Welcome to this HR Blast from Jaluch. Here we take a look at a few options around dismissal, particularly gross incompetence. Gross incompetence is a concept that is not widely understood by many organisations, but it can be a good option for a quick dismissal of a senior person who has spectacularly failed to deliver!
But let’s start by looking at a few definitions:
Misconduct Vs Performance: Misconduct is about actions that are wilfull, lazy or intentional etc. All these actions are entirely within the control of the employee. In contrast, Performance is about behaviours that are not within the control of the employee.
Most organisations have a disciplinary procedure that sets out the process to follow for acts of misconduct and poor performance. Sometimes organisations have two different procedures, but often the procedure is a combined one. Very serious misconduct that results in summary dismissal is called Gross Misconduct. Very serious poor performance that results in summary dismissal is called Gross Incompetence.
Gross misconduct: This is behaviour in the workplace that is illegal or is such a clear and serious violation of company rules that the employee may be dismissed immediately and without notice.
Gross incompetence: This is behaviour in the workplace that is not deliberate or wilful (i.e. not misconduct), but nevertheless that has had serious consequences. Dismissal is usually with notice.
Gross negligence: This is a legal concept which means serious carelessness. This terminology often causes confusion when deciding whether the negligence is an act of misconduct or poor performance. i.e. which procedure are you following when dismissing? The procedure for gross misconduct where dismissal can be made without notice pay or the procedure for gross incompetence where dismissal usually has to be made with notice pay?
In reality, Gross Negligence should usually be viewed as a performance issue if the behaviour was not intentional. If the behaviour was intentional though, then it should be viewed as misconduct.
For a finding of Negligence, the employee needs to have caused a financial loss to the company as a result of their negligence. Negligence with no attributable financial loss should not result in a finding of negligence.
What Difference Does it Make Whether it is Misconduct or Poor Performance?
The principal difference for employers is in the time it takes to move from the first act of misconduct or poor performance through to dismissal.
When following the misconduct procedure ACAS permits employers to start at any appropriate step of the procedure, depending on what the employee has done. Therefore whilst a first written warning may be issued for a minor offence, summary dismissal may also be the first step for example in the case of theft of company property.
In contrast, ACAS requires employers to work through the poor performance procedure step by step beginning with a first level warning and requiring support, guidance, training and/or coaching to be given at all steps to provide the employee with all possible chances of turning their behaviour around. This is costly both in terms of time and money. The only exception to this rule of progressing step by step across 6-12 months when dealing with poor performance issues is to move straight to a finding of Gross Incompetence. This means that your employee can be dismissed within a few weeks and with none of the usual cost of retraining and support associated with staff being performance managed.
Gross Incompetence should not be used without considerable thought. It is only suitable to reach a finding of Gross Incompetence if the employee under consideration is both experienced and highly trained and the consequences of their actions are significant. Think top team, rather than your average employee!
- A junior employee who makes an error on a sales invoice costing the business a few thousand pounds should not be dismissed for Gross Incompetence. A first level warning for performance and further training is more likely.
However, a qualified highly experienced finance director who fails to submit signed off accounts by the legal due date, which puts the organisation in jeopardy of several sanctions as well as possible adverse press, could be found to have committed an act of Gross Incompetence. He/she should have known better, had the knowledge, skills and experience to have got this right. Their actions weren’t intentional, perhaps they got distracted, but nevertheless, you need to know your finances are in safe hands. No additional training could turn this employee around so it’s safe to treat it as a performance issue but go straight to Gross Incompetence.
- A pilot who is qualified but relatively lacking in experience mistimes the landing and causes damage to the aircraft as a result of partially landing on rough grass. Not intentional so not misconduct, so probably issue a performance warning and require them to under take further training.
However, a highly experienced senior pilot with decades of experience loses concentration and shoots off the end of the runway damaging the plane. Again, not intention but equally you cannot afford to have pilots that miss the runway on your team. Gross Incompetence might be your finding as his/her was not intentional and no amount of additional training would be relevant given their current level of seniority, experience and qualifications.
A fine line…
Some people may consider some of these instances as Misconduct. The reality though is that if you go back to basics, Misconduct is about carelessness, deliberate intent, bad attitude etc, whereas Performance is about someone who is probably out of their depth, with no wilful intent involved. A lot of under performance at senior level can be attributed to those who have been promoted beyond their abilities/potential and no amount of training will be of benefit.
Whilst it is clear that dismissal for Gross Misconduct can be without notice or pay in lieu of notice, there is a question mark as to whether or not notice should be given/paid under Gross Incompetence. On balance, the requirement is probably that unless you have an express term in your contract that states it will not be paid should a finding of gross incompetence be made, then notice should be paid.
A final note of caution:
” In Swanson v. Sternson Ltd., the plaintiff was dismissed for incompetence after 22 years of employment as a technical service representative/salesman. For the last five years of his employment, the plaintiff, then 55, was required to report to a general manager who had instituted “new regimens and protocols” for sales employees. Justice Stevenson held that the employer made no attempts to assist the plaintiff in adapting to the new regimens and protocols and, as a result, “While technically Mr. Swanson failed to comply with his employer’s directions, that failure arose because of the situation the employer had itself created. In those circumstances, I cannot find that Sternson had cause to dismiss Mr. Swanson without either notice or compensation in lieu thereof.”
Line managers confused about what is misconduct and what is poor performance? Line managers unsure of how to tackle sensitive issues with staff? Directors feeling that your HR processes are not aligned with commercial imperatives? Why not speak to Jaluch about training for your managers and/or first line HR staff? It is possible to manage HR in a way that is aligned with business goals and priorities and it is possible to give managers the skills so that they are both competent and confident in their management of staff. Call us!
The information contained within this article is for general guidance only and represents our understanding of employment and associated law and employee relations issues as at the date of publication. Jaluch Limited, or any of its directors or employees, cannot be held responsible for any action or inaction taken in reliance upon the contents. Specific advice should be sought on all individual matters.