How to Develop Employee Disciplinary Procedures

Some companies like a formalized disciplinary process, one that reasonably and systematically warns employees when performance falls short of expectations. A progressive discipline system is one in which problematic employee behavior is addressed through a series of increasingly serious disciplinary steps.

A formal progressive disciplinary procedure tends to work best in companies that are highly centralized, where personnel decisions for the entire company are made within one department (most likely HR), which makes sure that each step of the disciplinary process is implemented properly.

The advantage is that the rules and regulations of job performance are consistently communicated to everyone. The disadvantage, however, is that you may be restricted to adhering, lockstep, to your established disciplinary system, even in a situation when you would prefer to immediately terminate an employee.

A formalized disciplinary process doesn’t work as well for organizations that are decentralized, where personnel decisions are made within each office or department on a case-by-case basis in accordance with a company’s general expectations.

If your company is not required to have a progressive discipline system (for example, under a collective bargaining agreement) but elects to implement one, the policy should be very carefully written and administered. If not, the company may find itself having established a contractual arrangement where the company is required to exhaust each progressive step of discipline before it may terminate an employee.

In this situation, a decision to jump immediately to employment termination or harsh discipline can amount to a breach of the contract, and expose the company to damages to the affected employee. You may want to consult with legal counsel to create or review your company’s policy.

If your company elects to adopt a formal disciplinary process, you may want to create some or all of the following phases:

  1. Initial notification

    The first step in a typical progressive disciplinary process is informing the employee that his job performance or workplace conduct isn’t measuring up to the company’s expectations and standards. The employee’s manager typically delivers this initial communication verbally in a one-on-one meeting. Details from this and all later conversations should be documented. The report doesn’t have to be lengthy; a few bullet points highlighting the main topics are perfectly acceptable.

  2. Second warning

    This phase applies if the performance or conduct problems raised in the initial phase worsen or fail to improve, generally by an established time frame. The recommended practice is for the manager to hold another one-on-one meeting with the employee and accompany this oral warning with a memo that spells out job performance areas that need improvement.

    At this stage in the process, the manager needs to make the employee aware of how her behavior is affecting the business and what the consequences are for failing to improve or correct the problem. The manager needs to work with the employee to come up with a plan of action (written, if possible) that gives the employee concrete, quantifiable goals and a timeline for achieving them.

  3. Last-chance warning

    The penultimate phase of discipline, sometimes documented in a performance improvement plan (PIP), usually takes the form of a written disciplinary communication from a senior manager. The document informs the employee that if the job performance or workplace conduct problems continue, the employee will be subject to termination.

    Particularly with a PIP, very specific performance correction steps are laid out, along with specific deadlines by which the steps must be accomplished. What you’re doing here is using the PIP as a tool to assist the employee in gaining (or regaining) an acceptable level of performance — and notifying the employee that his failure to meet this standard will lead to termination.

    If a union contract applies, this step also may involve a suspension, a mandatory leave, or, possibly, a demotion.

  4. Termination

    Termination is the last phase in the process — the step taken when all other corrective or disciplinary actions have failed to resolve the problem.

This description of progressive disciplinary steps is a general guideline and is not intended as a substitute for legal counsel.

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