Poor Performance vs. Misconduct: Why the Difference Matters

One of the most misunderstood unemployment concepts.

Few concepts in unemployment create more confusion than the difference between poor performance and misconduct.

From an employer's perspective, this can become a frustrating sticking point. An employee consistently fails to meet expectations, productivity suffers, mistakes continue despite coaching, and eventually the employer decides enough is enough. The employee is discharged, so it seems reasonable to assume they shouldn’t qualify for unemployment benefits.

In many cases, however, benefits are allowed.

That’s because the issue isn’t whether the employer had a good reason to terminate the employee. The question is whether the employee's conduct meets the legal definition of misconduct under the applicable unemployment law.

Understanding that distinction can help employers focus on the facts that matter instead of assuming every termination for poor performance will automatically result in a denial of benefits.

Poor Performance Isn't Always Misconduct

In Oregon, it isn’t—except when it is. 

As an employer, you may have every legitimate business reason to end the employment relationship, but that alone doesn’t necessarily mean misconduct for unemployment purposes.

Employees may struggle for many reasons that have nothing to do with misconduct. They may lack the experience needed for the position, have difficulty learning new procedures, work more slowly than expected, or simply not be a good fit for the job.

Misconduct involves more than simply failing to perform the job well. It usually requires some degree of willful or deliberate disregard for the employer's interests. Depending on the circumstances and applicable state law, that might include knowingly violating a reasonable work rule, refusing a reasonable work assignment, intentionally disregarding instructions, or engaging in conduct the employee knew—or should have known—could place their job in jeopardy.

The important point is that not every discharge is a misconduct discharge, even though every discharge may be justified from the employer's perspective.

When Does Poor Performance Become Misconduct?

The line between poor performance and misconduct isn’t always obvious. The same performance issue may be viewed differently depending on the surrounding facts.

Consider two employees who repeatedly make the same mistake after receiving additional training.

One employee makes a genuine effort to improve but continues to struggle despite coaching and supervision. The other employee understands what is expected, has demonstrated the ability to perform the work correctly, but simply chooses not to follow the required procedures.

Although both employees may be discharged for poor performance, the facts surrounding their conduct aren’t necessarily the same. The question becomes whether the employee was unable to meet expectations or was knowingly disregarding them.

Facts Don’t Wear Disguises

“Calling a dog’s tail a leg doesn’t make it a leg.” Changing the name of something doesn’t change the fact of what it really is. The same principle applies to unemployment claims. Calling a reason for separation "poor performance" doesn't make it poor performance for unemployment purposes, nor does calling it "misconduct" make it misconduct.

Adjudicators look beyond the label and evaluate the facts surrounding the separation. What happened? What expectations existed? What did the employee know? What opportunities were provided to correct the problem? What ultimately led to the discharge?

Looking Beyond the Label

Looking beyond the label requires more than recognizing the difference between poor performance and misconduct. It requires understanding which facts support that distinction and how those facts may be evaluated during the adjudication process.

Many employers are surprised to learn that details they considered unimportant can become significant, while information they believed was decisive may carry less weight than expected.

Looking beyond the label is the first step. Determining which facts matter is often where the real work begins.

Every unemployment claim comes with its own facts, challenges, and circumstances. If this article made you realize there's more to an unemployment claim than you first thought, imagine what you could learn by seeing your claim through the eyes of a former unemployment adjudicator.