What should I do when an employee has a bad reaction to a PIP?

Quick answer: Your next move depends on what their reaction is. Are they simply saying “I’m going to sue” without anything to base their case off, or are they raising a specific reason why they are objecting to the Performance Improvement Plan (PIP)? Either way, the best way to prevent reactions like this moving forward is to switch from a PIP to Progressive Corrective Coaching.

Question: I’m a new manager. I recently had to issue a PIP to a remote employee for failing to do their job. Before issuing the PIP, I made sure I had evidence. There’s a record of them failing to show up for meetings, not responding to messages, and missing deadlines. Before issuing the PIP, I had a one-on-one with the employee to discuss these issues and they became very defensive. Now that the PIP has been issued, they are refusing to acknowledge it and are threatening to sue. I never expected it to escalate like this. How should I respond? Should I have handled things differently? 

Watch our video on the topic below:

What Should You Do When an Employee Reacts Badly to a PIP?

The Legal Side: Any time an employee says they are going to sue you, you want to look carefully at what is going on, including the mechanism you are using at that time. In this case, that mechanism is a PIP.

Don’t let an employee’s threat to sue over a PIP throw you. A threat of legal action does not automatically mean the Performance Improvement Plan was improper or that the employee has a viable legal claim.

Employees can disagree with corrective action and threaten legal action, but that does not automatically mean they have a case. Based on what you’ve told us, you did an important thing correctly: you gathered objective examples of the employee’s performance problems and documented them.

Larger corporations use PIPs all the time, but they also tend to have HR departments, layers of management, legal resources, and systems designed to administer and monitor those plans. Small businesses usually do not have that infrastructure.

When Does an Employee’s Objection Raise a Legal Concern?

There is another problem with PIPs. The common perception is that a PIP is how an employer starts building a case to fire someone. That can immediately make the process feel adversarial. And if litigation does follow, a detailed PIP gives an attorney plenty to examine: Were the goals reasonable? Did the employee receive enough support? Was the manager following the plan? Did the employer do everything it promised to do?

If the employee is alleging discrimination, retaliation, harassment, a disability or medical issue, protected leave, or another legally protected issue, that changes the analysis and needs to be taken seriously.

If the employee refuses to sign any document, document the refusal and move forward. Their signature generally confirms receipt. It does not mean they agree with it. Failure to sign is a different matter and does not prevent them from having to work on correcting. 

How to Address Performance Problems Before They Escalate

The Human Side: This is why, for a small business, we prefer a culture of ongoing coaching over formal PIPs.

Employees generally respond better when they are asked to make clear, reasonable changes incrementally and immediately, rather than being handed a formal 60-day plan that feels like the beginning of the end.

If the problem is attendance, for example, the direction can be very simple: “You need to be here on time, and I need that change to start tomorrow.” Now the employee knows exactly what is expected and when. You have also eliminated much of the debate about whether you provided enough training, resources, meetings, checkpoints, or support under some complicated improvement plan.

That is the idea behind Progressive Corrective Coaching. Address problems when they occur, clearly explain the change you need, coach the employee toward immediate improvement, and document the conversation. Then evaluate what the employee actually does next.

Frequently Asked Questions (FAQs) 

Should employers use 30-, 60-, or 90-day PIPs?

We recommend Progressive Corrective Coaching instead. Address problems as they occur, establish expectations, provide coaching, document the process, and escalate when improvement doesn’t happen.

What if an employee refuses to sign corrective documentation?

Don’t let the signature become the fight. Document that the employee received the corrective action and refused to acknowledge it, and follow your normal process.

What if an employee threatens to sue after receiving corrective action?

Pause before escalating further and get HR guidance. Determine whether they’re merely objecting to the discipline or alleging discrimination, retaliation, protected leave, or another legal issue that could affect your next steps.

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What should I do when an employee has a bad reaction to a PIP?