Performance Improvement Plans: Running PIPs Lawfully In England And Wales

A Performance Improvement Plan, or PIP, is lawful in England and Wales if it's fair, specific, documented and genuinely gives the employee a chance to improve. There's no fixed legal length for a PIP, but 30, 60 or 90 days is common, depending on the role, the seriousness of the issue and the support the employee needs.

The rules below apply to employers in England and Wales. Some principles are similar across Great Britain, but Northern Ireland has different employment law rules, so take local advice if you employ staff there.

For employers, the key isn't to treat a PIP as a shortcut to dismissal. Used properly, it can help you fix underperformance, protect morale and show that your business acted reasonably if the decision is later challenged.

What Is A Performance Improvement Plan?

A Performance Improvement Plan is a formal, written process for managing underperformance. It sets out what is going wrong, what standard you expect, what support you'll provide and when progress will be reviewed.

A good PIP should feel practical, not punitive. It should give your employee a clear path back to the required standard. That means replacing vague comments like your attitude needs work with measurable expectations, such as responding to customer enquiries within one business day or reducing avoidable data entry errors to fewer than three per week.

For an employer in England and Wales, the legal value of a PIP is that it creates a fair and transparent record. If you later need to move into a formal capability, disciplinary or dismissal process, your notes can show that you identified the issue, explained it clearly, listened to the employee and offered reasonable support.

That said, a PIP is only helpful if it's real. If the outcome is already decided, or the targets are impossible to meet, the process can create more risk than protection.

When Should You Use A PIP?

A PIP is usually appropriate where there's an ongoing performance concern that informal feedback hasn't fixed. It's best used for capability issues, such as missed targets, repeated errors, slow turnaround times, poor quality work or difficulty meeting the normal requirements of the role.

You don't need to start a PIP every time someone has a bad week. Before moving to a formal plan, it's usually sensible to speak with the employee informally, explain the concern, check whether anything is affecting their work and give them a fair chance to improve. Keep a short note of that conversation.

A PIP may be appropriate where:

• the issue has continued after informal coaching or feedback
• the performance gap can be described with clear examples
• the expectations are linked to the employee's role, job description, KPIs or reasonable business standards
• the employee has the ability, training and tools to improve
• you can offer support during the review period

A PIP is less suitable where the issue is serious misconduct, such as theft, violence or deliberate dishonesty. Those matters usually need to be handled under your disciplinary procedure rather than a performance improvement process.

You should also pause before using a PIP if the concern may be connected to disability, pregnancy or maternity, mental health, menopause symptoms, caring responsibilities, whistleblowing or another legally protected issue. Menopause symptoms, mental health issues and caring responsibilities aren't always protected characteristics in themselves, but they can create discrimination risks depending on the circumstances. A fair process may still be possible, but you'll need to consider the Equality Act 2010, including whether reasonable adjustments are required.

Is A PIP Disciplinary And Can It Lead To Dismissal?

A PIP isn't automatically disciplinary action. Many businesses use it as a supportive capability process before any formal warning. However, a PIP can lead to disciplinary or capability action if the employee doesn't improve despite clear expectations and reasonable support.

The difference matters because employees should understand exactly where they stand. If the PIP is informal or supportive, say so. If failure to meet the plan could result in a formal warning or dismissal, say that too. Surprising an employee at the end of the process is one of the easiest ways to make it look unfair.

Dismissal for poor performance is usually treated as a capability dismissal. To be fair, you'll generally need to show that:

• there was a genuine performance concern
• you investigated and discussed the concern with the employee
• you gave clear warnings about what needed to improve
• you gave the employee a reasonable opportunity to improve
• you provided reasonable support, training or adjustments
• you followed your own policy and a fair process
• dismissal was within the range of reasonable responses in the circumstances

In England, Wales and Scotland, ordinary unfair dismissal rights usually require 2 years' continuous employment for dismissals with an effective termination date before 1 January 2027. From 1 January 2027, the usual qualifying period will reduce to 6 months. Northern Ireland has different rules, including a usual 1 year qualifying period. In any case, some claims, including discrimination, whistleblowing and certain automatic unfair dismissal claims, can arise from day one.

If your process could result in a formal warning or dismissal, ACAS guidance and the ACAS Code on disciplinary and grievance procedures are important. An employment tribunal can take unreasonable failure to follow the Code into account, and compensation can be increased or reduced by up to 25% in relevant cases.

If you're close to dismissal, read our articles on Navigating Termination of Employment and Unfair Dismissal before taking the next step.

What Should A PIP Template Include?

A strong PIP template gives managers a consistent structure and helps employees understand exactly what is expected. It should be tailored for each employee and role, rather than copied across the business without thought.

Your PIP should usually include:

1. Employee And Manager Details: Record the employee's name, role, department, manager and the date the plan starts.
2. Background And Previous Feedback: Summarise any informal feedback, coaching or prior conversations that led to the PIP.
3. Specific Performance Concerns: List the issues with dates, examples and evidence, such as missed deadlines, quality problems or customer complaints.
4. Required Standard: Explain the standard the employee must meet, linking it to their contract, job description, KPIs or workplace policy.
5. SMART Objectives: Set goals that are specific, measurable, achievable, relevant and time bound.
6. Support And Adjustments: Set out training, mentoring, resources, supervision, workload changes or reasonable adjustments you'll provide.
7. Review Dates: Include weekly, fortnightly or monthly check ins and a final review date.
8. Employee Input: Record the employee's comments, concerns and any barriers they raise.
9. Possible Outcomes: Explain what happens if performance improves, partially improves or doesn't improve.
10. Signatures And Acknowledgement: Ask both parties to confirm that the plan has been discussed and understood.

A lawyer should tailor your PIP template to match your contracts, staff handbook and internal process. If your business uses a disciplinary, capability or performance management policy, your PIP should sit neatly within that framework rather than contradict it.

It's also worth reviewing your staff handbook so managers know when to use informal feedback, when to start a PIP and when to move into a formal capability process. You may also want to look at a Staff Handbook Package if your workplace policies need tightening.

How Long Should A Performance Improvement Plan Last?

There's no statutory minimum or maximum length for a PIP in England and Wales. The period needs to be reasonable for the type of improvement required.

As a practical starting point:

• 30 days may be enough for straightforward issues, such as punctual completion of weekly reports or following an established process.
• 60 days is common where the employee needs coaching and several review points to show sustained improvement.
• 90 days may be more appropriate for complex roles, sales cycles, technical skills or issues affected by seasonal workloads.

The PIP shouldn't be so short that improvement is unrealistic. For example, if a business development manager works on a three month sales cycle, a two week PIP based only on closed revenue may be unfair. A better plan might measure agreed activity levels, pipeline quality, CRM hygiene and follow up rates during the first month, then revenue outcomes later.

Equally, a PIP shouldn't drift indefinitely. If performance is partly improving, you may extend the plan for a short, clearly defined period. If there's no meaningful improvement despite support, it may be time to move to the next stage of your capability or disciplinary process.

Step By Step Checklist For Running A PIP Lawfully

A fair PIP process is usually straightforward, but it needs discipline from managers. Use this checklist before you begin.

1. Check The Evidence: Gather examples of underperformance, such as missed targets, error logs, client feedback, quality reviews or manager notes.
2. Review The Contract And Policies: Check the employee's contract, job description, handbook, capability policy and any bonus or KPI documents.
3. Try Informal Feedback First: Unless the issue is serious, speak with the employee informally and give them a chance to respond and improve.
4. Invite The Employee To A PIP Meeting: Tell them the purpose of the meeting, the concerns to be discussed and whether the meeting is formal.
5. Listen Before Finalising The Plan: Ask whether there are health, workload, management, training or personal issues affecting performance.
6. Consider Reasonable Adjustments: If disability or another legally protected issue may be relevant, consider adjustments before setting targets or deadlines.
7. Set Measurable Objectives: Use numbers, deadlines and quality standards wherever possible, and avoid vague personality based targets.
8. Provide Support: Record the training, mentoring, resources, check ins or workload adjustments the business will provide.
9. Hold Regular Reviews: Meet weekly or fortnightly, give balanced feedback and record what was discussed.
10. Make A Reasoned Decision: At the final review, decide whether the PIP has been passed, extended or escalated, and explain the reasons in writing.

Good record keeping matters, but avoid writing notes as though they're only for a future tribunal. The best records are factual, calm and useful for both the manager and the employee.

Store PIP documents securely and only share them with people who need access for HR or management reasons. Performance records are personal data, so your handling should be consistent with UK GDPR and the Data Protection Act 2018.

Worked Example: A 60 Day PIP For A Sales Employee

Imagine you run a 12 person software business in Manchester. One of your account executives, Priya, has been in the role for 18 months. Her quarterly target is 120,000 pounds in new annual recurring revenue, but she has delivered about half of that for two quarters in a row.

Before starting a PIP, her manager checks the CRM and finds that Priya is also averaging 12 qualified discovery calls per month, compared with the team expectation of 20. Her proposal follow up time averages five business days, while the business standard is two business days. There are no conduct concerns, and customer feedback is positive once she engages.

The manager has already had two informal coaching conversations. Priya says she is struggling with the new CRM and is unsure how to prioritise leads. The business decides to start a 60 day PIP focused on capability and support.

The PIP includes these objectives:

• complete CRM refresher training by 10 March
• make at least 18 qualified discovery calls in month one and 20 in month two
• send proposal follow ups within two business days in at least 90% of cases
• review the pipeline with her manager every Friday at 10 am
• increase qualified pipeline value from 180,000 pounds to 260,000 pounds by the final review

The support includes CRM training, shadowing a senior account executive for two calls per week and a weekly pipeline review. The plan also says that if Priya meets the activity and process targets but revenue hasn't yet closed because of the sales cycle, the business will consider extending the plan rather than jumping straight to formal action.

At day 60, Priya has completed training, improved call volume, reduced follow up times and increased qualified pipeline to 275,000 pounds. Revenue closed is still below target, but two proposals are at final negotiation stage. The business records that Priya has met the process and pipeline objectives, closes the PIP successfully and continues monthly coaching.

The outcome is fair because the targets were tied to the role, the business provided support, the reviews were documented and the final decision reflected the reality of the sales cycle rather than one blunt revenue number.

Legal Risks To Watch Before You Start A PIP

The biggest PIP risks usually come from poor preparation, rushed timelines or hidden motives. If the real reason for the plan is redundancy, personality conflict, whistleblowing, pregnancy, disability or a protected complaint, a PIP can quickly become evidence against the business.

Watch for these red flags:

• Unclear Standards: The employee can't reasonably know what good performance looks like.
• Impossible Targets: The goals are higher than those expected of others in similar roles or can't be achieved in the timeframe.
• Inconsistent Treatment: One employee is put on a PIP for conduct or performance that others are allowed to continue.
• No Real Support: The plan demands improvement but provides no training, resources or management time.
• Predetermined Outcome: Internal messages suggest the decision to dismiss has already been made.
• Health Or Disability Factors: The plan ignores medical information, occupational health advice or possible reasonable adjustments.
• Poor Documentation: Managers rely on memory rather than records of meetings, examples and support offered.

If the employee raises a grievance during the PIP, don't ignore it. You may need to pause, adjust or run parallel processes depending on the issue. If the grievance says the PIP is discriminatory, retaliatory or based on inaccurate evidence, get advice before continuing.

Strong foundations help. Clear employment contracts, job descriptions, KPI documents, onboarding processes and workplace policies make performance expectations easier to prove. For broader people processes, our Guide To Employee Onboarding and Legal Aspects of Performance Management are useful next reads. If your business is growing, it's also worth reviewing your essential legal documents for business.

Key Takeaways

• A Performance Improvement Plan is lawful when it's fair, specific, documented and gives the employee a genuine opportunity to improve.
• Most PIPs run for 30, 60 or 90 days, but the right length depends on the role, the issue and what a reasonable improvement period looks like.
• A PIP should include clear examples, measurable objectives, support, review dates, employee input and possible outcomes.
• A PIP isn't always disciplinary, but it can lead to formal capability action or dismissal if performance doesn't improve after a fair process.
• Check the relevant unfair dismissal qualifying period before relying on length of service, and remember that discrimination, whistleblowing and some automatic unfair dismissal claims can arise from day one.
• Before starting a PIP, check for disability, discrimination, whistleblowing, grievance or health issues that may require a different approach or reasonable adjustments.

If you'd like help with PIP templates, performance management processes, staff handbooks or employment contracts, you can reach us at 08081347754 or team@sprintlaw.co.uk for a free, no-obligations chat.