Dental bulletin – Top tips for dealing with Employee underperformance


Employee underperformance

  • Set the required standard

Aside from the most obvious requirements of a role, it is important to draw employees’ attention to the required standards at the outset of employment, and then, if it becomes necessary, for the purposes of managing underperformance. If performance targets apply, an employee should be made fully aware of these and of the possible consequences of not meeting them.

  • Use probationary periods effectively

Periods of probation (usually between 3 and 6 months) are an ideal time to assess employee suitability, since a practice’s exposure to claims during this period is limited.

If an employee does not perform to the required standard they may be dismissed before the probationary period expires. There is no requirement for an employee to be allowed to complete the full period (unless this is a specific term of their contract which would be unusual). Alternatively, at the end of the probationary period, you may confirm satisfactory completion of the probation.

It is important that you diarise the period of probation carefully to ensure the end date is noted and that a decision as to a satisfactory completion (or otherwise) is reached and communicated to an employee before this.

  • Deal with a problem at an early stage

Addressing performance issues as soon as they arise is important from a legal perspective and has a number of advantages for all involved. For example:

  • Employees are more likely to turn their performance around if concerns are highlighted early than if matters are left to fester.
  • Offering training and support may result in positive outcomes and is less time consuming and costly than a poor performance dismissal and having to recruit to replace a staff member.
  • Being able to demonstrate that an employee has been given support and the opportunity to improve will greatly improve the chances of effecting a fair dismissal if matters progress.

The practical reality of confronting an employee over perceived performance issues can seem daunting, leading to matters being left to drift, and addressing underperformance can also be seen as time consuming. However, regardless of the reasons for doing so, a failure to address performance issues upfront could have adverse consequences for a practice well beyond avoiding unfair dismissals.

Performance management is an important aspect of maintaining positive performance and moral, not least because it can be de-motivating for productive members of the workforce if the underperformance of colleagues is ignored. Furthermore, incompetence where strict heath and safety procedures are required can place an employee, as well as colleagues, at risk of breach of health and safety regulations. Performance issues which have not been identified or addressed may also present a significant stumbling block to you if you end up contemplating dismissal at a later date, for another potentially fair reason.

  • Avoid a heavy-handed approach

You should take care not to unduly criticise or humiliate poorly performing employees in front of colleagues. Reprimanding employees in front of their colleagues could leave them feeling humiliated and intimidated to such an extent that it amounts to a breach of trust and confidence, entitling them to resign and claim constructive unfair dismissal.

  • Consider whether performance is really the issue

When investigating performance problems, you may find other issues that need to be addressed instead of, or in addition to, the poor performance. These could be:

  • ill health or disability;
  • childcare or caring responsibilities;
  • poor management within a team;
  • harassment or bullying from a manager; and
  • excessive workload leading to the inability to deliver and stress.

You will need to seek to address these if they arise or create additional legal liabilities. If poor performance is caused or worsened by a disability, you will need to comply with the provisions of the Equality Act 2010. If a disability is identified any action taken will need to be a proportionate means of achieving a legitimate aim. Before reaching any decision, you will need to consider reasonable adjustments that could be taken to support an employee. These might include supportive steps such as additional training or adjustments to the actual capability procedure.

Topics of interest

Associate dentist and employment status

As practice owners will be aware, the HMRC practice and guidance on this issue is set to be withdrawn from 6 April this year. This is guidance which currently refers to the BDA approved associate agreement and states that where such agreements are used and followed, the income of an Associate Dentist will be treated as trading income rather than employment income.

Following 6 April, the status of new and ongoing Associate Dentist engagements is to be considered in line with the general guidance on determining employment status and HMRC’s Check Employment Status for Tax (“CEST”) tool.

This doesn’t mean that Associate Dentists will suddenly no longer be self-employed and in practice is likely to have little impact. However, it will be a useful reminder to consider the status of Associate Dentists and how you engage them. There are two things to consider when it comes to Associate Dentists, their status from an employment law perspective, and from a tax perspective. HMRC guidance relates to Associate Dentists’ status from a tax perspective. Their status from an employment law perspective is completely separate, and the issues are determined by different tribunals meaning they can be different.

Cases concerning the employment status of Associate Dentists are rare, which is probably because the position is generally accepted within the dental profession. However, their status was something considered last year in the case of Hughes v Rattan [2022] EWCA Civ 107 which gained a lot of attention. In this case the Court of Appeal considered whether a dental practice owner was liable for the treatment provided to a patient by one of the self-employed Associates Dentists engaged at the practice. Although the issues considered were in relation to non-delegable duties of care and vicarious liability, there are some useful points to take in the context of Associate Dentists’ employment status. These are from the Court of Appeal’s consideration of whether the Associate Dentists’ relationship with the practice owner could properly be described as being ‘akin’ (or ‘analogous’) to employment.

The Court of Appeal found that the relationship was not akin to employment, with the most important factors being that the Associate Dentists:

  • were free to work at the practice for as many or as few hours as they wished;
  • could work for other practices and business owners;
  • were free to choose which laboratories they used (and shared the cost of disbursements to laboratories);
  • were responsible for their own tax and national insurance (and were treated as independent contractors by HMRC);
  • shared the risk of bad debts;
  • were required to carry professional indemnity insurance and to indemnify the practice owner against claims in respect of their treatment of patients;
  • paid for their own professional clothing, development, and for equipment they wished to use which was not provided by the dental practice; and
  • were not subject to a disciplinary or grievance procedure.

In addition, the practice owner had no right to control the clinical judgments made, or manner of treatment conducted, by the dentists;

Factors that were seen to be indicators of a relationship akin to employment included that:

  • the practice owner determined practice opening hours, provided equipment and facilities;
  • the practice owner had a limited degree of control to ensure that NHS courses of treatment were completed within a reasonable period of time; and
  • the Associate Dentists were under a contractual duty to follow the practice’s policies and procedures, but there were none relevant to show control.

However, despite their existence, these indicators did not outweigh the factors pointing the other way.

This is useful information for practice owners to take into account when looking at the relationship they have with their Associate Dentists and how this works in practice. Are there factors which could mean they are actually engaged as workers or employees if the question was ever tested?

If you have any question in relation to these topics or employment law in general please contact Catherine Hope at catherine.hope@sintons.co.uk.


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