Disclaimer: This guide is intended for educational purposes only. It does not replace legal advice. If you are unsure whether a situation constitutes a legal or policy breach, seek advice from your HR department or a legal professional.

More than a tick box

Performance reviews in healthcare are not a tick-box exercise - they are a strategic tool for improving care quality, staff wellbeing, and organisational performance.

While performance reviews are a compliance requirement, they are too often seen as an administrative burden. But when done well, they create measurable benefits: strengthening workforce capability, reducing risk, and directly supporting safe, high-quality care.

This practical guide shares some best-practice strategies to support you as a people leader or manager with performance reviews.

Why performance reviews matter in healthcare

No two days are the same in healthcare; there are many moving parts and often competing priorities that require the attention of people leaders and managers, such as balancing the safety of people receiving care, compliance obligations, staff wellbeing, and professional growth. In this environment, a structured review process is one of the few opportunities to pause, reflect, and realign. When reviews are consistent and purposeful, they:

• Recognise and reinforce staff contributions.
• Identify learning and development needs before they impact care.
• Address issues early, reducing escalation into formal performance management.
• Strengthen the link between individual practice, organisational goals, and care safety standards.

Defining a performance review

In this guide, a performance review is defined as a structured, two-way conversation between a staff member and their manager that:

• Evaluates performance over a set period.
• Recognises achievements and contributions.
• Provides constructive, actionable feedback.
• Sets future goals and development plans.
• Ensures alignment with legal, ethical, and safety standards.

Understanding the purpose of a performance review

A performance review is not simply a compliance requirement or a one-off "catch-up." It is a critical step in the employee lifecycle, building on from recruitment and onboarding to iterative growth and career progression. It's a proactive conversation that strengthens professional practice, builds trust, and supports the delivery of safe, high-quality care.

Benefits of well-conducted performance reviews

Well-conducted performance reviews deliver multiple benefits across the organisation, from individual staff members through to organisational outcomes.

• Improving care outcomes - A well-supported workforce is better equipped to deliver consistent, safe, and effective care.
• Professional development - Reviews create space to identify training needs, career goals, and growth opportunities.
• Retention and morale - Regular recognition and constructive feedback help staff feel valued and supported, reducing turnover risk.
• Early intervention - Identifying and addressing small issues early prevents escalation into formal performance management or person receiving care safety risks.
  

The risks of getting it wrong

Poorly conducted reviews do more harm than good. They can:

• Create a tick-box culture: Reviews seen as "admin" erode trust and disengage staff.
• Embed unconscious bias: Halo effect, recency bias, or affinity bias distort fairness and damage credibility.
• Miss opportunities for growth: Failing to connect reviews to development planning leaves staff unsupported and organisations exposed to repeated risks.

Employment law, Fair Work, and compliance considerations

A performance review that ignores legal obligations is not just poor practice - it exposes the organisation to risk. In Australia, reviews must be conducted within the framework of workplace law, healthcare regulation, and organisational policy. Only then can they be considered fair, transparent, and defensible if challenged.

Key legal frameworks to be aware of

Procedural fairness in practice

Procedural fairness, sometimes called "natural justice", means:

• Providing reasonable notice of the meeting and matters to be discussed.
• Outlining any performance concerns and supporting evidence in advance.
• Giving the employee a genuine opportunity to respond.
• Making decisions impartially and based on evidence, not assumptions.
  

Privacy and record-keeping

Proper management of performance review records is both a legal requirement and a trust-building practice. Ensure that you:

• Follow organisational security and information governance policies for storage, encryption, and retention of records.
• Limit access to authorised personnel only.
• Avoid storing or sharing review records through unsecured channels (e.g., personal email).

Compliance checklist for managers

Use this checklist to ensure your review process meets all compliance requirements:

Manager Skills: Building the Capability Stack

Effective performance reviews don't just rely on a checklist - they rely on the manager's ability to balance empathy, accountability, and compliance. These skills form a capability stack that supports high-quality reviews in healthcare.

Core Capabilities for Managers

The following capabilities are essential for managers conducting effective performance reviews in healthcare settings:

Why the capability stack matters in healthcare

Healthcare presents unique challenges that make these capabilities particularly critical.

• Staff performance directly affects person receiving care safety and quality.
• High emotional stakes (e.g., burnout, compassion fatigue) require managers to lead with empathy and clarity.
• Compliance isn't optional - mishandled reviews can create legal, accreditation, or regulatory risks.

Building capability over time

Developing these capabilities is an ongoing process that requires organisational support

• Organisations should invest in training managers in both technical and soft skills.
• Peer learning (e.g., manager roundtables) helps share strategies for tricky review situations.
• Self-reflection and feedback from employees can highlight gaps in a manager's capability stack.

Planning and preparing for the review

Preparation sets the tone for the review. Done well, it builds trust and clarity; done poorly, it can feel rushed, unfocused, and demotivating. Preparation is both a compliance requirement and an opportunity to foster a constructive, supportive conversation.

Who should conduct the review?

The review should be led by the staff member's direct line manager or a delegated leader who understands their role, responsibilities, and performance context. Reviews lose impact when conducted by someone unfamiliar with the employee's day-to-day work.

Clarifying purpose and goals

Before the meeting, managers should be clear on:

• Why the review is taking place (annual, probation, mid-cycle).
• What needs to be discussed (achievements, challenges, professional goals, safety outcomes).
• What outcomes are expected (development plan, recognition, changes to role scope).
  

Timing and notice

Different types of reviews have different timing requirements that must be observed.

Important: Reviews should never introduce unexpected performance concerns. If serious issues exist, they should be raised as soon as possible, not saved for review.

Format options and considerations

Choose the format that best suits the circumstances and ensures an effective conversation.

If the employee is on extended leave (e.g., parental, workers' compensation), seek HR guidance on timing and approach. Check the applicable EBA/Award or internal policy for the right to bring a support person.

Preparation steps for managers

1. Review past performance records, goals, and training completions.
2. Gather feedback from peers, supervisors, or individuals receiving care (where relevant).
3. Cross-check the agenda with organisational policy and legal requirements.
4. Notify the employee in advance and share any reflection questions or agenda points.
   

Embedding a performance culture (beyond the review itself)

An effective performance review process is only one part of a broader performance culture. In high-performing healthcare teams, feedback, recognition, and development are continuous - not limited to scheduled review dates.

Why culture matters

• Creates trust and openness between staff and leadership.
• Encourages early problem-solving and prevents issues from festering.
• Improves retention by showing staff they are valued year-round.

How to embed a performance culture

Creating rituals helps create an environment where performance discussions become natural and ongoing, such as the following.

Example: Continuous feedback loop

1. Formal review sets goals and action plans.
2. Monthly one-on-one check-ins track progress and address barriers.
3. Peer recognition is encouraged through a simple nomination process.
4. End-of-year review reflects on the entire cycle, drawing from continuous feedback.

Structuring and conducting the conversation

A clear structure keeps the review focused, constructive, and productive. It helps both manager and employee feel confident that important topics will be covered, while avoiding tangents or uncomfortable silences.

A simple, effective structure

This five-step structure provides a clear framework for the review conversation.

1. Opening - Welcome the employee, explain the purpose of the review, and set a positive, collaborative tone.
2. Reflection - Invite the employee to share their self-assessment, achievements, and challenges from the review period.
3. Feedback - Provide evidence-based feedback, covering both strengths and areas for development.
4. Planning - Work together to set clear, achievable goals and agree on any support or resources needed.
5. Close - Summarise the discussion, confirm next steps, and thank the employee for their contributions.`
   

Keeping the conversation constructive and procedurally fair

It is important to follow core principles to keep conversations practically relevant.

Managing challenging elements

A performance review is a formal, summative process that draws together the formative conversations and actions held throughout the year. Concerns such as underperformance, behaviour, or code of conduct should always be addressed at the time they arise, not saved for the review. The review itself is about consolidating progress and planning next steps.

Common scenarios that may still arise include:

• Underperformance (already addressed during the year) - Summarise the actions taken, link to the impact on the team or people receiving care, and confirm next steps.
• Pay or progression discussions - Keep aligned with organisational policy and, where possible, separate from performance improvement.
• Cultural alignment or behaviour - Revisit examples raised earlier in the year, reinforce the link to organisational values, and agree on ways to strengthen alignment.
• Defensiveness or disengagement - If these occur, use empathy, active listening, and open-ended questions to maintain trust and engagement.

The key is that the review is not about presenting new evidence, but about closing the loop on ongoing conversations and setting a clear path forward.

Privacy and escalation pathways

Performance reviews may surface issues that require escalation, such as:

• Alleged professional misconduct.
• Reportable incidents under state or federal legislation.
• Concerns raised under the organisation's whistleblower policy.

In these cases, managers should:

• Follow organisational reporting and escalation procedures.
• Maintain confidentiality as required by law and policy.
• Document discussions accurately, noting any handover to HR or governance teams.

Creating psychological safety in performance reviews

Psychological safety is the belief that people can speak up, ask questions, and make mistakes without fear of humiliation or punishment. In healthcare, where mistakes can have serious consequences, creating a safe environment for open dialogue is essential - not just for staff wellbeing, but also for patient, individual, or client safety.

Why it matters

Psychological safety delivers measurable benefits across multiple dimensions.

• Improves safety outcomes - Staff are more likely to raise concerns about care risks, unsafe practices, or workload pressures.
• Encourages constructive feedback - Both giving and receiving feedback become less defensive and more solution-focused.
• Supports retention and morale - Employees feel valued and respected, reducing burnout and turnover.
• Fosters innovation - When people feel safe to share ideas, teams are more likely to adopt improvements in practice.
• Drives continuous improvement - Honest reflection and open dialogue are essential for learning in complex healthcare environments.

Practical strategies for fostering psychological safety

Try some of these strategies to help create an environment where staff feel safe to engage openly:

• Model openness
• Admit when you don't have all the answers.
• Share your own areas for growth, showing that feedback is normal at all levels.
• Invite input
• Ask: "What support do you need from me?" or "What could improve your work environment?"
• Signal that honest feedback will be received constructively, not punished.
• Listen actively
• Paraphrase and reflect back what you've heard to show understanding.
• Validate emotions even if you can't act on every request.
• Be culturally aware
• Recognise that cultures differ in how people approach authority, directness, and feedback.
• Avoid assuming silence means agreement - it may signal discomfort.
• Adjust body language, tone, and expectations accordingly.
• Normalise feedback
• Offer both praise and constructive feedback informally, outside of reviews.
• This reduces the "high stakes" feeling when the formal review takes place.

Cultural awareness in reviews

Cultural differences can significantly impact how people experience and respond to performance reviews. Consider:

• Body language and eye contact: In some cultures, avoiding eye contact is a sign of respect, not disengagement.
• Directness in feedback: What feels "clear" in one culture may feel "harsh" in another.
• Language barriers: Use plain language and avoid jargon, especially when English is not the employee's first language.
• Time for reflection: Some cultural norms discourage immediate responses; allow space for written follow-up or a second conversation.

Psychological safety doesn't mean avoiding tough conversations - it means creating conditions where staff can engage honestly and constructively, knowing their voice matters and their dignity is respected.

Strategic integration with clinical governance and quality

Performance reviews in healthcare aren't just about the individual staff member – they're also a strategic tool for strengthening safety, quality of care, and compliance with national standards. When managers link reviews to broader organisational goals, they turn what could be a "tick-box" exercise into a driver of systemic improvement.

How performance reviews support clinical governance

• Reinforce role expectations - Reviews provide a structured opportunity to revisit the staff member's position description, performance expectations, and alignment with organisational values.
• Highlight contribution to safety and quality - Connect individual performance to team KPIs, organisational strategy, and the delivery of safe, high-quality care.
• Incorporate feedback - Where available, integrate feedback from patients, residents, individuals, or carers to reinforce the impact of staff on care experiences.
• Strengthen compliance - Conversations can be linked to industry standards and legislative requirements, such as the ACQSC Strengthened Standards or NSQHS Standards.
• Translate data into action - Quality data (e.g. incident reports, complaints, audits, or accreditation results) can be used to inform professional development priorities.
• Embed a learning culture - Framing reviews as part of governance shows staff that performance management isn't about punishment, but about maintaining excellence in care.

Making the link explicit

These examples show how to connect individual performance to broader quality and safety outcomes:

• Person receiving care safety – If feedback or data shows consistently safe and accurate medication administration, the review can highlight this achievement and recognise the staff member's contribution to patient safety. It can also be an opportunity to explore how their good practice might be shared with the team, such as through mentoring or role-modelling.
• Quality improvement – Performance goals can be framed in relation to audit outcomes, e.g., reducing documentation errors or improving infection control compliance.
• Professional development – Reviews are an ideal time to align CPD planning with clinical priorities, ensuring staff maintain up-to-date knowledge and skills.

Example integration in practice

Example conversations for common review scenarios

Below are narrative examples with sample lines to guide your approach in different situations.

Annual review for a consistently high performer

• Opening: Thank them for their contributions and highlight specific achievements.
• Feedback: "Your leadership in the wound care project has been recognised through positive outcomes for residents and strong feedback from colleagues who valued your mentoring and support"
• Planning: Discuss stretch goals or leadership opportunities.
• Closing: "I'm looking forward to seeing you present at next month's best practice forum - it's a great opportunity to share your expertise."

Probation review with mixed feedback

• Opening: "You've made a strong start, and I'd like to talk about what's going well and where we can focus for the next three months."
• Feedback: Highlight strengths first, then address areas for improvement with specific examples.
• Planning: "To help improve your documentation accuracy, we'll pair you with a mentor and arrange a refresher session."
• Closing: Confirm expectations for the remainder of probation and schedule the next check-in.

Addressing underperformance or behavioural issues

• Opening: Acknowledge the purpose upfront - "We need to talk about some concerns with meeting handover deadlines."
• Feedback: Provide clear, factual examples and link to the person receiving care impact.
• Planning: "Let's set up a process where you prepare your notes at least 15 minutes before handover. We'll check in weekly for the next month."
• Closing: Confirm expectations and outline consequences if improvement doesn't occur, following policy.

Responding to differences in pay expectations

• Opening: "I understand you'd like to discuss your pay rate. While pay reviews are handled separately, I can explain how our process works."
• Feedback: Keep the discussion factual and policy-aligned.
• Planning: Redirect the conversation to performance and future opportunities that may lead to progression.
• Closing: Offer to connect them with HR for formal pay review processes.

If a conversation goes wrong

Sometimes conversations can become challenging despite best preparation.

• Stay calm and professional, even if emotions run high.
• Use de-escalation techniques such as lowering your voice, pausing, or summarising key points.
• If the discussion becomes unproductive or unsafe, pause the meeting and reschedule.
• Document the reason and seek guidance from HR.

Available supports for managers

Managers don't need to navigate challenging conversations alone. Support is available through:

• Internal HR or leadership teams for advice and mediation.
• Employee Assistance Programs (EAP) for personal or emotional support - e.g., Ausmed's partner program Talked, which offers confidential counselling services.

Wrapping up: Follow-up, documentation, and next steps

The performance review doesn't end when the meeting does. What happens after the conversation is just as important as what's discussed in the room. Following up promptly and thoroughly reinforces the review's value, ensures accountability, and builds trust that agreements will be honoured.

Post-review steps for managers

1. Document outcomes

• Write a factual, balanced record of the discussion.
• Include agreed goals, timelines, and responsibilities - avoid vague promises.
• Keep documentation professional, neutral, and free from emotive language.

2. Confirm next steps in writing

• Send a follow-up email within a few days, summarising what was agreed.
• Highlight key goals, support to be provided, and agreed checkpoints.
• This protects both parties from misunderstandings and creates a shared reference point.

3. Schedule follow-ups

• Lock in check-in dates to monitor progress - don't leave it open-ended.
• Make follow-ups proportionate: more frequent if concerns were raised, lighter touch if performance is on track.
• Treat these as coaching conversations, not just compliance exercises.

4. Provide resources

• Share relevant training opportunities, mentorship arrangements, or tools discussed during the review.
• Offer clarity on how the employee can access support (e.g., online modules, shadowing opportunities, or protected time for learning).

Extending probation

• Performance reviews during probation carry particular weight. They are not only an opportunity to check progress but also a formal record that can support decisions about employment status.
• Use reviews as checkpoints – flag any performance concerns early and document them clearly.
• Extension triggers – probation may be extended if there are unresolved concerns, but only if:
• This is permitted under the relevant Award/EBA, and
• It aligns with organisational policy.
• Consult HR first – always confirm requirements and timelines before extending.
• Fairness matters – probation extensions should never be a surprise to the employee. Communicate concerns clearly, provide support, and document agreed actions.

Template follow-up email

Tools and resources

• Compliance checklist: Performance review do's and don'ts
• Template agenda
• How to Improve the Employee Experience
• Performance Review Phases

Reference links

• Fair Work Ombudsman – Performance in the workplace
• Privacy Act 1988 (Cth)
• Fair Work Commission – Discrimination
• NSQHS Standards
• ACQSC Strengthened Quality Standards
  

Legal References List

• Fair Work Act 2009 (Cth) - s.387, General Protections provisions.
• Privacy Act 1988 (Cth) - Australian Privacy Principles.
• Anti-Discrimination Act - relevant federal and state/territory laws.
• Enterprise Bargaining Agreements and Awards - specific to your organisation.