Performance Management Policy
A Performance Management Policy is an important HR document used to outline your business expectations of employees performance.
4.3 (14 reviews)
Last updated October 24, 2025
Under 5 minutes
Written by Edwin Montoya Zorrilla
Reviewed by Damin Murdock
Document Overview
A Performance Management Policy sets out the policies and procedures that your business follows in relation to employee performance management. This document provides you with a simple way to clarify how your business manages performance reviews, unsatisfactory performance and employee progression.
The Legal Risk Score of a Performance Management Policy Template
Suitable for Australia
Our legal team have marked this document as low risk considering:
- There is a risk that the document’s reliance on supervisors and managers to fairly interpret and apply performance standards could lead to inconsistencies in handling unsatisfactory performance across different departments or teams.
- The document outlines a structured process for managing performance that requires meticulous documentation and follow-up, which could be burdensome for smaller organizations or those without a dedicated human resources department.
- The policy's emphasis on procedural fairness and natural justice, while protective of employee rights, may prolong the resolution process, potentially impacting organizational efficiency if not managed effectively.
Performance Management Policy Checklist
Complete your free Performance Management Policy with our checklist
Review and Update Regularly
Ensure that the performance management policy is reviewed and updated regularly to remain compliant with current legislation and best practices.
Train Supervisors and Managers
Conduct training sessions for supervisors and managers to familiarize them with the procedures and expectations outlined in the policy to ensure consistency and fairness in its application.
Monitor and Document Performance
Supervisors should consistently monitor and document employee performance according to the policy to maintain accurate records and support any decisions made regarding employee performance management.
Seek Feedback and Improve
Gather feedback from employees and managers about the performance management process and use this information to refine and improve the policy over time.
Use this Performance Management Policy if:
- Your business would like to inform employees about important performance management procedures.
What does the Performance Management Policy cover?
- Managing for performance;
- Managing unsatisfactory performance; and
- Disciplinary action.
Other names for Performance Management Policy include:
- Review of Performance Policy; and
- Performance Review Policy.
Other documents you may need:
View Sample Performance Management Policy
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