When Performance Management Backfires and How to Fix It 

Mike Hagan | WHS Show

Mike Hagan doesn’t mince words. 

Performance management, he told a packed room at the WHS Show in Melbourne, is one of the most mishandled, misunderstood, and misused processes in the modern workplace. And when it goes wrong, the fallout isn’t just HR’s problem — it’s a health and safety risk. 

Hagan’s seen the damage up close. As a senior executive across HR and HSE, he shared one all-too-familiar story: 

A frustrated manager. Two years of informal gripes and zero documentation. A team member suddenly off on stress leave, citing bullying and psychological harm. And no paper trail to protect the business. 

“I went from the Maldives to Mordor in three hours,” Hagan recalled. “The damage was done to the employee, the manager, the team, and the culture.” 

Let’s be clear: this wasn’t just a communication breakdown. It was a psychosocial hazard in action. 

Poor performance management isn’t just bad HR, it’s a safety issue 

For many, performance conversations are the workplace equivalent of walking through a minefield.
Emotionally charged, often high stakes, and sometimes traumatic — these conversations can create real harm when done poorly. 

“We talk about performance like it’s a box-ticking exercise,” said Hagan. “But where’s the mention of trauma? Of care? Where’s the psychological safety?” 

The data backs him up. 

Fair Work Australia has seen a 25% spike in complaints related to performance management. Meanwhile, 61% of employees say the process is fundamentally unfair. 

Mismanaged conversations can erode trust, breed disengagement, and trigger burnout. In the worst cases, they become the very hazards health and safety professionals are trying to prevent. 

 The uncomfortable truth? Most of us are doing it badly 

During a live poll at the event, almost no one said their workplace handled performance management well “most of the time.” 

And Hagan’s own LinkedIn research painted a similar picture: 

• 67% of managers agree performance management is important 
• But very few believe their organization does it effectively 

So what’s going wrong? 

“Too many of our processes are stuck in the 1940s,” Hagan said. “Annual reviews. Stretch targets. Paper trails for the sake of bonuses. We’re still managing people like it’s 1950 — not 2025.” 

A better way forward with compassion and competence 

So how do we fix it? 

Hagan laid out a framework for what he calls ethical performance management — a model that recognises performance conversations as both an HR and a health and safety responsibility. 

It starts with three key pillars: 

1. Policy

• Retire the term “performance management.” Try “growth conversations” or “ongoing development.” 
• Align your policies across performance, wellbeing, and conduct. They should sound like they came from the same organisation. 
• Make your policies trauma-aware. Spell out what employees can expect, what support is available, and how the process will feel. 

2. People

• Train leaders to start conversations early — before things escalate. 
• Build comfort with discomfort. “If they can handle a mildly awkward conversation, they might avoid a catastrophic one,” Hagan said. 
• Don’t forget leaders need psychological safety too. Many are scared of conflict, of complaints, of losing high performers in a hiring freeze. 

3. Process

• Ditch the once-a-year review. Shift to regular, structured check-ins. 
• Every fortnight, combine positive feedback with opportunities to grow. 
• Make development plans the norm — not just for people who are struggling. 

Before you assume, ask 

Performance flags don’t always mean poor performance. Sometimes, they’re a cry for help. 

Heads down. Missed targets. A sudden drop in energy. 

What looks like disengagement might actually be burnout. Depression. Grief. Or simply someone navigating a neurodivergent experience without support. 

“We need to ask before we assume,” said Hagan. 

He pointed to the 17 psychosocial hazards outlined by Comcare — and how nearly all of them can be triggered, or made worse, by a poorly handled performance conversation. 

Start sooner. Lead with care. 

“Start the conversation when you think something might not be right — not when you know it’s wrong.” 

That doesn’t mean letting performance slide. It means tackling it early, clearly, and compassionately. 

Because when performance conversations are done well, they don’t feel like punishment. They feel like possibility. 

“Performance management should be a conversation,” Hagan said. “One that sets people up to succeed.”

About Mike Hagan

Mike Hagan is a seasoned HR and HSE executive focused on transforming performance management into a tool for wellbeing and safety. Drawing on decades of experience, Mike advocates for trauma-aware, compassionate growth conversations that protect employees and organisations alike. Connect with Mike on LinkedIn or learn more about his work at mikehaganconsulting.com.au.