HR & performance glossary
What is a performance improvement plan?
Performance improvement plan (PIP): A formal, time-bound plan that sets out where an employee is falling short, what good performance looks like, the support on offer and when progress will be reviewed.
Definition
A performance improvement plan, or PIP, is a formal, time-bound document that sets out where an employee's performance is falling short, what good performance looks like, the support they will receive and the date by which progress will be reviewed. It is typically used after informal feedback has not resolved a problem, and it often sits alongside an organisation's capability or disciplinary procedure.
A PIP is different from an individual development plan. An IDP builds capability for growth and is something most employees have; a PIP responds to a specific shortfall in current performance and is used sparingly, when the gap is significant and informal support has not closed it.
How it works in practice
A fair PIP is specific. It names the gap with examples rather than impressions, sets a small number of measurable objectives, commits to concrete support such as training, coaching or more frequent check-ins, and schedules review points before the end date. The employee should be able to see exactly what would count as success. Where employment law or a works council sets requirements for the process, those take precedence, and HR should be involved from the start.
The plan runs for a set period — thirty, sixty and ninety days are all common, depending on how often the relevant work happens — with check-ins at fixed points. Each check-in is recorded: what progress has been made, what support has been given and whether anything needs to change. At the end, the outcome is usually one of three: objectives met and the plan closed, a documented extension, or the next step in the organisation’s procedure.
A worked example
An illustrative example: the team described is hypothetical, not a customer.
Consider a hypothetical customer service team member whose case-handling quality has fallen over several months. Their manager has raised it in 1-on-1s, with examples recorded in the performance journal, but quality has not recovered. The manager and HR agree that a formal plan is now proportionate.
The PIP names the gap: over the last quarter, too many of their cases were reopened because the original fix was incomplete, with examples attached. It sets two objectives for the next sixty days: follow the documented resolution checklist on every case, and bring the reopen rate within the team’s standard range. Support includes a weekly case review with a senior colleague and a refresher on the checklist. Check-ins are scheduled every two weeks, with a final review at the end of the sixty days.
At the final review, the reopen rate is within range and the checklist is being used consistently, so the plan is closed and the outcome recorded. The weekly case review continues informally for another month.
Common mistakes
Using a PIP as the first step. If the plan is the first time a concern appears in writing, the process looks like a formality. Informal feedback, recorded as it happens, should come first.
Vague objectives. ‘Improve attitude’ cannot be measured or met; objectives should describe observable results or behaviours, so both sides can see whether they have been achieved.
Promising support that never arrives. If the plan commits to training or coaching, it has to happen, and the record should show that it did.
Setting it up to fail. A PIP designed as a route to dismissal rather than a genuine chance to improve is unfair to the employee and exposes the organisation. Success should be achievable, and a plan that succeeds should be closed cleanly.
Ignoring local rules. Employment law, collective agreements and works councils may set requirements for how the process runs; check them before the plan is issued, not after.
How CLEAR Talent supports it
A PIP is only as credible as the record behind it. Continuous performance management builds that record as work happens: in CLEAR Talent, managers log observations in a performance journal and capture coaching from 1-on-1s as development notes, both tagged to competencies. Changes to goals and ratings are written to the audit trail kept by the performance review software, so the history is visible if a decision is questioned later. CLEAR Talent does not have a dedicated PIP workflow; the formal plan itself belongs in your HR record-keeping process.