Do employers need to consider alternative work before dismissing an employee who is underperforming?

There is no specific statutory requirement for employers to consider alternative work for an employee who is underperforming. However, in the event that a dismissed employee brings a claim for unfair dismissal, the employment tribunal is likely to take into account whether or not the employer made a reasonable effort to find alternative employment to avoid having to dismiss, when determining if it acted fairly. Employers should consider available alternative employment for employees who are unsuitable for their existing position due to their poor performance and who have not responded satisfactorily to warnings, counselling and/or training. Alternative work should be a last resort to avoid having to dismiss; it is not something that the employer should broach at the start of the performance improvement process. That the alternative employment on offer may be of a lower status and/or pay does not necessarily mean that the employee facing dismissal will deem it unacceptable. Employers should also consider alternative work on a group-wide basis, where applicable, particularly if the employee in question is flexible as to where he or she is prepared to work.

Unless there is a clear express contractual term entitling the employer to demote the employee or vary his or her role, it will need to obtain his or her agreement to the alternative work.