Employee underperformance has been a hot topic in many workplaces. Much of the debate has revolved around whether it can be grounds for dismissing an employee for personal reasons. On the other hand, many employees are now asking, with good reason, how much work is enough and when have you fulfilled your duty.
The Working Time Act was revised in 2020, and it obligates the employer to ensure that the average working time of an employee does not exceed 48 hours a week. The average working time is calculated over a period of four months, and the hours of overtime are included in the total. The Occupational Safety and Health Act additionally states that travel for work outside working hours should also be taken into account as a workload factor.
Employers must monitor working hours
Working hours monitoring is the employer's responsibility, meaning that the employer is obligated to maintain a working time register. The register must contain entries on the regular, additional, overtime, emergency and Sunday work hours and the increments paid.
But it is another issue entirely if more work is actually being done than is entered in the register. Employees’ experiences of their workload are concerning, as shown by TEK's labour market survey in 2017. Up to 35 percent felt that they recovered poorly from the stress caused by work after their workdays and about half reported that they recovered only moderately well.
Underperformance at work only rarely provides valid grounds for dismissal. The employee’s duty to be loyal to their employer is described in chapter 3, section 1 of the Employment Contracts Act. According to the provision, employees shall perform their work carefully, observing the instructions concerning performance issued by the employer within its competence.
TT:2001-43: The results achieved by the accounts payable manager at work had, despite notices and warnings, essentially fallen short of the standard that could be reasonably expected from the employee. The employer had, taking into account the overall circumstances, had grounds equivalent to the reason for termination for assigning the employee to the latter task and, following the employee’s refusal to perform this task, for terminating their employment contract.
The extent of an employee’s obligation to work is usually determined according to the duties set out in the employment contract. The looser this agreement is, the wider the scope of duties can be. On the other hand, if an employee’s duties are unclear, neglecting the duty to work due to this lack of clarity cannot be assessed as severely as the failure to perform clearly defined duties or duties that are known to the employee.
Underperformance is a term that is commonly used by employers, but it has no precise legal meaning. Sometimes you also hear employers talk about employee inefficiency. An underperforming employee does not, strictly speaking, neglect their duties or violate the instructions they are given, but they still do not deliver adequate results.
For employee underperformance to be grounds for termination, the employer would have to demonstrate that the failure to deliver results or reach a target is attributable to the fault or negligence of the employee.
The offence must also be essential in nature. The disputes arising from inefficiency as grounds for termination typically concern professionals in managerial positions or working in sales.
HHO 2.2.2007 S 05/1061. The mere fact that the company had not in the year in question achieved its targets set out in the budget says nothing about the work of the director of the office. Competition in the company’s line of business had increased and this had affected the company’s performance. There was also very little evidence of the director’s alleged negligence. There were no grounds for termination.
Employees need to be warned first
According to chapter 7, section 2, subsection 3 of the Employment Contracts Act, employees who have failed to fulfil their duties arising from the employment relationship or committed a breach thereof shall not be given notice, however, before they have been warned and given the chance to amend their conduct. In addition, before giving notice, the employer must hear the employee in the manner referred to in the law and, after this, also find out whether it is possible to avoid giving notice by placing the employee in other work.
Sometimes inefficiency may still constitute grounds for termination. If the employee’s performance can be compared with a real control group to show that performance has indeed declined, this may be grounds for termination. However, the employer should first make sure that the employee has been given adequate instructions and see whether it is possible to address their underperformance.
The employee’s overall circumstances should also be considered in the assessment. Things may come up during employment that temporarily lower an employee’s ability to work. As of 1 June 2023, the employer’s duty to exercise care is included in the Occupational Safety and Health Act, under which employers shall consider the employees’ personal abilities and their occupational safety and health needs. Professional and managerial staff have a tendency to work more, rather than less, than their regular hours. Ideally, the workload should be calculated correctly to start with, so that employees will be able to complete their tasks within the given time frame.
A healthy and happy employee also produces better solutions for their employer.
The author works at TEK as an employment lawyer.