Is a PIP Just a Prelude to Termination?

Performance improvement plans (PIPs) are structured plans used by employers to help their underperforming employees meet required standards. Generally speaking, a PIP will outline areas where the employees’ performance is falling short of expectations and set measurable goals for improvement. The PIP also gives the employee a timeline for meeting these goals and outlines the support or resources they can access.

On the flip side, a PIP also puts the employee on notice that there are concerns about their work that will – if they fail to progress – end up needing disciplinary action. For this reason, a lot of employees believe that a PIP is just a prelude to termination and a way for an employer to “set the stage” so they can be fired.

This is largely untrue

PIPs are often constructive tools that allow employers to:

• Concretely address performance issues: Miscommunications can make a difficult situation even worse. Employees sometimes feel that they’re given vague directives or goals, and a PIP limits the potential for confusion about expectations and goals.
• Ensure fairness and transparency: A PIP encourages an employee to succeed — not fail. At a minimum, a PIP makes sure that performance issues are addressed fairly and the employee is given solid information about what needs to change.
• Retain talent in which they’ve already invested: It’s expensive to find, hire and train new employees, so it’s worth the energy to give an employee a chance to improve their performance instead of immediately resorting to dismissal.

Finally, it is true that a PIP helps document an employer’s effort to improve the employee’s performance, which can protect the company from potential wrongful termination claims.