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Performance Reviews

Most Australian employers have some form of performance review for worker appraisal and feedback. In fact, it is generally recommended for employers to conduct regular performance reviews with employees. These occasions are an opportunity to discuss problems and identify future opportunities for development and progression. These reviews also provide a forum for employees to be given warnings and are necessary for any disciplinary action over poor job performance. An employee must participate in a performance review process if they are asked to do so by their employer. However, there are some legal protections for workers when it comes to the conduct and use of performance reviews. This article explains the legal implications of performance reviews in Australia.

Mandatory performance reviews

Traditionally, employers conduct performance reviews with every member of their workforce at least once a year. Employers who hold formal performance reviews will typically have standardised policies and procedures around how these interviews are conducted. These policies usually outline possible outcomes of performance reviews and the processes that might eventuate.

Recently, many companies have moved to a more responsive feedback performance management systems. In these responsive systems, managers will conduct reviews quarterly, monthly, or even weekly. Alternatively, some employers choose not to conduct formal performance reviews at all. In this case, managers may only conduct regular and informal “check-ins” with their direct subordinates.

An employee is contractually obligated to comply with their employer’s preferred system of performance review, provided the employer’s request is lawful and reasonable. If an employee refuses to participate in a reasonable performance review, this can itself be grounds for disciplinary action.

Australian courts have upheld the rights of employers to conduct performance reviews. For instance, the Federal Court of Appeal upheld an earlier verdict in Perez v Northern Territory Department of Correctional Services [2016] that a performance review meeting was an “ordinary incident” of employment. In this case, the Northern Territory Department of Correctional Services initiated a performance review with a corrections officer named Luis Perez. Perez complained that the performance review was an adverse action against him by his employer. Judge White found that the employer was entirely justified in calling the performance review meeting and that there had been no injury to Mr Perez’s employment because no decision was made to alter his employment. In fact, there had been no tarnishing of his employment record. Judge White found that regardless of how the employee perceived the performance review, it cannot reasonably be regarded as an adverse action. The court found that it is expected in the correctional services industry for an employee’s progress to be reviewed periodically, to identify deficiencies and encourage corrective action if required.


During a performance review, management is in a position of authority and should set the tone as civil and productive. Managers must remain conscious that their actions can substantially affect the worker’s career and should avoid certain topics and comments to maintain a positive environment. Employers should undertake these reviews fairly, objectively, and transparently, with a clear understanding of employee rights under the Fair Work Act.

For instance, the employer should not level general criticisms at the employee without giving examples. Instead, the employer should point to specific examples of the employee’s performance that they can improve going forward. It is also preferable for the manager to focus on the employee’s individual performance without comparisons to other employees. Employers should also refrain from raising the prospect of future raises or promotions if there is little likelihood that the employee will receive these benefits.

Adverse action

It should be acknowledged that performance reviews can be challenging for both employer and employee. Employers should use caution when conducting performance reviews, as certain conduct can be construed as a form of adverse action. The Fair Work Act 2009 defines adverse action as unlawfully threatening to dismiss the employee, detrimentally alter their position, or discriminate against them.

Some management behaviour during performance reviews may also constitute unlawful bullying under the Fair Work Act. The employer might also breach discrimination law during performance reviews. For instance, in Victoria, the Equal Opportunity Act 2010 (Vic) prohibits unlawful discrimination because of age, race, sex or employment activity. An employee should consult an employment lawyer if they feel they are subject to an unreasonable performance review or to unreasonable performance criteria.

Performance reviews are a useful tool to ensure that an employee’s work aligns with company goals. The process can also be helpful to performance-manage employees. Managers can use them as an opportunity to correct issues before they become grounds for dismissal and to foster development and employee engagement. However, employers need to be careful that their conduct during a performance review does not constitute adverse action, discrimination or bullying.

If you require legal advice or representation in any legal matter, please contact Go To Court Lawyers.


Nicola Bowes

Dr Nicola Bowes holds a Bachelor of Arts with first-class honours from the University of Tasmania, a Bachelor of Laws with first-class honours from the Queensland University of Technology, and a PhD from The University of Queensland. After a decade of working in higher education, Nicola joined Go To Court Lawyers in 2020.

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