The PIP is simply a way of getting rid of you
In recent years, performance improvement plans have become an increasingly common precursor to dismissal. Most employers use performance improvement plans to genuinely improve an employee’s performance. Some, however, may have already decided to dismiss the employee. The performance improvement plan is simply a way to establish a valid reason for doing so. Can you be dismissed for refusing to agree to a PIP? is more relevant than ever as employers seek to extract more and more productivity and used as a dismissal tool.
So, what happens if you refuse to participate in a performance improvement plan? An unfair dismissal case heard by the Fair Work Commission in March helps answer this question. It involves an employee who, among other misdeeds, asked a job candidate when she intended to have children. The employee was subsequently issued a performance improvement plan, which he refused to participate in. Let’s look at how the case unfolded.
“In Chinese culture, this question is ok:” Coordinator receives warning for discriminatory behaviour
Since April 2018, Jeff Li had been employed as a Senior Import and Export Coordinator for global research company PPD Australia PTY LTD. He was considered a good employee up until March 2021, when Mr Li interviewed three female candidates. Each later complained to his manager about the inappropriate way he conducted their interviews. One of the candidates complained that Mr Li was “really rude,” while another that she had been “put down” by him. The third candidate, however, accused him of something far more serious.
“During the interview, I was asked questions about my marital status and plans for having kids,” said the candidate. “I didn’t know how to respond to those questions back then. I didn’t have the gut to say it straight out but I don’t appreciate being asked these questions.”
When asked about these incidents, Mr Li initially denied what he characterized as the “untrue remarks of the interviewee”. But he later admitted to PPD’s head of HR that he had asked the candidate discriminatory questions, explaining the reason for doing so thusly: “I was trying to protect the company as a lot of training needed to be done and then someone who may get pregnant would just go on leave,” said Mr Li.
Mutual cultural understanding
Mr Li also explained that because he and the candidate shared a mutual cultural understanding. That he was justified in asking such questions. “This candidate have the similar background, Chinese background,” said Mr Li. “In Chinese background – Chinese culture, this question is okay, it’s common questions.”
During Mr Li’s unfair dismissal hearing, PPD submitted to the Fair Work Commission that on 16 April 2021, it’s head of HR had given Mr Li a “verbal warning”. He was told that his behaviour had been unacceptable and was in breach of company policy and discrimination laws. Mr Li, however, denied ever receiving the warning.
The employee is issued with a performance improvement plan
In the months following this incident, Mr Li was involved in three more incidents of inappropriate behaviour. The first one, he undermined a management decision in response to his unsuccessful application for a promotion. In the second, he was disrespectful to his line manager. And in the third, he refused to perform duties related to mentoring new staff members.
On 20 July 2021, Mr Li was on his first day of annual leave when he received a warning letter from PPD, which was couriered to his home. The letter referred to “recent behaviors displayed” by Mr Li, then detailed the four incidents of inappropriate behaviour. It also notified Mr Li that he would be placed on a performance improvement plan:
“Considering the above situations, we are issuing you a 1st warning letter and notifying you that you will be placed on a Performance Improvement Plan (PIP). Once you return from your vacation. If your behaviors don’t improve during the course of the PIP, your employment with PPD may be terminated. I will hold a meeting with you to discuss this in more detail once you return from vacation. This should be around mid-August 2021.”
Unfair dismissal hearing
At Mr Li’s unfair dismissal hearing, PPD’s head of HR admitted that prior to issuing the warning letter, he hadn’t investigated nor discussed the three latest allegations of inappropriate behaviour made against him. He also acknowledged that sending the letter to Mr Li on his first day of leave was “not ideal,” but said he hoped it would give him time to reflect on his actions.
The coordinator rejects the performance improvement plan, accuses employer of “workplace bullying”
On 5 August 2021, Mr Li emailed a complaint to PPD’s “corporate compliance.” He alleged that the warning letter was “unlawful” and a “fabrication to retaliate [against] me.” He also said it was tantamount to “workplace bullying and oppression” and had caused him “mental and psychological pain.”
On his return to work, Mr Li met with his manager and the head of HR to discuss his performance improvement plan. Mr Li was told that it would go for three months and that if he failed to show behavioural improvements in that time, his job would be at risk. Mr Li said that he wouldn’t participate in the plan because he believed it was invalid. He once again denied the allegations of inappropriate conduct made against him.
The employee is informed of his dismissal indirectly
On 3 September 2021, a group of PPD managers received an email informing them that Mr Li’s had been dismissed.
“Hi Team,
FYI Jeff’s last day will be 6th Sept.
For future queries related import/export, trade compliance of Australia & New Zealand, please keep reaching out […] [email].” Shortly after this email was sent, it was forwarded to Mr Li by a colleague who wished him well for his future endeavors. Mr Li then emailed his manager, saying that it was “ridiculous that I have not received notice from you as my manager.”
Li then met with his manager and the head of HR and was told he could still take part in the performance improvement plan if he wished. Mr Li, however, told them that he wouldn’t take part. He would later argue to the Commission that his dismissal was effectively a fait accompli, and that he wasn’t afforded the opportunity to say otherwise.
Three days later, Mr Li received his letter of termination. The head of HR told the Commission that he was delayed in sending the letter because he “had a very busy day” on 3 September.
The employee submits an unfair dismissal application with Fair Work
Seeking reinstatement of his position, Mr Li submitted to the Commission that he had never done anything wrong and that his manager held a grudge against him. He argued that his performance improvement plan was not only “invalid,” but a “set up” designed to terminate his employment.
His reasoning for this was because it was based on the incident in which he asked discriminatory questions, which he argued had been resolved. Also, that he was falsely accused of the three other instances of inappropriate behaviour.
PPD, on the other hand, argued that Mr Li was fairly let go due to his unwillingness to participate in a performance improvement plan. The company said that this amounted to a failure to comply with a reasonable and lawful direction in breach of Mr Lin’s employment contract.
Was the employee unfairly dismissed for rejecting the performance improvement plan?
At the Commission hearing, Deputy President Amanda Mansini assessed the incident in which Mr Lin asked the job candidate about marriage and children. She accepted that it was discriminatory behaviour “and at the very least not justified and inappropriate.”
However, Deputy President Mansini described the manner in which Mr Lin learnt of his sacking via a colleague’s email as “deplorable.” She found that this was one of many procedural failures which later the same day led to a final disciplinary meeting that had a predetermined result.
The Deputy President ultimately found that Mr Lin’s refusal to participate in the performance improvement plan was a valid reason for his dismissal. However, she ruled that it was harsh and unreasonable. As Mr Lin wasn’t given an opportunity to respond to the allegations made against him. Also, because the warning letter didn’t clearly outline his risk of being sacked.
“I am satisfied that the 3 September 2021 meeting was a classic case of an employer ‘going through the motions’ of giving an employee an opportunity to respond when, in substance, a firm decision to terminate had already been made,” said the Deputy President. Deputy President Mansis ruled that Mr Lin’s dismissal was unfair. On the basis of PPD’s “strenuous” opposition to Mr Lin’s reinstatement, he was instead awarded $12,932.52 (plus super).
What can we learn from this unfair dismissal case?
As we saw in the aforementioned case, refusing to engage with an employment improvement plan is a valid reason for dismissal. However, an employer must follow the guidelines of procedural fairness outlined in the Fair Work Act 2009. Mr Lin wasn’t given the chance to respond to the allegations made against him, nor was he warned about his risk of dismissal in writing.
When deciding if a termination is fair, the Commission will consider if the employee was notified for the reason for their dismissal. Also, whether they were given the chance to respond to that reason. And, whether the employee was warned about their unsatisfactory performance prior to the dismissal. These are just a few of the criteria used to judge if a dismissal was unfair.
Have you been issued with a performance improvement plan?
Can you be dismissed for refusing to agree to a PIP?
If you are issued with an employment improvement plan, you ultimately have two choices. You can either resign or agree to participate in the plan. While it may be hard to do so, participation is advised given that refusal can lead to a valid termination. It also gives you an opportunity to engage with your employer and attempt to resolve any issues with them. If you’re unhappy with the plan, you can challenge your employer on its details.
The Fair Work Ombudsman provides a helpful guide on what a performance improvement plan should contain. If you need to request changes to your plan, ensure you do so in writing. And if your employer refuses to accommodate your changes, it’s important to remain persistent. It’s advised to continue politely engaging them both verbally and in writing, while still ensuring that you comply with the performance improvement plan.
Conclusion to: Can you be dismissed for refusing to agree to a PIP?
I hope the article Can you be dismissed for refusing to agree to a PIP? has been helpful, it can be very stressful times. If you need guidance on how to approach your performance improvement plan, or if you have been terminated after refusing one. A Whole New Approach can help. Our team of advisors can provide easy-to-understand advice about your options and help you make a claim with Fair Work. We deal with all workers rights, employment rights, probation period issues, workplace harassment, casual employee rights, toxic workplaces.
Call us today on 1800 333 666 for a free, confidential discussion.
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