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Managing Underperformance Without Damaging the Relationship

A senior administrator at an accounting firm had been with the business for seven years. Twelve months ago her performance started declining — missed deadlines, errors, inconsistent output. Her manager avoided the conversation for six months, partly out of genuine care for the relationship, partly out of reluctance to deal with the difficulty.

When the conversation finally happened, the employee was devastated — not because she was being told about performance issues, but because nobody had told her earlier. “I didn’t know it had gotten to this point,” she said. “Why didn’t someone say something sooner?”

Addressing underperformance is one of the areas where business owners and managers most often get it wrong — and usually in two directions. Some avoid it entirely until the situation is serious enough to require formal action, which creates the worst possible dynamic: the employee has been given the impression everything is fine, and then suddenly it isn’t. Others go straight to formal process, turning a manageable performance issue into an adversarial legal exercise.

 

Why early conversations is the kindest conversations

The employee in the story above captured something important. Delayed performance feedback isn’t kindness — it’s a disservice. People can’t correct a course they don’t know they’re off. When a performance issue is allowed to compound over months without honest feedback, you end up with an employee who’s surprised, a manager who’s frustrated, and a relationship that’s damaged by the absence of honesty rather than by the conversation itself.

Early, direct, specific feedback — framed as caring about the person’s success rather than criticism of them as a person — is both kinder and more effective than waiting until a problem is undeniable.

 

The Fair Work Framework

Under the Fair Work Act, an employer dismissing someone for underperformance is legally required to have followed a fair process — which includes giving the employee clear notice of performance concerns, a genuine opportunity to respond and improve, and reasonable support to do so. Skipping these steps doesn’t just damage the relationship; it creates unfair dismissal exposure.

The practical implication is that early conversation isn’t just the humane option. It’s also what the legal framework requires. A documented history of honest, specific feedback, reasonable improvement timeframes, and genuine support is both good management and good protection.

 

What the conversation actually looks like

Underperformance conversations go wrong most often because they’re vague, personal, or delivered as a verdict rather than an opening for dialogue. “Your work hasn’t been great lately” is not useful feedback. “Over the past six weeks, three reports have been submitted late and two contained significant errors — can you help me understand what’s happening?” is a different conversation.

The goal in the early stages is understanding. Something in the person’s circumstances, workload, capability, or motivation has changed. Sometimes the issue is fixable with support, training, or workload adjustment. Sometimes it’s more fundamental. You can’t know which it is without honest dialogue.

Managing underperformance well requires both the courage to have the conversation and the care to have it in a way that preserves the person’s dignity and the possibility of a genuine resolution.

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