Performance Reviews Handbook Statement

Author: Amy E. Mendenhall, Marissa L. Dragoo, Corinn Jackson, and Judith A. Paulson, Littler

When to Include This Statement

An effective performance review process can be integral to an organization's success. Employers should consider including this statement in their handbook to provide employees with information on the review process including a description of the employer's philosophy on performance reviews, how often they are conducted and whether merit increases (or other salary determinations) and employment decisions such as promotions or disciplinary actions, will be made based on the performance review.

Customizable Handbook Statement

Performance Reviews

Performance evaluations are generally scheduled once a year or upon a change in assignments, however, supervisors and employees are strongly encouraged to discuss job performance and goals on an informal, day-to-day basis.

A positive performance review does not guarantee a salary increase or a promotion. These decisions are made at the discretion of the Company and depend on a number of factors in addition to an employee's individual performance.

We reserve the right to make any personnel changes (including termination) before or after performance evaluations.

Guidance for Employers

  • Employers are not required to provide performance appraisals to employees, but it is a good business practice. Performance reviews provide a method for employers to advise employees about their current job performance, to identify problems in an employee's performance and to encourage an employee to improve before it becomes a discipline issue.
  • A record of fair, honest and accurate performance reviews can be helpful when defending claims of discrimination or retaliation by showing that an adverse job action was legitimate and based upon the employee's performance.
  • Performance appraisals provide an opportunity for employees and supervisors to discuss individual work objectives and progress toward goals, as well as possible career opportunities within the Company.
  • The performance appraisal process should be fair and consistently applied and must comply with a variety of nondiscrimination laws, including Title VII (Equal Employment Opportunity), the Equal Pay Act, the Family and Medical Leave Act (FMLA), the Americans with Disabilities Act (ADA) and the Uniformed Services Employment and Reemployment Rights Act (USERRA).
  • The performance appraisal process should reflect the Company's culture and corporate objectives and incorporate best practices in performance management.
  • Determine the goals of the performance appraisal process, such as recording performance, tracking goal progress, determining compensation and/or providing employee development.
  • Decide upon a time frame/frequency for appraisals, participants, performance measures, procedures, outcomes (e.g., goals and personal development plans), system monitoring and rewards.
  • Ensure that all areas addressed in the performance appraisal are job-related.
  • Establish a procedure by which the supervisor's written performance appraisal is checked for objectivity, job-relatedness and timeliness.
  • Supplement formal performance reviews with regular, personal feedback about an employee's performance. Hiding criticism only leads to employees not understanding the extent of their performance issues, and no employee should learn of a problem for the first time in a performance appraisal. Performance appraisals should be a review of what an employee already knows - good or bad.
  • Train supervisors on how to complete a performance appraisal form and how to provide feedback in effective performance-management discussions.
  • Advise employees on what to expect from a performance appraisal, including their role in the performance dialogue.
  • Be sure that performance appraisals are properly documented and maintained in employee personnel files.
  • While performance reviews may lead to a promotion or salary increase, the policy statement should build in flexibility to consider multiple factors before granting a promotion or salary increase such as market/industry conditions and the company's general economic condition.

Additional Resources

Performance Appraisals - Supervisor Briefing