Guard Against Performance Rating Errors

Ensure Accurate Performance Appraisals

Sep 4, 2009

Performance rating errors distort perceptions of employee performance. Managers can guard against them through awareness, documentation and definition of expectations.

Several common performance rating errors can interfere with the performance appraisal process by diminishing the accuracy, effectiveness and fairness of ratings. Managers can avoid committing these errors once they understand them and how they occur.

Accuracy of Recall

Managers who fail to maintain accurate and complete notes on employee performance are totally dependent on recall, and memory can be faulty at best. To eliminate this problem, managers should keep written notes on significant events, both positive and negative, in employee performance.

The Halo Effect

This occurs when the rater is influenced by one or more outstanding characteristics of the employee. These exceptional characteristics – which may be either positive or negative – bias the manager’s perception. In other words, the manager fails to take into account the entire spectrum of the individual's skills, characteristics, or behaviors and perceives him or her in an unrealistically positive or negative way. To counter the halo effect, the manager should concentrate on specific, observed behaviors.

Stereotyping

The employee is classified or evaluated in a certain way because of apparent membership in a particular category of people. The rater believes that people in this category share certain characteristics which may be viewed either favorably or unfavorably. Common stereotypes are based on race, age, religion and sex. When a manager holds a stereotype, it is easy to interpret behavior according to that belief.

The problem is that stereotypes are often inconsistent with reality. The way to overcome stereotyping is to document performance and to base evaluations on observed, specific behaviors.

Differences in Rating Standards

Two raters with differing internal standards may observe the same behaviors and assign very different ratings. The less clear the employee's goals and defined behavioral expectations, the more likely the manager will be to rely on an internal set of standards rather than on objective measures.

Projection

This happens when the rater allows his or her own characteristics and values to influence the rating instead of measuring against clearly defined expectations that are understood by both the evaluator and the employee.

Contrast Error

Employees are compared to each other rather than rated against objective performance standards.

Recency Error

Raters typically discount events that occurred early in the rating period and overemphasize those that occurred later. Regular review sessions and consistent documentation can overcome this error.

Causality

This error occurs when the rater confuses the actual observation of a person's work behavior with assumptions about its underlying cause. For example, if an employee hands in a report two days late, the manager clearly observes this undesirable behavior.

At the same time, the following inferences might be made about the reason behind it: the employee does not respect deadlines, the employee lacks time management skills, or perhaps something beyond the employee’s control caused the work to be late.

How does the manager know which is the actual cause? Without taking other samples of behavior, it may be difficult to tell. The secret in determining causality is ensuring that frequent observations are made of employee work behavior. These should be supported by documentation.

If managers record significant behaviors often enough, they will be able to see trends in performance. Then they can make general statements about underlying causality that they can support (e.g., that the employee routinely ignores deadlines, etc.). Thus, the job of coaching and counseling becomes much easier.

Keys to Overcoming Performance Rating Errors

Good performance documentation is the first key to overcoming rating errors. Written notes, regularly updated, can also serve as a source of specific information for coaching and counseling and as required documentation for progressive discipline cases.

The second key is clear definition of employee objectives and performance expectations. If both the manager and the employee have a clear understanding of what is expected on the job, the entire performance evaluation process becomes much more effective.

The copyright of the article Guard Against Performance Rating Errors in Human Resources Management is owned by Wayne Smith. Permission to republish Guard Against Performance Rating Errors in print or online must be granted by the author in writing.