Sometimes businesses hire people whose performance doesn’t live up to the initial expectations. Sometimes the problem isn’t so much about performance as it is behavior. Either way, you already know you can hurt your business if you hire the wrong employee, but you will hurt it even more if you don’t put a comprehensive, consistent procedure in place to use when employees present problems. You might even be able to redirect problem employees so they can be assets instead of liabilities.

One of the best procedures is something called progressive discipline. It starts with training. You can only expect employees to live up to your expectations when you have given them a clear understanding of what you require of them as employees. The usual way to do this is through job descriptions and employee handbooks.

Once employees understand your expectations, the progressive discipline generally consists of the following steps:

• An oral warning: The oral warning is more complicated than it might seem. For example, a manager can only reasonably give an employee an oral warning after the employee has been trained and then counseled about the specific problem. If you haven’t trained the employee adequately, you don’t have grounds for complaining about noncompliance. The first goal is to find out whether an employee understands what you want to see in terms of behavior and performance. If the first conversation is not enough to correct the problem, though, then the supervisor needs to have a second conversation. Document any conversations you have about the problem in one memo or more, and place the documentation in the employee’s file.

• The written warning: If the problem still exists after the oral warning, then it is time for a written warning. A written warning consists of two parts: a written discussion about why the employee’s behavior or performance is a problem, and a list of one or more potential consequences if the problem is not corrected within a certain amount of time. Depending on how valuable the employee is, a manager might choose to provide multiple written warnings. For example, perhaps it has been a while since the last warning, you think you were not clear enough, or you are pretty certain the employee misunderstood you.

• Suspension or demotion: Sometimes you don’t have to apply the worst possible penalty that is available to you. Perhaps suspending an employee temporarily, or moving the employee into a lower-level job, would be enough. If you do decide to suspend someone, it’s a good idea to have a standard way of proceeding with that as well. For example, you might want to start with a one-day suspension and work up to a five-day suspension, if necessary, over time.

• Termination of employment: If the time specified in the written warning has gone by and the employee’s behavior or performance are still a problem, or the employee just refuses to cooperate, then the best solution might be letting the employee go.

The key to being effective about progressive discipline is documentation. You need to keep detailed documents so it is clear that you have followed your own procedures and given the employee every chance to correct performance and behavior. Also, you should keep an eye on the amount of time that passes. Maybe someone has earned the right to move backward in the process as well as forward. On the other hand, you don’t want problem behavior to continue indefinitely. Letting a problem drag on too long makes you look ineffective — not the message you want to send your employees.

You might feel uncomfortable about the idea of disciplining employees, but the reality is that discipline has a vital role in the workplace:

• Everyone benefits when they know managers are going to follow a specific disciplinary procedure that is fair and is consistently applied to all employees.

• Discipline can correct performance and behavior so employees can comply with the standards and expectations you’ve set. Obviously, the best outcome is not firing someone. Doing that is expensive; it will cost you in lost productivity and higher SUTA payroll taxes. Not only that, firing someone can cause bad feeling, especially when the process is done poorly. Instead, the goal is helping all employees succeed in your specific business environment.

• Give employees a chance for self-defense. Sometimes you will find that an employee has a good case to make. You might be able to correct problems you didn’t even recognize you had.

• Discipline encourages all employees, not just the problem ones, to live up to the expectations set by the company for their behavior and ethics. Having a standard doesn’t just tell you when employee behavior is a failure; it also tells you when employee behavior is a success. Use that fact to your advantage.

• Discipline shows a good-faith effort on the part of your business to follow an impartial process when dealing with any employee problem so that if it does become necessary to terminate someone’s employment, it will be clear to everyone that the company was fair and gave the employee every chance to correct whatever problems existed.

You may be surprised to realize that your employees appreciate having a well-documented, fair process for working through employee problems in a timely way. Even though nobody wants to see another employee lose a job for what seems like arbitrary and unfair reasons, people also don’t want to see another employee getting away with obvious bad behavior. Making the effort to try and correct behavior, and firing someone only when necessary, will reassure your remaining employees that you aren’t weak or a fool. These are good points for them to understand about you.

To make your progressive discipline program succeed, you will need to do the following:

• Write a formal policy. It should be included in employee handbooks and in any documentation about how your company works that you will be giving to employees.

• Train your managers so they know how to implement the progressive discipline program.

• Spend the time and energy to make sure you document and follow up with problems. You might want to consider having someone be present as a witness or to take notes during any disciplinary procedure. Just don’t choose someone who is a peer of the employee being disciplined. You could also allow the employee to select someone to act as witness. The idea is to balance not embarrassing an employee with making sure that the process is open, fair and impartial.

• Recognize that a progressive discipline program can alter or suspend the rules of at-will employment until it becomes clear your best alternative is actually firing an employee. Being scrupulous about how you implement the plan, and demonstrating patience throughout the process, works to benefit you in the long term. That way, no one can accuse you of being arbitrary or not giving an employee enough of a chance.

The goal is to use the weakest effective action so that you don’t escalate any situation unnecessarily. That doesn’t mean going through the steps has to be rigid, though. There might be cases where it is appropriate to skip some of the steps. Suppose you find out an employee is stealing, fighting, or using or selling drugs or alcohol. In a case like that, you may have to just fire the employee immediately. However, even that can be explained ahead of time in your formal policy. People will understand. .

Sexual harassment violates Title VII, the Civil Rights Act of 1964 because it is a form of discrimination based on gender. Not only that, but each state also has its own sexual harassment laws. The actions that constitute sexual harassment are fairly broad. Making unwelcome sexual advances, requesting sexual favors, and verbal or physical behavior that is sexual are certainly a part of it. If permitting or rejecting these actions can affect whether someone is able to keep or do a job, or if the work environment could be considered intimidating, hostile, or offensive by a reasonable person, then by definition, an employee could claim sexual harassment.

The reason the government takes sexual harassment seriously is plain: you would not be allowed to run a business where it was extremely likely your employees could be hurt or killed, and this is not much different. Sexual harassment is not harmless; it hurts people, and it is bad business. You have a legal obligation to provide a workplace that is free of harassment. Failing to do so will cost you a great deal in terms of employee morale, lost productivity, and — if these are not enough of a consequence by themselves — money and time spent paying lawyers and going to court.

You may know all of that already. You may not be aware, however, of just how broad the law is when it comes to harassment:

• Some people think that sexual harassment only occurs if a male supervisor harasses a female subordinate. But both the victim and the harasser can be of either gender, and they can also be the same gender. Generally this is interpreted to mean heterosexual harassment, such as a married man being harassed with inappropriate pictures and jokes. The U.S. Supreme Court has not addressed whether it is illegal to harass gays and lesbians, and the lower courts have handled the matter in a variety of different ways. The safe thing to assume is to consider harassment of gays and lesbians just as illegal as harassing someone who is heterosexual. This is an area of law that has not yet been worked out, which means it is also not something you want to have decided in a courtroom.

• Although the harasser might be the victim’s supervisor, it’s also possible for the harasser to be a co-worker, a supervisor from a different area, someone who doesn’t work at the company, or someone who is working on behalf of the employer. The harasser might even be a vendor or a customer.

• Anyone who is affected by offensive conduct — not just the person who is being actively harassed — can be considered a victim.

• The victim doesn’t have to suffer monetary damages or lose a job.

There is one other important requirement in order for something to be considered sexual harassment: the harassment has to be unwelcome. If an employee thinks that it might be necessary to prove the harassment is unwelcome, then the first step is making that plain. This requires action on the part of the victim. For example:

• It’s a good idea for the victim to tell the perpetrator directly that whatever is going on is unwelcome and has to stop.

• If there is some sort of process set up for complaining or resolving grievances, the victim should take advantage of that, too.

• It would be wise for the victim to document both the harassment and any efforts to stop it in a private journal. Then the victim can have a better hope of being able to prove the harassment was unwelcome, other than just claiming it later on.

The agency that investigates claims of sexual harassment is the Equal Employment Opportunity Commission (EEOC). When a claim is brought to the attention of the EEOC, the people who look into it are going to look at a company’s entire record. They will want to know what kind of sexual advances were made, and what the context was. They examine any allegations that are made on an individual basis, one case at a time.

The best thing a company can do when it comes to sexual harassment is to prevent it from happening in the first place. That starts with the following steps:

• Write a policy where it is made clear that the company does not tolerate any form of sexual harassment. A good place to put this policy would be in the employee handbook.

• Teach both employees and supervisors what the policy is, and then tell them what to do if a situation involving sexual harassment comes up. Have training sessions at least once a year. You can’t just train people once and expect it to last forever. People change jobs, and even if they’ve heard what you have to say before, it doesn’t hurt to say it again. Conduct separate sessions for managers than for employees; that way, you can focus on what is relevant to each group.

• If something does happen and someone does make a complaint, don’t ignore it. Take action as promptly as possible. There can be no exceptions; managers and supervisors have to be held to the same standards of conduct as anyone else. When you are writing your policy about sexual harassment for the employee handbook, make sure the section includes the following:

• Define what sexual harassment is.

• Make it plain that sexual harassment will not be tolerated.

• State the consequences if it does occur, such as disciplining or firing anyone who is involved.

• Clearly outline what the process is for making a complaint or resolving a grievance.

• Tell your employees that if someone does make a complaint, it will be investigated and resolved.

• Finally, tell your employees that you will not tolerate retaliation against anyone who complains.

Once you’ve trained everyone and you have a plan of action on paper for people to refer to, you are not done. You also need to be aware of what is going on in your company. Walk around. Talk to people. Pay attention, and don’t expect that everything is fine. If you see something that concerns you, talk to your supervisors about it.

Employees do tend to take their cues from management. Making it clear that sexual harassment is unacceptable, and backing it up with policy, might be enough to prevent any kind of sexual harassment from happening in the first place. But if it does happen, you and your company will be prepared, and, hopefully, you will have created an environment where people can trust that they can appeal to your company for help and that your company will put an absolute stop to the problem.

Sexual harassment is one of those things that tends to increase in severity over time. The more you ignore and tolerate it, the more likely it is to pervade the company. You don’t want that.

It is, of course, still possible that sexual harassment could take place within your company even when you put a policy in place to prevent it. But the more clearly you communicate that sexual harassment is not to be tolerated, and the more you back that policy with solid, demonstrable action, the less likely it is you will deal with a serious problem. More than that, you will also have reduced or eliminated your liability.