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Necessary evil? Study blasts performance reviews, but documentation still vital

A survey showing most U.S. office workers have negative feelings toward traditional performance reviews may not be earth-shattering news. It’s hardly a surprise to learn that large numbers of employees consider such reviews stressful, tiresome time-wasters with fallout often coming in the form of tears and resignations from disappointed workers. 

Despite widespread disapproval, traditional reviews survive because employees need to know where they stand and employers need a record of employee performance and how they’ve communicated expectations to employees.

So what’s the answer? Software giant Adobe—responsible for the new survey titled “Performance Reviews Get a Failing Grade—touts its “Check-in” system as a way to solve many of the ills of traditional evaluations. Check-in emphasizes frequent communication on priorities, ongoing feedback, and no formal ratings or rankings. Also, managers determine compensation based on performance but without going through a formal rating or ranking process connected to a formal performance review.

Survey findings
Adobe surveyed 1,500 U.S. office workers and found that 57 percent felt traditional written reviews, which are conducted on a mandated frequency and often include rankings and ratings, put them in competition with one another, and 61 percent said their manager plays favorites.

The survey also found that 61 percent of millennials would switch jobs to a company with no formal reviews even if pay and job level were the same. Thirty-four percent of the millennials in the survey said they have cried after a review, 47 percent have looked for another job, and 30 percent say they’ve quit.

Men reported the strongest reactions, with 25 percent of men and just 18 percent of women saying they have cried after a review. The study found that 43 percent of the men and 31 percent of the women had looked for another job following a review, and 28 percent of the men and 11 percent of the women said they had quit a job after a review.

The survey also found that many workers and their managers consider reviews a waste of time. The managers reported spending, on average, 17 hours per employee preparing for a review. Most of the workers said they felt that performance reviews have no impact on how they do their job and are an unnecessary human resources requirement.

Eighty percent of the workers in the survey said they want feedback in the moment rather than aggregated feedback from a review period. Fifty-five percent of the workers and 66 percent of the managers said they wish their companies would get rid of or change the current review process.

Necessary evil?
Despite the negative attitudes surrounding traditional reviews, they continue to be widely used for a variety of reasons, including their relationship to compensation decisions and as crucial documentation when employees make discrimination, retaliation, wrongful discharge, or other legal claims.

Jeff Nolan, an attorney with Dinse, Knapp & McAndrew, P.C. in Burlington, Vermont, says employers that conduct traditional annual reviews must recognize the importance of the documents. In a November 2016 article for Vermont Employment Law Letter, he emphasizes that supervisors must take the reviews seriously and not just focus on cranking them out.

“Supervisors must understand that they are charged with encapsulating a year’s work, or lack of work, in one document and that in the event of a dispute, they (and the employer) will be stuck with that capsule forever, for better or worse,” Nolan wrote. Good-quality evaluations are crucial to the defense of employment claims, and poorly done reviews are crucial to a disgruntled employee’s attorney, he says.

If an annual evaluation is the only written documentation of an employee’s performance, it may come, “in the context of litigation, to define that year conclusively and exclusively,” Nolan says.

Supervisors need to be trained to avoid certain common mistakes that can be problematic for the employer. Here are a few of the common problems Nolan warns against:

  • A failure to be comprehensive about performance problems. A supervisor may recall details about an employee’s shortcomings in previous years, but if those problems aren’t included in the annual reviews for those years, the employee’s attorney will argue that the supervisor didn’t feel the problems were important until the company was looking for an excuse to fire the employee. Or the employee can claim the problems never even existed.
  • A failure to take quantitative measures seriously. If grades on a form don’t match “the more subjective narrative or the supervisor’s candid description,” the inconsistency can make the review useless as a defense to a claim.
  • Sugar-coated evaluations. Employers will find it difficult to justify a negative employment action if the written evaluation contradicts the stated basis for the action.
  • Failing to praise good work. Just as sugar-coating performance can cause problems, reviews that overlook good performance can result in harm since a uniformly negative evaluation will appear to be biased or retaliatory if the employee has done good work in some areas.