Termination due to failure to achieve result

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Both the Labor Code and the Civil Code contain regulations concerning contracts, the purpose of which is to achieve a result, depending on the assumed functions and obligations to be performed.

Contract for specific work and termination due to failure to achieve a result

According to the Civil Code, a specific task contract is an example of a result contract. Thus, the person performing the work undertakes to perform a specific work, achieve the result indicated in the contract or agreed orally by the parties to the contract. There is an obligation to achieve a result. However, the contract will be performed when the result is achieved (e.g. custom-made kitchen furniture). It is assumed that the purpose of the contract should be achieved. Generally, result contracts regulate simple activities. The person executing the order undertakes to perform a specific work. The result of the action indicated in the contract is easy to predict and should be easy to achieve by a person with the appropriate skills.

The Civil Code indicates situations in which the contract for a specific task may be terminated. “According to Art. 631 of the Civil Code, if in the cases provided for in Art. 629-630 of the Civil Code, it was necessary to significantly increase the cost estimate, the contracting authority may withdraw from the contract, but should do so immediately and pay the contracting party the appropriate part of the agreed remuneration. Therefore, it is possible to terminate the contract immediately after receiving information about the increase in costs, but the current remuneration or expenses must be settled. "

Pursuant to Art. 635 of the Civil Code, if the contracting party is delayed with the commencement or completion of the work to such an extent that it is unlikely that it will be able to complete it within the agreed time, the contracting authority may, without setting an additional time limit, withdraw from the contract even before the deadline for the performance of the work. Therefore, in this case, it is possible to terminate the specific work contract even before the work is completed. However, it is advisable to inform the contractor in advance that this may happen if he does not rush to perform the work, in addition, you can indicate a longer period for the performance of the work. Only after this period has expired, it is advisable to terminate the contract for specific work. Unless the deadline for the performance of the work is already impossible to implement at a certain stage and even its extension will not lead to its completion, then talks about extending the deadline with the contractor are not necessary.

Example 1.

The ordering party concluded a specific work contract with the contractor, the subject of which was the performance of a Christmas exhibition in one of the shopping malls. The contract was signed on November 30, 2017, and the deadline for its implementation was December 15, 2017. Until December 17, 2017, the contractor had not prepared any decorations, but only purchased semi-finished products for the exhibition. The Ordering Party terminated the contract for specific work due to exceeding the deadline for the performance of the work.

Also in the event of a defective performance of the work, the ordering party may terminate the contract for specific work. Pursuant to Art. 636 of the Civil Code, if the contracting party performs the work in a defective or inconsistent with the contract, the contracting authority may call him to change the manner of performance and set an appropriate deadline for this purpose. After the expiry of the specified deadline, the ordering party may withdraw from the contract or entrust the correction or further performance of the work to another person at the expense and risk of the party accepting the order. If the ordering party has provided the material himself, he may, in the event of withdrawal from the contract or entrusting the performance of the work to another person, request the material to be returned and the work started.

Pursuant to Art. 644 of the Civil Code, until the work has been completed, the contracting authority may withdraw from the contract at any time by paying the agreed remuneration. However, in such a case, the ordering party may deduct what the order taker has saved due to the non-performance of the work.

Thus, a contract for a specific work is about the performance of a work, a result, while activities aimed at achieving this result are, in principle, not essential for the ordering party.

An employment contract is not a result contract

As for the employment contract, termination due to failure to achieve a result, it should be indicated that this is a moot point. However, it is quite often examined by the courts, in particular with regard to managerial positions, e.g. in banks. In accordance with the judgment of 20 January 2014, file number II PK 116/13, the Supreme Court emphasized that "The employer has the right to terminate the employment contract of an employee holding an independent position in a situation in which (even for no fault of his own) he does not achieve the proper results of work. An employer who undoubtedly has the right to select employees in a manner that ensures the best performance of tasks, may reasonably predict that employing another employee will allow him to achieve better work results ". In the above case, the Supreme Court examined the facts in which “The claimant worked as a full-time regional manager. The employee received a written scope of duties from the employer, including her responsibility for the implementation of sales plans, knowledge of the company's offer and sale rules. It did not recruit employees, nor did it have the power to punish and reward them, and created a schedule for colleagues. The employer terminated the employment contract due to the lack of implementation of sales plans, pointing to the following reasons: the continued failure to implement sales plans in the branch under management and the exhaustion of the cooperation formula ”. It is worth recalling, however, that in the case of constructing the reason for the termination of an employment contract, such as "failure to achieve a result", in a situation where the dismissed employee is in the group of other employees who have poor performance and no results in a given period, and yet have not received terminations then the plaintiff will not be able to defend himself in court.

It's worth mentioning that "The employment contract is not a contract of the result but of careful action against the employer's justified allegations in terms of careless and negligent behavior of the employee, leading to failure to achieve realistic goals set by the employer, may lead to the termination of the contract for this reason. In addition, the employer's reservations as to the manner in which the employee performs his employee duties, leading to the results of his work that are unsatisfactory for the employer, should be specified and indicated in the letter terminating the employment contract, because within these reasons, an assessment of the legitimacy of the termination of the employment contract by the court should be made.Meanwhile, the allegations as to the improper way of the plaintiff's performance of employee duties, including those relating to the plaintiff's failure to implement the designated plans, were not formulated in the letter terminating the employment contract with him " (see the judgment of the Court of April 10, 2014, file reference number V Pa 36/14).

It is worth pointing out that for "The issue of justification for termination does not matter whether the employee performs his duties negligently, therefore whether he can be blamed for achieving worse than expected results, or whether for reasons beyond his control, he does not organize his work in a way ensuring the achievement of the required results. It is therefore possible to dismiss an employee who tries to achieve the required results, albeit in an inept way " (see the judgment of October 2, 1996, file reference number I PRN 69/96).

Therefore, if the employee does not achieve the designated results regardless of the circumstances that have influenced it, the dismissal will be justified. It is worth noting that this employee must have clearly defined tasks that are possible to perform. His failure to achieve results, poor results of his work compared to other employees are the reasons that entitle the employer to part with him. The employer, in accordance with the principle of objective selection of employees, has the right to seek employees who will perform their tasks well by achieving good results and results expected from them. The employer, by terminating the employment contract with the employee due to the failure to achieve the result, has the right to strive to improve the functioning of the department in which the employee performed work and did not achieve good results.

Example 2.

At the beginning of the year, the manager of one of the bank's branches received a detailed development plan for his branch along with product sales plans. The plan included detailed percentage calculations for achieving the appropriate results for each month and quarter. He had the opportunity to organize training for his subordinates and consultations with senior advisers at the bank. After 3 quarters, an audit was carried out in the bank branch where the manager implemented the plan. It turned out that the branch hardly earned at all, the points indicated in the plan were implemented very poorly and none of the planned results were achieved by him. It is worth adding that in other, similar branches of the bank in this area of ​​Poland, plans were implemented and the expected results were achieved. Managers in these compared departments coped with the tasks very well. Therefore, in the case of the above-mentioned manager, the employer will be able to give him a notice of termination due to failure to achieve the result. However, the reason for the termination should be thoroughly described along with the deadlines and details of the unfinished plan etc.

It should be recalled that in a situation where the employer contributed to the failure of the employee to achieve the result and used it as a reason for the dismissal of the employee, this will not be an effective dismissal. Then the employee will be able to challenge such cause in court.

In conclusion, the contract of the result is primarily a contract for specific work. The purpose of a specific work contract is to perform a specific work. The contractor bears the risk of not achieving the result. The final result of his work, the result must be achievable and real (e.g. making equipment for a dentist's office, creating texts written for a blog on request). Failure to achieve the result, performance of the work, inability to perform the work within the expected time limit are sufficient reasons for the termination of the contract for specific work.

When it comes to a contract of employment and a termination due to a failure to achieve a result, the reason should be real, true and precisely stated. The employee should have specific tasks that are realistic to perform. In the case of poor results and failure to achieve results in a specified time compared to other employees, the above-mentioned reason will be justified.