Here’s how to deal with capability in the workplace

As an employer, you’ll be well aware that employees have good days and bad days. For the most part, staff will meet expectations and get their work done on time and to the best of their ability. Other times, however, an employee could experience a decreased work performance.

In turn, this could lead to a ‘capability’ situation, an issue of poor employee performance which also applies to ill-health or injury.

So, what performance management techniques can you employ to improve an employee’s performance? And how can you help those affect by ill-health or injury? Let’s find out…

Capability in the workplace

Capability in the workplace applies to issues regarding an employee’s skill, aptitude, health, or any other physical/mental quality. Employment law in Ireland recognises that employers may need to conduct a dismissal on grounds of capability.

If an employee can’t perform the job you hired them to do, you can dismiss them. Even if they can still perform some of their duties, you can dismiss them on grounds of capability based on their performance.

A capability dismissal is fair if an employee doesn’t have the capability, competence, or qualifications to do the work you’ve employed to do.

The benefit of a capability policy

A capability policy should specify how capability issues in the workplace will be addressed. It should outline the obligations of both the employer and employees.

Before turning to your policy, you should assess the situation fully and see where you can support employees to work better. Address what issues you can before taking disciplinary action, which should be the last resort.

Another important aspect of your capability policy is that it should work in conjunction with related policies, such as induction, training and development, and disciplinary policies.

Two main types of capability dismissal

There’s no one, all-encompassing procedure for dealing with capability. After all, you might be dealing with a health issue or a performance issue. That means you must treat each employee in order to avoid an unfair procedure.

Here’s how to approach the two main types of capability dismissal.

Capability due to performance

When a performance issue comes to your attention, set out measurable targets to help the employee improve. When you do this, also make the employee aware of the consequences if no improvement is made within an agreed timescale.

A performance management system will help you monitor and review the employee’s performance. It could be the case that the employee needs extra support or training to reach the expected standards of work.

When dismissing an employee on competency grounds for persistent poor performance, determine whether the dismissal related to employee competency is fair:

  • Do you believe that the employee is incompetent to carry out the job?
  • If so, do you have reasonable grounds to sustain that belief?

The procedure you will follow is similar to that used in misconduct dismissals. The procedure must comply with the rules of natural justice and your disciplinary procedure.

Capability due to ill health

Having an employee absent for an extended period or on a regular basis for health reasons can be frustrating for all.

An absence due to ill health can give you reason to carry out a medical capacity dismissal. As with dismissal due to performance, you must follow a fair procedure to avoid conducting an unfair dismissal.

When carrying out a medical capacity dismissal, obtain medical evidence that confirms that the employee’s return to work or recovery is unlikely. If conflict between the medical evidence presented by both parties in relation to the most likely date of return to work, get an independent opinion before confirming the dismissal.

A dismissal on medical capability must follow the principles of natural justice. You should:

  • Ensure you’re in full possession of all material facts regarding the employee’s condition.
  • Ensure the employee receives fair notice that you’re considering a medical capability dismissal.
  • Provide the employee with an opportunity to defend and prove their case.
  • If the employee is incapable after a medical expert deems them so, ensure you explore reasonable accommodations that could help the employee, e.g., changing the employee’s hours of work.

Capability and unfair dismissal

The majority of unfair dismissal claims tend to stem from dismissal due to misconduct. The following questions are those used by the Workplace Relations Commission (WRC) when examining an unfair dismissal claim:

  • Did the employer believe that the employee was guilty of misconduct as alleged?
  • If so, did the employer have reasonable grounds to sustain that belief?
  • Did the employer carry out as much investigation into the matter as was reasonable before dismissing the employee?
  • If so, was the penalty of dismissal proportionate to the alleged misconduct?

The dismissal will be deemed fair if an employer can satisfy the above questions. This is why it’s important to have reliable disciplinary policies and procedures in place.

Our HR consultants can answer your capability questions

If you need help with your capacity policy or want advice on how to avoid an unfair dismissal in Ireland, speak to one of our expert HR consultants now on 01 886 0350.

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Nora Cashe


Nóra studied Law in Griffith College Dublin and qualified as a Barrister in 2008, practising in the area of Criminal law. She is also member of the Irish Employment Law Association.

Nora has extensive experience representing clients at Employment Tribunal hearings, Conciliation / Mediation meetings before both the Workplace Relations Commission and the Labour Court. 

Nóra is a member of the Irish Employment Law Association and engages with the WRC Adjudication Service as part of their stakeholder engagement forum.

Deiric McCann

Genos International Europe

Deiric McCann leads Genos International Europe – The EU division of a world-leading provider of emotional intelligence solutions. 

With over two decades experience at the highest levels of management, Deiric supports clients to develop the resilience, emotional intelligence, psychological safety and engagements of their employees.

Rhiannon Coyne

Graphite HRM

Rhiannon Coyne is a Senior HR Consultant at Graphite HRM and will be providing an overview of best practice on how to deal with complaints of bullying and harassment in the workplace. 

With a number of recent updates to employment laws, Rhiannon will take a closer look at employment equality and how it is interlinked to Health & Safety and what employers can learn from recent case laws.

David Begg

Workplace Relations Commission

David Begg was appointed Chairperson of the Workplace Relations Commission (WRC) in January 2021.

David is also a professor at Maynooth University Institute of Social Sciences. Mr Begg’s extensive history in the trade union movement included leading the ESB Officers Association and Irish Congress of Trade Unions, stepping away from the latter in 2001 to chair international aid agency Concern.

David Begg was also previously a director of the Central Bank of Ireland between 1995 and 2010.