s trial period, the Labor Code gives the employer the right to terminate the employment contract if the employee does not achieve the agreed work results according to the performance improvement plan. The Labor Code stipulates that the employee’s work performance can be a reason to terminate the employment contract if the employee’s work shortcomings and unachieved personal results have been indicated to the employee in writing and a performance improvement plan covering a period of no less than two months has been drawn up and the results of the implementation of this plan are unsatisfactory .

The lawyer notes that in order to legally terminate the employment contract, it is not enough for the employer to inform the employee that his work results are unsatisfactory, according to her, it is necessary to follow this specific procedure for terminating the employment contract:

Firstly, the employee must be informed in writing of the shortcomings of his work and unachieved personal results;

Second, the employer and the employee must make a performance improvement plan for a period of no less than 2 months;

Thirdly, when the expected deadline for the implementation of the performance improvement plan has arrived and the results of the implementation of the plan have been evaluated, it will be determined that the results of the implementation of this plan are unsatisfactory.

What you should pay attention to:

When pointing out the shortcomings of his work to the employee, the employer should not limit himself to the indication that the employee is not working properly, but to indicate which specific results and goals the employee did not achieve. The purpose of the established legal regulation is to allow the employee to correct himself and it aims to ensure that the employer actively participates in assessing the employee’s individual reasons for not achieving work results, and that the employee is provided with all the conditions to properly assess the shortcomings of his work and correct them.

When a performance improvement plan is drawn up, the employer must properly inform the employee of the consequences of not implementing this plan. From the employer’s information, the employee must clearly and unambiguously understand (and not assume or guess) that if the agreed work results are not achieved according to the performance improvement plan, the employment contract with the employee will be terminated.

The Labor Code regulates that a performance improvement plan must be drawn up jointly by both the employee and the employer, so such a plan also requires the employee’s approval. If the employee does not agree to such a plan, does not sign it, and the employer terminates the employment contract, the dismissal of the employee in such cases may be recognized as illegal.

The performance improvement plan should be as specific as possible. The desired results should not be named as: work more efficiently, etc. It should be clear from the plan what specific results the employee must achieve in order to avoid possible dismissal. In order to assess whether the employer has objectively evaluated the results of the plan, clear criteria must be established, from which it would be possible to judge when the plan for improving the results can be considered fulfilled (for example, whether it is necessary to achieve 100% of the relevant indicators for the fulfillment of the plan, or whether only the implementation of a larger part of them is sufficient ).

According to AVOCAD’s lawyer, the employee’s performance improvement plan must not set such results and goals that are objectively impossible to achieve. The results improvement plan must be realistically implemented, the goals set for the employee are implemented and related to the functions performed by the employee.

Thus, it will be possible to terminate the employment contract with an employee due to his unsatisfactory work results only if the employee does not achieve the agreed results according to the performance improvement plan, and in addition, the employee’s dismissal procedure will be properly completed.

According to lawyer Laura Juodeliukaitė, it should be remembered that a dismissed employee will have to be paid a severance payment equal to two of his average wages, and if the employment relationship lasts less than one year, a severance payment equal to half his average wages. In addition, the employee must be notified of the termination of the employment contract in accordance with the procedure established by the Labor Code.

When the employer is not satisfied with the employee’s work results, the employer can also offer the employee to terminate the employment contract by agreement of the parties. Such an offer should be submitted in writing, and the offer should set out the terms of termination of the employment contract (from when the employment relationship ends, what is the amount of compensation, what is the procedure for granting unused vacation, settlement procedure, etc.). The employee’s agreement with the employer’s offer should also be expressed in writing.