It is common for an employer to expect certain standards of work performance at the workplace. The Employment Act, 2007 (the Act) allows for an employer who is concerned about the poor performance of an employee to terminate their employment contract.
The following steps should be followed where poor performance is considered as grounds for termination of employment;
Meetings
1) The employer must call the employee for an appraisal or review meeting before taking any action that may result in termination of employment. “…performance improvement must be preceded by an appraisal” Jane Samba Mukala Vs. Ol Tukai Lodge [2013] eKLR
2) The review or appraisal meeting must involve the active participation of the employee. “…a credible performance appraisal process must be evidently participatory” Jane Wairimu Machira Vs. Mugo Waweru and Associates [2012] eKLR.
3) The employer must discuss with the employee the poor performance, identify key performance areas of improvement and give the employee an opportunity to reply or raise any issues or factors that may have impacted on their performance.
4) The employer should place the employee on a Performance Improvement Plan (PIP) for a reasonable period of time. “…In our view 2-3 months would be reasonable” Kenya Science Research International Technical and Allied Workers Union (KSRITAWU) Vs. Stanley Kinyanjui and Magnate Ventures Ltd [2010] eKLR.
5) After the period of improvement lapses, the employer should call the employee for a meeting to review the employee’s performance thus far. This is not a disciplinary meeting but a meeting called solely for the purpose of reviewing the employee’s performance and therefore no drastic can be taken during this meeting. “…that performance monitoring proceedings are not disciplinary proceedings thus cannot be used as a substitute to disciplinary proceedings” Everlyn Lynn Kagendo Vs. Statpack Industries Limited [2013] eKLR.
6) The employer should have records of indicators evidencing a lack of improvement by the employee during the period of the PIP. “…without evidence that the claimants were placed under PIP…and failed to improve, I must hold that the respondent has failed to prove on a balance of probability that the reason for terminating the claimant’s contracts of service… was valid” Peter Kamau Mwaura & another Vs. National Bank of Kenya [2020] eKLR.
7) If at the end of the PIP, the employee has not met the set performance indicators, the employee should be taken through a hearing process before the decision on their continued employment is made.
8) The employer should ensure the meetings and all/any communication between itself and the employee are properly documented.
Decision to Dismiss
Prior to dismissing the employee, Section 41(1) of the Act places an obligation on the employer to call a hearing and at the same time: a) Explain to the employee in a language they understand the reason the employer is considering termination; b) Inform the employee of their right to have another employee or union representative of their choice present during this explanation and c) Inform the employee of their right to make any representations on the allegations or the right for the person, if any, chosen by the employee to also make any representations.
A key procedural requirement is that the employee must be made aware of the required standards. An employer cannot allege “poor performance” on the part of the employee if the employee was not aware of the expected standards of work performance or given a chance to improve their performance.
Guided by the above procedures and requirements, the Court in Abubakar Ali v Central Electricals International Ltd [2019] eKLR noted that:
“The Claimant was not heard after being issued with the notice to show cause. He was not called before a disciplinary panel, and confronted with the allegations made against him. He was not invited to a disciplinary hearing and heard as required under sections 41 and 45 of the Employment Act. There is no evidence on record, to establish that the Claimant performed poorly. No appraisal records, with specific performance targets and indicators, have been exhibited. The Claimant had worked for 5 years and 2 months. He was not at any time, placed on a Performance Improvement Plan (PIP). If it is correct that his performance was poor, the Respondent gave him no time to improve. The Court is satisfied termination was unfair for lack of fairness of procedure and validity of reason”
The jurisprudence by Courts in Kenya slightly varies from South Africa. As was seen in Somyo v Ross Poultry Breeders (Pty) Ltd [1997] 7 BLLR (LAC) where the Labour Appeal Court noted that the requirements to inform the employee of their poor performance and give them a chance to improve (as is required in Kenya) may not apply where;
a) The employee is a manager or senior employee whose knowledge and experience qualify him to judge for himself whether he is meeting the standards set by the employer:
b) The degree of professional skill required is so high, and the potential consequences of the smallest departure from that high standard are so serious, that one failure to perform in accordance with those standards is enough to justify immediate dismissal.
This write-up is for informational purposes only and should not be construed as a legal opinion. If you have any queries or need clarifications, please do not hesitate to contact Gregory Makambo, Partner, (gmakambo@makambolaw.com), Yvonne W. Kariuki, (ykariuki@makambolaw.com) or your usual contact at our firm, for legal advice.