Employee evaluations

Employee evaluations (or appraisals) are meetings between employees and supervisors that allow the parties to discuss the employee’s performance. While it is not a legal requirement to carry out such appraisals, they are generally used to:

• determine whether targets have been achieved

•  make decisions about the employee’s future work

• make career planning decisions

• assess whether an employee may receive a bonus and/or pay increase

Performance evaluation is the process of evaluating how effective an employee is in fulfilling their objectives and responsibilities according to the requirements of their role. They are important because they highlight opportunities for professional development. 

Performance appraisals generally involve an assessment of the employee’s performance against their key objectives. The employee’s key objectives should be set and agreed between the employee and the manager, and the employee’s performance should be tracked against them.

Key objectives are a great way to measure an employee’s performance by setting out what an employee wishes to achieve within a given time period. They are useful for employees and managers as they are able to measure specific, achievable and realistic goals in a timely manner. They can also be helpful for managers to assess if the employee has reached their targets and whether a promotion is necessary.

Such key performance indicators can focus on a variety of things, including:

• productivity -  for example, the manager and employee may set a target on how many sales the employee should aim to reach by the end of the next quarter, such as three more sales at the end of the week. 

• efficiency - accomplishing effective work outputs by making fewer mistakes and provide a precise measure to help employees assess their performance

• education - if the employee requires training for a particular part of their role that can be part of a promotional position. For example, completing a management training course if they want to become a manager in the future

• time management - this can be a skill that the manager can support an employee with and whether discussions around how to prioritise work effectively for the employee to manage their time better

It is up to the employer to decide how often employee evaluations should be held. Generally, evaluations should take place at least once a year, but employers may choose to hold them more frequently (ie every 6 months). This is the ‘review period’. Employee appraisals should also be supplemented with regular one-on-ones between the employee and their line manager.

Employee appraisals involve discussions around an employee's day-to-day duties, work habits and expectations. Often, an employee self-appraisal is discussed during the evaluation when considering promotions

Appraisals will generally involve the employee and their line manager (also known as the ‘reporting manager’). The reporting manager’s manager (also known as the ‘review manager’) should also be involved in the appraisal process to: 

• monitor actions

• check the consistency of comments

• gain upward information

• act as a line of appeal to ensure the fairness and credibility of the appraisal

Employee evaluations should be conducted in a quiet area, free from distractions and other colleagues. This would ensure that both the employee and the manager feel comfortable discussing matters and ensures confidentiality. 

The reporting manager (ie the person conducting the evaluation) should come prepared with specific feedback, notes and any points they wish to address to make sure that the meeting stays on track. With this, the manager guarantees that critical points are not missed. 

Remember to keep the evaluation as an open, two-way conversation rather than a lecture as this gives the employee a chance to discuss their self-assessment and raise any concerns. If the employee is reserved, the manager can ease the conversation by asking open-ended questions such as, ‘How are you finding the role so far?’ or ‘What do you enjoy the most about being in this role?’

For more information, see ACAS’ guidance on Employee appraisals.

While there are a number of employee evaluations the most common are:

• self-assessments - giving an opportunity for the employee to document their perspective on their performance, actions, choices and room for improvements. It showcases to the manager of the employees views themselves in relation to a team and how they fit in the company

• performance reviews - a formal assessment allowing the manager to evaluate the employee’s work performance. This can act as a regular review, carried out on a recurring basis (eg monthly or quarterly) depending on the role and the company’s expectations

• evaluations for promotion purposes - an assessment of the employee’s potential and their suitability for promotion. Factors that may be considered when evaluating the potential for a promotion may include the employee’s attitude to work, punctuality, meeting deadlines, willingness to progress in the company and whether they are a team player

Depending on the type of employee evaluation, a variety of things may be discussed and recorded, including:

• the employee’s key objectives for the review period

• the employee’s areas of strength and areas for improvement

• whether the employee would benefit from further training or development

• any interests the employee may have in other roles, areas and/or departments of the business 

• a rating of the employee performance (eg outstanding performance, standard, below standard or unsatisfactory) and the reasoning behind this

• an assessment of the employee’s potential for promotion, detailing roles the employee may be suitable for with or without additional training or development action

While there is no set standard for how an employee’s performance should be evaluated, it is important that businesses have a clear and fair approach towards appraisals to avoid potential conflicts (eg discrimination). Having a set Employee performance review form helps managers review every employee against company standards on a level playing ground.

When conducting an employee evaluation, managers should consider the following:

• performance standards - this sets out the expectations from the employee within their role. These standards should typically apply to all employees that are in the same position to be fair

• tracking performances - keeping a file designated to each employee is a great way to record their accomplishments and incidents

• individual goals - having agreed upon individual goals allows the employee’s performance to be tracked and assessed against them in an objective and fair manner

• strengths and weaknesses - the employee’s specific strengths and weaknesses should be assessed against their individual goals. Avoid comparing employee performances with others in the workplace

• be honest with constructive criticism - provide clear examples of situations where an employee has done well and where they can improve to help the employee with their personal or professional development

• training and/or further development actions - consider any training and/or development opportunities the employee could benefit from. Such training may be offered to help the employee improve their weaknesses or to help enhance their skills and knowledge

• career development - this sets out what areas the employee shows an interest in and how they may develop their career going forward

• asking specific questions - focusing on specific questions can help managers understand an employee's feedback, for example, what are the employee’s long and short term goals?

• employee questions or concerns - during the appraisal the employee should be encouraged to share any questions or concerns they may have about their role or career progression

For more information, see ACAS’ guidance on Employee appraisals.

Once the employee evaluation has been completed, it is generally signed off by the reporting line manager before the reviewing manager will review and sign off the appraisal.

The outcome of the appraisal and the evaluation report should be made available for the employee to review and express their views on the appraisal they have received; in particular, whether they feel it is a fair assessment of their work (eg performance or suitability for promotion). Employees should sign the completed evaluation report as evidence of their review.

The completed and signed employee evaluation will then typically be kept as a record of the employee’s development and progress.

After an appraisal has been conducted and the employee evaluation form has been signed, the reporting manager and the employee should typically meet to discuss the appraisal outcome. This is an opportunity for both parties to discuss the appraisal, provide feedback and raise any concerns or questions.

The appraisal outcome generally determines the next steps of an employee's journey at the business. This may be:

• discussing the performance rating or other appraisal outcome (eg suitability for promotion) - this helps the manager highlight rewards for good performers and can give an indication of where (and why) poor performers aren’t achieving so highly

• filling in competency gaps - this will highlight areas where the employee can develop further skills that can help them grow in their role and allows both parties to discuss future objectives 

• identifying potential growth opportunities - the employee may wish to work in other areas of the business that they are interested in and the appraisal sets out what steps they need to take to reach that goal of theirs

Following the outcome of an appraisal, employees may disagree with the manager’s comments and/or the result of their appraisal. If this is the case, the employee should follow their employer’s appeals process or other mechanisms in place to address and record their concerns. The employee may, for example: 

• make a request to the manager to submit a rebuttal or a reply

• escalate their concerns to a higher level (eg HR department or senior management) and express why they disagree with the appraisal outcome

• ask for a follow-up meeting with their line manager to discuss and address their concerns. If HR is involved then they may be present during the meeting

Employers should be open to receiving rebuttals from an employee as this shows a good indication that the company is willing to take on feedback. 

If an employee disputes some smaller issues in their evaluation but is otherwise satisfied with the appraisal, the employer may wish to make and keep records of the disputed areas.

It is important to bear in mind that employee appraisals do not form part of a disciplinary process and should not be used by your employer to impose disciplinary sanctions. Rather, employee evaluations should be an open forum allowing the employee and their line manager to talk about performance at work. However, issues relating to the employee’s performance may at times be dealt with by reference to past employee appraisals, if an employer starts an employee improvement process.