What Is a Performance Plan? With Template and Example

Performance plans offer employers a way of helping employees who are struggling in their position. Instead of directly reprimanding or even terminating employees, employers can propose a helpful plan and offer supporting materials for further aid. Performance plans have specific requirements, however, for more effective outcomes.

In this article, we discuss what a performance plan is, how to write one and offer a template and example.

What is a performance plan?

A performance plan or performance improvement plan (PIP) is a formal business document explaining goals for a particular employee. It also outlines potential performance issues hindering the employee's progress in reaching those goals. Performance plans have a generally poor reputation as they often signify impending termination. However, they're meant to encourage employees to do better.

Related: Using Performance Management in the Workplace

How to write a performance plan

Here are some steps to follow when writing a performance plan:

1. Identify performance or behavioral issues that need improvement.

2. Explain the level of performance and behavior expected.

3. Supply helpful suggestions for employee improvement.

4. Schedule progress meetings with the employee.

5. Outline consequences for not meeting standards.

1. Identify performance or behavioral issues that need improvement.

The intent of issuing a PIP stems from problems with employees. These problems can either be performance-related, behavior-related or a mixture of both. When creating a performance plan for your employee, identify the issue needed for correction.

2. Explain the level of performance and behavior expected.

Along with identifying a particular problem, you also need to explain expectations or set specific, measurable goals for them to reach. For example, if performance is measured by meeting a task quota, reinforce the quota minimum for the employee. Your employees need a basis for improvement or a specific goal to reach.

3. Supply helpful suggestions for employee improvement.

Once you've set expectations for your employee, go a step further and provide helpful resources for improvement. Depending on the role, these resources often include additional training, informational resources such as manuals and even physical tools.

4. Schedule progress meetings with the employee.

Once you give your performance plan to your employee, you need to meet with them occasionally and discuss their performance. Within the plan, set a schedule for meetings or at least a loose time frame in which the employee can schedule better times for themselves.

5. Outline consequences for not meeting standards

All performance improvement plans need to have a time frame for improvement. Explain in your plan that consequences are handed out to those who fail to meet requirements. Provide further detail by outlining those specific consequences and what they include.

Related: How To Prepare for a Performance Evaluation

Performance plan template

The following template outlines the necessary sections for a performance improvement plan:

Supervisor: [Your name, job title]

Team member: [Team member's name, job title]

Date: [Date]

Reasons: [Reason for PIP issuance]

Expectations: [Explanation of required expectations]

Suggestions: [Helpful suggestions]

Schedule: [Meeting schedule]

Consequences: [Potential consequences]

Manager's signature: [Signature of manager]

Team member's signature: [Signature of team member]

To upload the template into Google Docs, go to File > Open > and select the correct downloaded file.

Performance plan example

The following example uses the template in a real-world scenario:

Supervisor: Victoria Sanchez, Human Resources Manager

Team member: Carlisle Bertram, Call Center Representative - Team B

Date: January 5, 2023

Reason: Due to poor performance on the call center floor, I am issuing this performance improvement plan. Your sales quota has steadily declined over the past two months. As of last week, you only reached 20% of the established goal for all representatives.

Expectations: You have one month, starting January 6, 2023, and ending the week of February 7, 2023, to increase your sales quota to at least 85% of the required goal for the period. Beyond this performance improvement period, you will be expected to eventually reach the minimum quota by the end of the following period. All call center representatives are held to the same standard.

Suggestions: You will find links below to helpful articles within our database. I am also making myself fully available to you for questions throughout the period. I will send you an instant messenger invite shortly.

Schedule: Because Fridays are often less intense, I propose we meet every Friday during the period as soon as you come into work. You will report to my office at 8:00 a.m. on January 10, 17, 24 and 31. Your final check-in is scheduled for February 7. Please let me know if you cannot make one of these meetings, and we will reschedule as needed.

Consequences: Failure to meet the expectations set within this plan by February 7 will result in immediate termination. If requirements are met by February 7, but the full quota is still not reached by the end of the following period, you will be written up. There will only be one write-up. Failure to meet expectations in the third period will result in termination.

Manager Signature: Victoria Sanchez

Employee Signature: Carlisle Bertram

Related: Why Performance Management Is Important for Your Team

Frequently asked questions

The following list exhibits some of the common questions surrounding performance improvement plans:

How do I know when a PIP is necessary?

Although performance improvement plans are not required, they help hold employees accountable for their past work. A PIP becomes a useful step when an employee has a short-term record of diminishing quality and work performance. These plans allow management to intervene, address the issue and provide help for correcting it. PIPs are often the last effort to save an employee from termination.

What is the difference between a reprimand and a PIP?

The content and overall goal of a PIP is similar to that of a general reprimand or write-up. However, these are only written warnings placed on file without offering steps to address the situation. Alternatively, performance plans outline the problem and the necessary steps for remedying it.

What if performance decreases again after the successful completion of a PIP?

Many employers develop a two-phase PIP process. The first phase is the initial plan, and the second phase is further monitoring after the improvement period's completion. The second phase often includes more time for further evaluation with less frequent meetings. The full PIP period officially closes once the employee's requirements are met.