What Happens at a Performance Review or Capability Meeting

Poor performance is one of the hardest things for a manager to raise. It is personal, it is often unclear where the problem lies, and the fear of getting the process wrong leads many managers to delay until the situation has become entrenched. By that point, the conversation is much more difficult for everyone.

This post explains what a performance or capability meeting involves, how the process usually progresses, and what a fair and effective approach looks like. It is written primarily for employers and managers, but it is also relevant for employees who have been invited to a meeting about their performance.

Capability and conduct are different things

The first distinction to make is between capability and conduct. Capability is about whether an employee can do the job to the required standard, because of a lack of skill, knowledge, training or experience. Conduct is about whether they will follow the rules or behave appropriately. The two lead to different processes. Someone who cannot do the job needs support, training and time to improve. Someone who will not follow reasonable instructions is dealt with under the disciplinary procedure.

Mixing the two is a common source of unfairness. An employer that treats a capability problem as misconduct, or the reverse, risks losing the case even if the underlying concern was genuine. Managers should also consider whether the problem is connected to something else, such as a health condition, a disability, a personal difficulty or a lack of clarity about expectations, before settling on a route.

Start informally

Most performance concerns should begin with an informal conversation. The manager sets out what the concern is, gives specific examples, explains the standard required and asks what is getting in the way. Often the answer is a lack of training, unclear priorities or a problem elsewhere in the team, and it can be resolved without any formal step. The draft revised Acas Code of Practice on disciplinary and grievance procedures, consulted on until 23 September 2026 and expected to take effect in 2027, puts greater weight on informal resolution as a first step. Formal action should follow only if the informal route has not worked or the problem is serious.

The informal conversation should be recorded, with a short note of what was discussed, what was agreed and when it will be reviewed. That note is important later, because it shows the employee was told about the concern and given a fair chance to improve.

Before a formal meeting: preparation and process

If informal discussions have not worked, the employer can move to a formal performance meeting. Before doing so, the manager should be able to answer four questions: what is the standard required, how does the employee's performance fall short of it, what support has already been given, and has the employee been told?

The employee should receive a written invitation setting out the concerns, the date, time and place of the meeting, and the potential outcomes. Copies of any evidence, such as performance data, examples of work or feedback, should be attached. Where the meeting could lead to a formal warning or other formal action, the employee has the statutory right to be accompanied by a trade union representative or a work colleague.

Reasonable adjustments should be considered from the start. An employee with a disability, or a neurodivergent condition, may perform very differently with the right support, and an employer that has not considered this may be exposed to a discrimination claim.

At the meeting: what actually happens

The manager opens by explaining the purpose of the meeting and how it will run. The concerns are then set out clearly and with examples. General statements such as poor attitude or lack of drive are not enough. Precise ones, such as three reports submitted late in the last two months or error rates above the agreed target, allow the employee to respond properly.

The employee is given a full opportunity to respond. They may explain the difficulties, challenge the evidence or raise something the manager did not know, such as a health issue, a lack of training or a workload problem. The manager should listen properly and be willing to adjust the approach accordingly.

The discussion then turns to what needs to change and what help is available. That may mean training, coaching, a mentor, clearer objectives, reduced workload or a change in working arrangements. If a formal outcome is appropriate, a performance improvement plan is often the next step.

Performance improvement plans

A performance improvement plan, often called a PIP, sets out in writing what needs to improve, the standards to be met, the support the employer will provide, how progress will be measured and the review dates. It should have realistic targets and a reasonable timescale, usually several weeks to a few months depending on the role. Regular review meetings should be held during the plan, with the employee given honest feedback on progress.

A PIP is not a formality on the way to dismissal. It should be a genuine attempt to help the employee reach the required standard. An employer that sets impossible targets or fails to provide the promised support will struggle to show the process was fair.

After the plan: the possible outcomes

At the end of the review period, the manager should hold a final meeting to discuss the outcome. If performance has improved to the required level, the plan is closed and the employee told. If there has been some improvement but not enough, the period may be extended. If there has been no improvement despite proper support, the employer may consider a formal warning or, ultimately, dismissal on grounds of capability.

The outcome should be confirmed in writing, with the reasons, the sanction or next steps, and the right of appeal. Dismissal for poor performance is a potentially fair reason, but the tribunal will ask whether the employer genuinely believed the employee was not capable, had reasonable grounds for that belief, gave them a proper opportunity to improve and followed a fair procedure.

What is changing

From 1 January 2027 the qualifying period for ordinary unfair dismissal claims falls from two years to six months, and the cap on compensation is removed. There is no lighter-touch process proposed for shorter-serving employees, so performance issues in the first two years of employment will need to be handled with the same care as for longer-serving staff. Automatic unfair dismissal and discrimination claims already apply from day one.

The final word

Fair performance management is not complicated, but it does demand honesty, evidence and time. Setting clear standards, raising concerns early, giving real support and recording each step makes most capability cases resolvable. It also means that where dismissal does become necessary, the employer can show that it was reasonable.