StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...
Free

Employee Performance Appraisal Systems - Essay Example

Cite this document
Summary
This paper Employee Performance Appraisal Systems talks that employer’s interest in performance level and differentiation between poor and good performance has increased dramatically over the years due to constant pressures like competition. …
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER96% of users find it useful
Employee Performance Appraisal Systems
Read Text Preview

Extract of sample "Employee Performance Appraisal Systems"

Running head: Employee Performance Appraisal Systems Employee Performance Appraisal Systems s Assessing the Legal Implications of Employee Performance Appraisal Systems Introduction Employer's interest in performance level and differentiation between poor and good performance has increased dramatically over the years due to constant pressures like competition, increased productivity requirements and quality control strictness. There are various ways to conduct performance appraisals. Some of the major ways that performance appraisal is done include the following: (Ilgen and Feldman, 1983) 1. identifying the behaviour or element of job performance that needs to reiterated or removed for better employee performance 2. Identifying the areas and elements where performance can be linked to reward and compensation. 3. Identifying tasks and assigning responsibility as well as authority, along with perhaps targets to see which ones have been achieved, as an objective measure of performance. (Ilgen and Feldman, 1983) There are other collaborative techniques that employers use in order to evaluate employee performance and these techniques can be quite helpful in conducting performance appraisals as well. These techniques include management by objectives or MBO, work planning and review, peer review, 360 degree appraisal among other techniques. These techniques are stated to be more appropriate and useful than quantitative techniques since their major advantage is highlighting areas of development and achievement. (Ilgen and Feldman, 1983, ABA Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) There are various benefits of these techniques; however, they are not without some limitations. Below, the paper is going to highlight the importance of employee appraisals, the reason why they are important, the benefits and banes of performance appraisals and more importantly, the legal implication of employee appraisals wrapping up the paper with a conclusive statement. (Ilgen and Feldman, 1983, ABA Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) Employee Performance Appraisal Systems According to, Ilgen and Feldman performance appraisal process is a three part interactive system in which the "organizational context, the appraiser's information processing system, and the behavioural system of the appraisee" (Ilgen and Feldman, 1983) are analyzed. The primary purpose of this research was to understand the process of performance appraisal in terms of behavioural theories and then improve the appraisal process. (Ilgen and Feldman, 1983) There are various researches conducted on the subject of employee performance appraisal. The basic concept is that employee appraisal has always been considered the task of the employer rather than considering in the element of a 360 degree evaluation. A 360 degree appraisal has several benefits that can be summed by saying that the evaluation works on all levels and provides a more comprehensive, well rounded approach to performance appraisals. Some researchers propose that self appraisals be made part of the appraisal process to evaluate work performance. Self appraisals however, are also studied to be more lenient, less variable and less discriminant with less halo effect as well. This is probably because the employee knows the amount of work they have done, how much effort they have put in, but leniency arises when employees consider themselves on an easier scale and project themselves positively than normal. However, problem areas of self appraisals become magnified in areas where decision making capability needs to be evaluated, along with identifying training need and applied criteria of elevation in terms of tasks and processes. (Murphy and Margulies, 1980) The research also points out that employee self appraisal is a method that falls in the same category as employer appraisal as it helps develop the employee's motivation and helps him or her participate in management. Murphy and Margulies do identify several factors that are important and should be part of the performance appraisals. However, there are various elements that create problems in conducting performance appraisals that can lead to legal complications and thus need to be catered to. (Murphy and Margulies, 1980) Fletcher in his research states that performance appraisals used to be a term used to signify the basic concept of the line manager evaluating the subordinate's performance on an annual basis, and perhaps discussing it with the subordinate as well if required. Though various organizations still run on the same principal, many other organizations have come out of that loop and developed a better rounded approach to personnel evaluation. (Murphy and Margulies, 1980, William, 1998, Fletcher, 1998, Fletcher, 2001) Many organizations link performance appraisal to employee performance evaluation, developing a reward and compensation criteria and improving productivity. Performance management has been a concept which has been in the industry for a significant period of time, and now performance appraisals have become part of this management process. Williams specifies in his research that there are three processes or models of performance management: (Murphy and Margulies, 1980, William, 1998, Fletcher, 1998, Fletcher, 2001) For managing employee's performance For managing the organizational performance And integrating both these efforts. (Williams, 1998, Fletcher, 1998, Fletcher, 2001) Performance appraisals have now expanded to the concept of a range of practices with a strategic approach that formulate and integrate personnel and human resource management activities to the strategies and policies of the business. The current performance appraisal techniques utilized in organizations, though have not focused on measuring overall performance through separate job dimensions, expand into aligning the goal of the employee to the organization's goal. "One of the major recent developments in criterion theory is the distinction between task and citizenship performance. Task performance has long been recognized as the core of a job and is generally used as a point of comparison (implicitly or explicitly) in describing citizenship performance." (Lievens, James and Wilfried, 2008) Anderson and Herriot in the book, Assessment and Selection in Organizations - Methods and Practice for Recruitment and Appraisal, explain that performance appraisals have changed in organizations for the better. The function of appraisals has changed as such, as new contexts have been developed in decision making thus going beyond the traditional view of human resource management. The basic view is that due to changes in technology, jobs themselves have changed such as continuous change, knowledge driven organizations, changes in the functional content of tasks and jobs, etc, and thus performance appraisal techniques have to be updated in accordance with such changes in the industry. In evaluating the various techniques available for employee evaluation and their performance appraisal, various researches also indicate that there are various conflicting uses of appraisal techniques, as there are conflicting and multiple goals being analyzed and fulfilled. (Kane & Lawler, 1979; McGregor, 1957; Meyer, Kay, & French, 1965) for example, appraisals are used not only for evaluating whether employees have to be promoted but also guiding their development. Comparisons therefore become difficult when the person has to decide between individuals for a promotion, and within the individual for laying down the training needs of the employees. (Drenth, 1984) Some authors state that performance appraisals do not have a huge amount of research associated with them, in terms of appraisals being decision making tools for the management. In this regard, some authors do propose the benefits and problems associated with the usage of performance appraisal techniques. (Scholarios, 1997, Cleveland, Murphy and Williams, 1989) Problems Faced With Employee Performance Appraisal Systems One of the major problems at hand is that appraisers have a halo effect when evaluating employees. In this case, they rely on their memory for the cognitive process and thus are not able to recall specifically the jobs and the tasks performed along with ratee information. In this case, rating errors can result due to this halo effect. Moreover, there are cases when recent activities and performance becomes more apparent than pervious impressions thus not allowing complete information retrieval, leading to inaccurate ratings. Additionally, categorization and generalization may also affect employee performance appraisal. (Scholarios, 1997, Cleveland, Murphy and Williams, 1989, Bretz, Milkovich and Read. 1992) Legal Implications of Employee Appraisal Systems Malos in his book identifies that there are numerous legal issues that have arisen over the years due to employee appraisal methods and systems. He has found a whooping five hundred cases of judicial and arbitration decisions that have been decided for employee appraisal system cases. What is disconcerting is the fact that in most cases, the employees have been found to be qualified for the job having good performance and subsequent evaluation and they were either not hired, or not promoted, or not recommended for retraining resulting in discriminatory behaviour towards them from their employers or potential employers. (Malos, 1998) The Civil Rights Act of 1991 clearly identifies several elements that are potentially damaging for employers in terms of punitive damages and compensation due to discriminatory behaviour towards employees in terms of performance appraisals etc. Moreover, in a lot of cases, employees also exercise their right to identify they have been discriminated against and thus the problem and impact of damages has risen significantly over the past years. (Malos, 1998) The Civil Rights Act defines various elements that are considered to have legal implications when an employer performs these acts. These include misrepresentation, defamation and negligence. As explained earlier, performance appraisals are used for the purpose of identifying employees who can be promoted, given a raise or trained, retrained, transferred etc. In such a regard, the performance appraisal is used with various ratings that identify such elements. In all such cases, there is a potential for the employee to understand and evaluate it as discrimination under various acts and defined legal framework. Lawsuits may be filed under the acts of Fair Labor Standards Act or Family and Medical Leave Act. (Malos, 1998) On the other hand, there are no specific legal acts that determine how a performance appraisal has to be done therefore; employers have a huge leeway when it comes to appraising their employees' performance. However, under the employment at will relationship, the employer or employee both have the right to terminate their relationship based on their discretion. Nonetheless, employers are more bound with exceptions present in the labour law that are not in favour of the employer, but rather in favour of the employee. (Malos, 1998, Gomez-Mejia, Balkin and Cardy, 1995) Following table defines elements of the law that are related to performance appraisals and the legal implications involved: Legal Principle or Law Summary Relationship to Performance Appraisal and Employee Relationship Employment at will Status under which the employer or employee may end an employment relationship at any time. Allows the employer considerable latitude in determining whether, when and how to appraise employees. Implied Contract Non explicit agreement that affects some aspects of the employment relationship. May restrict manner in which employer can use appraisal results (for example, may prevent termination unless for cause) Violation of Public Policy Determination that given action is adverse to the public welfare and is therefore prohibited. May restrict manner in which employer can use appraisal results (for example, may prevent retaliation for reporting illegal conduct by employer) Negligence Breach of duty to conduct performance appraisals with due care Potential liability may require employer to inform employee of poor performance and provide opportunity to improve. Defamation Disclosure of untrue unfavourable performance information that damages an employee's reputation. Potential liability may restrict manner in which negative performance information can be communicated to others. Misrepresentation Disclosure of untrue favourable performance information that that causes risk of harm to others. Potential liability may restrict willingness of employer to provide references altogether even for good former employees. Fair Labour Standards Act (FLSA) Imposes (among other things) obligation to pay overtime to non exempt (non managerial) employees. Fact that employee conducts appraisal may influence determination that employee functions as supervisor or manager and is therefore exempt. Family and Medical Leave Act (FMLA) Imposes (among other things) obligation to reinstate employee returning from leave to similar position. Subjecting employee to new or tougher appraisal procedures upon return may suggest employee has not been given similar position of employment. (Table excerpted from the book, Malos, 1998) In a particular case, performance appraisal was linked to the employee's raise and performance benefits. However, those benefits were not provided to them on the basis of their performance level. In such a case, harassment charges were brought against the employer and the performance evaluation was considered very harsh in line with the performance thus denying performance benefits. This case relates to Ton vs. Information Resources Inc in which Ton defied the employer's sexual advances and thus the performance evaluation was unexplainably harsh causing loss of employee performance benefits. (Malos, 1998) Malos suggests that in order to improve employee's performance and avoid any such circumstances that lead towards discrimination lawsuits, employers should have a timely noting of all performance activities that the employee has done in order to keep a track record of the tasks performed and the performance shown for the tasks. Moreover, human resource documentation is also very important as offer letters, employee handbooks and manuals should be defined for the employee that explain everything and tangibly define performance appraisal techniques, methods and procedures to be used. This will help express at will, what the employee should be expecting from the organization and from the employer. (Malos, 1998) There are various practical ways and means that help legally clarify and define the relationship of the employer and employee as some of them have been defined above. The employer should also define in explicit terms that the performance appraisal is not the just cause for terminating a relationship between the employer and the employee and that performance appraisals are not a definition of this relationship. Malos defines that employment conditions and terms should be understood at will. Moreover, the employer should clarify in explicit terms to the employee that the employer reserves the right to terminate the employee relationship without any reason or cause and without notice as well. Other suggestions include that the performance appraisal is not the method to define continuation of employee and employer relationship and thus should not be treated as so. (Malos, 1998) Further suggestions for limiting legal complications with performance appraisals include the employer specifying to the employee that performance appraisal methods and terms and conditions of employment are under the umbrella of the employer and he or she may change them accordingly without any notice. Moreover, the employer also does not have to conduct any performance appraisal as it is at the discretion of the employer. However, the employer cannot ask the employee to leave and make the performance appraisal as the just cause for the termination of employment. All of these suggestions given by Malos are actually excerpted from various law cases that have taken place and he specifies that these are the areas which need to be focused on by employers, for performance appraisal in order to limit legal complications brought on to them. (Malos, 1998) Malos also identifies that the performance appraisal criteria and technique should be such that it does not discriminate against employees who have a disability since the disability does not affect employee's performance. Moreover, class differences should not be made either as was the case in McDonnell Douglas Corp Vs. Green where the job remained open when Green was rejected by the organization and Green was rejected primarily due to a class difference as Green was not from the protected class. (Malos, 1998) A successful appraisal system involves various elements that are legally as well as professionally correct. Employees should be given clear indication explicitly as to what performance appraisal systems and methods entail, in the organization. Additionally, raters should be trained and their instructions should also be clear as to what is required in the performance appraisal and how they are entitled to conduct performance evaluation through the designed system. Job duties, their nature and their importance are all important to be identified and disclosed to the rater in order to allow the rater to conduct a performance appraisal. (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) Moreover, the employee's performance has to be known completely by the rater as well on what to rate the employee on. Job related appraisal systems are the best means to conduct a performance appraisal so that the evaluation can be related to the job and the tasks that it entails. This will help the employee to improve on his or her performance as well. In some cases, performance raters may be biased or they have a mental discrimination against which precautions have to be taken and are very important in order to avoid lawsuits and legal complications. In some cases, uniformity in approach may not be present, and which is very important thus only one person should not be finalizing the ratings for the employee so that standardization can be maintained. (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) The employee also should be allowed to review, comment and evaluate the rating and the reason for the rating. The employee can sign and signify that he or she has read the review but is not necessarily agreeable on the rating. "Most truly effective performance appraisal systems are characterized by the fact that those administering the performance appraisals are well trained. Instead of offering simple instructions to performance raters, organizations that want the most from their appraisal process usually implement training programs to correct a rater's common mistakes high and low performers." (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) There are various mistakes that employers can make during conducting a performance evaluation and which need to be avoided in order to comply with laws and various employment acts. Such problems were also identified earlier. However, some of the most common mistakes are halo effect when one excellent rating can lead to an entire performance appraisal to be done as excellent for that employee. (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) Moreover, employers may also be either too lenient or extremely stringent in their performance appraisal and thus may not consider the employee average in any rating scale. Moreover, one of the major mistakes that employers often do is compare and contrast employees against each other when performance should be against the job requirements and the job description. First impressions also create a problem for the employee and thus this may overshadow the actual work they have done in the organization. (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) Thus in order to create an efficient system of appraisals, it is important that the employer develops such a system that focuses on understanding and evaluating the employee against the job description and the activities that it entails. Moreover, employers should consider all the laws and acts applicable for employee appraisals in order to avoid legal complications creating a problem in terms of punitive and reputation damage for the company. (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004) Considering the various law cases that Malos identifies in terms of performance appraisals of employees, and the lawsuits filed against organizations against these appraisals, it is important that all bases are covered since the law primarily focuses on the benefits from the employee's perspective rather than the employer's perspective. In quite a few cases, discrimination is the primary objective of the lawsuit and if performance appraisals and employment are done in accordance with the suggestions defined by the Equal Employment Opportunity Committee and Malos, chances of a lawsuit can be reduced by the organizations since legal complications arise when requirements are not clear and employees do not considered themselves an important part of the organization in the eyes of the employer. (Labor and Employment Law Section - Equal Employment Opportunity Committee, 2004, Malos, 1998) References ABA Labor and Employment Law Section Equal Employment Opportunity Committee (2004) Mid-Winter Meeting Anderson N, Herriot P. (1994) Assessment and Selection in Organizations. Methods and Practice for Recruitment and Appraisal. Wiley. 1994. Pp. 136. Bretz, Milkovich and Read. (1992) The Current State of Performance Appraisal Research and Practice: Concerns, Directions, and Implications Center for Advanced Human Resource Studies (CAHRS) CAHRS Working Paper Series Drenth, P. D. (1984). Personnel appraisal. In P.Drenth, H.Thienry, P.Williams, & C.deWolff (Eds.), Handbook of work and organizational psychology: Vol. 1 (pp. 197-233). New York: Wiley. Filip, L, Conway, J & Corte W De. (2008) The relative importance of task, citizenship and counterproductive performance to job performance ratings: Do rater source and team-based culture matter Journal of Occupational & Organizational Psychology; Vol. 81 Issue 1. Fletcher, C. (1998). Circular argument. People Management, 1 October, pp. 46, 49. Fletcher, C. (2001).Performance appraisal and management: The developing research agenda. Journal of Occupational & Organizational Psychology. Vol. 74 Issue 4. Ilgen, Daniel R & Feldman, Jack M.(1983) Performance appraisal: A process focus. Research in Organizational Behavior. Vol 5, 141-197. Jeanette N., Murphy, Kevin R., Williams, Richard E., (1989) Multiple Uses of Performance Appraisal: Prevalence and Correlates. Journal of Applied Psychology, Vol. 74, Issue Kane, J., & Lawler, E. (1979). Performance appraisal effectiveness. In B.Staw (Ed.), Research in organizational behavior: Vol. 1Greenwich, CT: JAI Press. McGregor, D. (1957). An uneasy look at performance appraisal. Harvard Business Review, 35(3), 89-94. Meyer, H., Kay, E., & French, J. (1965). Split roles in performance appraisal. Harvard Business Review, 43, 123-129. Murphy T & Margulies, J. (1980) Performance Appraisals. Personnel Psychology, 33 Scholarios, D. (1997) Assessment and Selection in Organizations. Methods and Practice for Recruitment and Appraisal. Journal of Occupational & Organizational Psychology, Vol. 70, Issue 3 Williams, R. (1998). Performance management. London: International Thomson Business Press (Essential Business Psychology Series). Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Employee Performance Appraisal Systems Essay Example | Topics and Well Written Essays - 3250 words”, n.d.)
Employee Performance Appraisal Systems Essay Example | Topics and Well Written Essays - 3250 words. Retrieved from https://studentshare.org/social-science/1515318-employee-performance-appraisal-systems
(Employee Performance Appraisal Systems Essay Example | Topics and Well Written Essays - 3250 Words)
Employee Performance Appraisal Systems Essay Example | Topics and Well Written Essays - 3250 Words. https://studentshare.org/social-science/1515318-employee-performance-appraisal-systems.
“Employee Performance Appraisal Systems Essay Example | Topics and Well Written Essays - 3250 Words”, n.d. https://studentshare.org/social-science/1515318-employee-performance-appraisal-systems.
  • Cited: 0 times

CHECK THESE SAMPLES OF Employee Performance Appraisal Systems

Performance Appraisal Assignment

Potential Forms of Bias Most of the performance appraisal systems are characterized with some potential forms of bias.... performance appraisal performance appraisal Introduction performance appraisal or interchangeably performance measurement can be simply referred to the process of monitoring and reporting varied information concerning the performance of an employee, group, or organisation.... Since performance appraisal is an effective way to boost organizational productivity and competitiveness, this management tool has the potential to influence the firm's net profitability....
3 Pages (750 words) Assignment

Performance Appraisals

This paper “Performance Appraisals” evaluates how performance appraisal pertains to business communication between parties giving and receiving the reviews.... In the process of performance appraisal data is collected using three methods namely; personnel, judgment and objective production.... performance appraisal is also used in performance management where subordinates are given a chance to appraise their employer's performance in meeting their expectations and relaying such expectations to employers (DeNisi & Pritchard, 2006)....
5 Pages (1250 words) Research Paper

Managing Employee Behaviour

performance Appraisals performance Appraisals play a significant role in managing employee behavior and accomplishing organizational goals within organizations.... In fact, performance appraisals are effective management tools employed by managers “to direct and control employee behavior, distribute organizational rewards, improve employee work performance, or develop employee capabilities” (Tompkins 250).... hellip; It is essential to assess and evaluate the performance of each employee in an organization....
5 Pages (1250 words) Research Paper

Performance Management

This is one of the most popular performance appraisal systems.... Impact on employees The performance appraisal is conducted fairly and with an open mind often has a positive.... My department's appraisal is based on the performance measurement system that uses graphic scales.... There is a probability for a contrast effect, that is an average employee following an outstanding employee may be rated as poor, an average person following after an employee with a poor rating may be graded excellent When the appraisal is executed fairly and squarely, the employee comes away happy with the rating he received....
4 Pages (1000 words) Essay

The Use of Human Resource Service Centers

The later section of the project deals with the literature review of performance appraisal where previously conducted research has been taken into consideration in order generate to ideas and to make the base stronger.... The last two section deals with the problems as well as recommendations for performance appraisal.... In the year 1950, it was recognized that appraisal is a useful tool for motivation as well as development of the employees....
10 Pages (2500 words) Term Paper

APPRAISE PERFORMANCE

According to Jackson and Mathis (349), there are several errors that may arise in the process of performance appraisal, where the rating system is subjected to flaws.... Examples of close… iduals who can be used in the evaluation process include; supervisors or managers, peers, team members, self conducted appraisal, subordinates, customers and clients.... The reason why as many people directly dealing with an employee being appraised should be involved in the task When only one person is involved in the process, the risks of low objectivity and errors may compromise the delivery of good appraisal report....
4 Pages (1000 words) Essay

Personnel Appraisal System

This report covers the soft systems analysis for the possible implementation of a personnel appraisal process, it will make changes to personnel processes and the data kept on individuals throughout the company.... The soft systems analysis consists of studying present processes against the changes will happen when the new system is working, taking into account any issue based problems not immediately apparent, but which could impact on the final implementation if it happens....
4 Pages (1000 words) Coursework

Employee Appraisals

… The author states that the performance appraisal system serves several purposes.... In the paper “Employee Appraisals” the author analyzes performance appraisals, a method that ensures that employees stay relevant and that they put forward their best performances for the benefit of the corporation; how performance appraisals can help the company achieve its strategic objectives.... They are known to provide the management and the employees the opportunities they need to review prior performance, discuss, or communicate expectations of each party, and make plans for the future development of the company....
4 Pages (1000 words) Assignment
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us