4 Economic Alternatives to Dismissing an Employee

Whether your company is under-resourced or an employee is constantly under-performing, there comes a time where it is inevitable that businesses lay-off employees. However, you may be surprised that sometimes this doesn’t necessarily have to be the case. If you are considering letting someone go, make sure you consider these 4 points to ensure you are not losing a valuable employee unnecessarily.

1. Reassigning

Just because an employee that does not perform well in their current position does not mean they are a ‘bad’ employee or lacking in capability. It may simply be a mismatch between person-job fit. Before firing an employee, consider alternative positions that they are a better fit for. Please note, that this is not a suggestion to move a ‘poor performer’ to another department, but rather an instruction to look and see if there truly is a position they would be well suited for. If you decide to reassign the employee to another role, to ensure a smooth transition, it is advisable to give the employee’s new manager some recommendations on strategies that have been successful in the past and highlight the strengths you believe the individual possesses.

2. Retraining

If an employee cannot perform their tasks, they may require additional training to build their capability in a certain area. If the employee wasn’t thoroughly trained and educated, or if their job description has changed significantly since they were recruited, they may not have the necessary skills to meet expectations. If this is the case, re-training or upskilling the current employee is more cost effective than recruiting, on-boarding or training a new employee for the role. Conducting an assessment on whether an employee requires further training will provide a good indication of their skills, and can assist in deciding if they have the right resources for the job.

3. Performance Improvement Plan

Performance plans are a great way to set expectations and clarify objectives. You could set a 30, 60 or 90 day plan. Your performance plan should state the specific performance areas to be improved; it is also helpful to provide examples where possible. State the level of work performance expected and the timeframes of deliverables. Identify and specify the support and resources that you will provide and notify them of additional resources available. Ensure the employee is clear about the measures you will be using to review their performance and progress. Monitor the plan, and communicate your feedback to the employee at specified meeting times.

4. Disciplinary Action

Given there are many legislative requirements to consider when an employee misbehaves, it is advisable to have a Disciplinary Action Plan that may be utilised when counter-productive work behaviours occur. It is important that employees are aware of what behaviour is unacceptable and are fully aware of the consequences of engaging in such behaviours. Some disciplinary actions may involve a form of counselling or training sessions, warnings, or suspension from work.


There are of course preventative measures that are time and cost effective. Many revolve around recruiting the right employee for the role and the organisation. Our partner company Psych Press has many Talent Management Solutions which can be tailored to suit your company’s needs. If you need any advice, give one of their helpful consultants a call on (03) 9670 0590.