27 of February, 2025

As a CEO, you strive to maintain a productive and happy team in your company. In your search for a solution, you encounter a problem. You wonder if a dismissal due to poor performance would be a legal termination.

Why? Some of your employees are not meeting performance objectives and this is negatively affecting the rest. There is increasingly more work to do and the team is more stressed. What would you do in this case?

Having to dismiss an employee for poor performance is not easy, but it could happen to you. In this article, we will discuss the causes of dismissal due to poor performance and how to do it fairly and legally.

What is dismissal due to poor performance?

The dismissal due to poor performance is a form of dismissal that can be applied when an employee does not meet the goals or objectives set in his employment contract.

While it is an option to consider, this type of dismissal is a drastic measure.

And should only be taken after all other options have been exhausted, such as dialogue, training, and job change.

You should bear in mind that the employee has the right to a dismissal compensation if it is proven to be unjustified. Therefore, it is also important to consult with a lawyer before making this decision.

In case of being justified, the dismissal due to poor performance does not give the right to compensation or unemployment.

Since it is considered that the employee has not given the expected performance according to what is established in their employment contract.

The best way to avoid dismissal is to make sure to set realistic goals and objectives in the employment contract.

If your employee feels that they cannot meet these goals, they should talk to you and try to reach an agreement. For this, it is necessary to know well what the causes of dismissal could be. Let’s see them.

Causes of dismissal for poor performance

That is, the reasons for justifying the dismissal due to poor performance are several. In the following list, you will find the most common ones.

1. Lack of productivity

The lack of productivity occurs when your worker is not meeting the goals or objectives set.

Or when their results are below expectations.

2. Poor quality of work

Poor quality of work comes up when your worker is not doing a good job.

Either because they do not have the necessary capacity, or because they are not putting in enough effort.

We should consider whether this situation can be solved with a training plan.

3. Lack of initiative

Lack of initiative occurs when your employee does not have the necessary motivation to do his job. Or when he is not willing to do it in the required way.

This could lead to dismissal due to poor performance if not detected in time with a performance evaluation.

It would be convenient to investigate the reason for this. Perhaps the employee is having personal problems within or outside the company.

4. Non-compliance with processes

The non-compliance with established procedures occurs when your worker is not performing his job in the expected or required way.

Also when they make recurrent mistakes. So the first thing you should do is check if they are getting all of the internal communication correctly. And if they understood their tasks.

5. Ignoring orders

Ignoring the employer’s orders is a situation that occurs when your worker is not following your instructions or orders.

Or when they are acting contrary to what is expected of them. It is important to verify whether this is due to lack of knowledge or bad faith.

6. Misconduct

Misconduct occurs when your worker is acting inappropriately. Either because they are committing acts of violence, disrespecting their coworkers or yourself. Or because they are having inappropriate behavior.

This could be the most difficult cause to reverse, especially if this type of behavior is habitual in a particular person.

In summary, dismissal due to poor performance can have multiple causes. This will determine whether or not it is appropriate to carry it out.

If you decide to apply it in your company, it is crucial that you know your rights and obligations, as well as those of your workers.

For this, we recommend that you first consult with a labor lawyer specialized in this type of dismissal.

Is dismissal due to low performance legal or illegal?

Now you have a better understanding of what constitutes poor performance. Therefore, let’s analyze if a dismissal due to poor performance is legal or illegal.

As we were saying before, poor performance is characterized by lack of productivity, quality or compliance. It may also be due to misconduct or attitude at work.

If an employee consistently meets or exceeds the minimum requirements set by the company, their dismissal is likely to be considered illegal.

However, if an employee is unable to comply with even the most basic rules, their dismissal due to poor performance is more likely to be considered a legal termination.

How to justify a dismissal for poor performance

That’s why it is very important to establish the real reasons to avoid possible legal conflicts with the worker.

It should be noted that, for a dismissal due to poor performance to be justified, you must base yourself on objective data and HR reports that can be verified.

In other words, you need to be able to demonstrate that the employee has not met expectations or set standards. Subjective criteria, such as your personal opinion, are not enough to justify a dismissal.

In addition, you must have warned the employee of deficiencies in their performance. And have given them a reasonable period to improve.

If your employee has not made enough progress after this period, you can go ahead with the dismissal.

How to manage an offboarding process with Sesame HR

Not sure how to proceed in the process of a low-performance dismissal? We are here to help you.

With Sesame HR, you can accompany the employee to make the process as fair and clear as possible.

Here are some of the key features of Sesame HR that can help you prevent layoffs. Or, ultimately, manage an offboarding process:

Centralize the management of onboarding and resignations, recruitment processes, and employee climate surveys on the same platform.
Oversee your employees remotely. Manage their logins and logouts, hiring and much more from anywhere through our application.
Get to know your team better and achieve better results. Use People Analytics to generate reports and see all team generated data clearly and simply.
Create a checkout list for your resigning employees with our offboarding software, taking care of the employee experience until the end.

At Sesame HR, we have the tools and resources needed to help you manage such processes professionally and transparently. Request a 14-day demo of our HR software to test the rest of our features.

Customer-oriented, both internally and externally, specializing in the definition and implementation of HR policies, as well as talent management, recruitment, and retention. Strong leadership, communication, negotiation, organization, and team coordination skills. Over 12 years of experience in Human Resources.

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iriserrador

HR Content Specialist

Causes of dismissal for poor performance in companies