Performance Appraisal Systems Are Perceived as Unfair
There can be myriad reasons why performance appraisal systems exist in an organization. They help to facilitate pay increases and to form the basis for coaching the low-performing employees, among other functions. Many organizations—such as Adobe and Juniper—have initiated or even completed the total revamp of their performance appraisal systems by doing away with the traditional rating system and bringing in newer ways of approaching appraisals.
The traditional rating and rewarding system is often seen to have many drawbacks. Some of the shortcomings include manager's having too much stake in deciding ratings and the problems specific to bell-curve fitment. Holistically thinking, every system to appraise human beings will have one problem or the other.
One of the most common complaints employees have regarding performance appraisal systems is the perception of fairness. Perception is the reality of how the observer’s eye sees you and your actions.
To relate further, the extent of preciseness with which management communicates its decisions forms a certain image in the eyes of employees, and that image is known as perception. Managing perception is one of the most underrated concepts in business communication, and this could be further ascertained with the experimental case of workplace smoking and its impact on perceived fairness.
The importance employees give to perception of fairness can be understood well from the equity theory of motivation. It states that “The concept of equality is very subjective and can differ from one person to another. One way of determining what is 'equal' is through comparing similar situations.”
So if an employee thinks he has put forth enough effort and demonstrated similar results as the top-ranked person on his team, he expects the same rewards. If he doesn't get the same rewards, he starts perceiving the appraisal system as unfair.
This notion is further substantiated by the principle of organizational justice, which says “Fairness is often of central interest to organizations because the implications of perceptions of injustice can impact job attitudes and behaviours at work. Justice in organizations can include issues related to perceptions of fair pay, equal opportunities for promotion, and personnel selection procedures.”
Thus, the role of management doesn’t end with defining the appraisal process and conducting the same accurately. It has a crucial responsibility of aligning the communication in a way that it is accepted as fair by a larger audience. The ethos aspect of Aristotle's three elements of communication explains the importance of credibility in any communication.
If done right, performance appraisals serve one of the basic human needs, and that need is getting acknowledged for effort from other human beings. The unfairly perceived system robs an employee of this basic need.
Do you communicate well enough to be perceived as fair?
