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MMS-II, Sem. III (HR)
LEGAL AND ETHICAL PERSPECTIVES IN PERFORMANCE APPRAISAL
1. Legal Perspectives in Performance Appraisal:
It is important for a manager to realize that performance appraisal becomes a legal issue
whenever it is used as the basis for an employment decision, including promotions, pay
raises, selection for training programs, etc. Many laws exist to enforce the requirement that
the evaluation of work behavior be based on objective, job-related criteria so that an
individual’s employment situation is not unjustly affected because of the manager’s
stereotypes or biases. Following is the System Model of Performance Appraisal which shows
that the legal consideration is one of the most important aspects of Performance Appraisal
Systems Model of Performance Appraisal
A Systems Perspective of Performance Appraisal
Develop or Train Mgrs Record
Legal Select to Reduce Evaluate Conduct
Consideration Performance Rating Employees Interview
Evaluation of Performance
Following are some of the Legal Aspects of the Performance Appraisal System:
1. Performance appraisals should not be used in a merely punitive or retaliatory fashion.
It is grossly unprofessional for a manager or supervisor to use the appraisal process to
'get even' with an employee who has displeased or upset them in some way.
2. Appraisals should not be used to discriminate against employees on the basis of race,
religion, age, gender, disability, marital status, pregnancy, or sexual preference.
3. Performance appraisal results should be fair, accurate and supported by evidence and
examples. For instance, if an employee has poor interpersonal skills and is harming
morale and group performance, the supervisor might keep a log of incidents. Co-
workers may be interviewed and their views and reactions recorded. The nature and
effects of the employee's behaviour should be documented.
4. An employee should have the opportunity to comment on their appraisal result, to
express their agreement or otherwise, and to appeal the result or at least request a
review by up line supervisors.
5. Appraisals should be balanced, recording information on both the good and the bad
aspects of an employee's performance (as far as possible).
6. Appraisals results should not be used as the sole basis for promotion, remuneration or
termination decisions. A broad range of information should be considered, in which
the employee's appraisal results may be significant but not necessarily conclusive.
7. Employees who receive a poor performance appraisal result should be given a
reasonable chance to improve. Generally speaking, it is a bad idea to dismiss, demote
of otherwise penalize an employee because of a single adverse appraisal result
(depending of course on the nature and seriousness of the conduct that underlies the
8. Timely feedback should be provided, especially to marginal or poor performers. It is
not fair to offer zero feedback to a poor performer for twelve months and then present
them with a bad appraisal. More frequent feedback and guidance should be provided
to the Employees. A fair chance should be given to the Employees to correct the
problem in a timely manner.
9. Records should be retained. If an employee believes they have been dealt with
unfairly, they may have rights to instigate legal action years later. In the case of poor
performers, or persons dismissed or demoted, or those who resign or leave in less than
happy circumstances, their appraisal records, together with critical incident logs and
other relevant documents, be archived indefinitely.
10. If an appraisal result is poor (or in any way likely to be controversial or provocative),
an objective third party should be hired for their views on whether the appraisal result
seems fair and reasonable.
11. Appraisals should avoid inflammatory and emotive language. It should be of
detached and dispassionate style. The criticisms should relate to actual job
requirements and not based on mere personal or other irrelevant issues that have little
or no connection with actual job requirements.
12. Managers and supervisors required to conduct staff appraisals should be trained in
appraisal principles and techniques. Conducting performance appraisals is one of the
most demanding of all supervisory activities. It is a sensitive and sometimes
controversial task which, if mishandled, can cause serious damage to employee
relations and morale.
13. Appraisal results should be treated as private and confidential information. Record
storage should be secure and controlled. Only people with an approved need to know
should have access to an employee's performance appraisal information.
2. Ethical Perspective in Performance Appraisal System:
Performance Appraisal lends itself to ethical issues. Assessment of an individual’s
performance is based on observation and judgement. HR Managers are expected to observe
the performance (or understand the potentials) in order to judge its effectiveness. Yet, some
HR Managers assign performance appraisal based on unrelated factors (for example, the
employee is not loyal to the rator, or the ratee belongs to a different cast or religion).
Ethics should be the cornerstone of performance evaluation, and the overall objective of high
ethical performance reviews should be to provide an honest assessment of the performance
and mutually develop a plan to improve the ratee’s effectiveness.
Many managers talk about ethics but do not recognize or act upon ethical issues in their day-
to-day managerial responsibilities. Most ethical questions arise from people relationships
within the organization. Managers must realize that ethics is the process of deciding and
acting. Recent survey results in one large organization indicate that only 26% of managers
believe they are recognized and reinforced for their ethical decisions and behaviors.
Employees have a big stake in the way managers evaluate and operate. Managers and
nonsupervisory employees alike cite concern about "politics and lack of fair treatment,
honesty, and truthfulness" in connection with the performance review.
Experience has clearly indicated that the handling of performance review sessions is usually
far more critical than the decision made or information conveyed in the session. Frequently,
when unsuccessful candidates for promotions are notified of the decision that someone else
has been selected they are not told why. Often they are not told anything, usually because the
managers or supervisors do not feel equipped or skillful enough to explain the reasons in a
systematic and rational way.
Sometimes, major miscommunications occur in performance review sessions due to basic
differences in ethical orientation. For example, the reviewer may say, "That report is a
requirement, and we need to follow the rules of the organization." The person being reviewed
may reply, "I make a significant contribution to this organization, and I don't have time to
prepare reports that no one looks at. Judge me on what I accomplish." What is going on here?
The reviewer is concerned with decisions and actions that conform to basic principles and
rules (adherence). The employee appears to be oriented toward the outcome - the ends justify
the means (results). They are talking on two different, nonconnecting planes. Unless the
employee and the reviewer are successful in negotiating an ethical balance, each may view
the other as taking unfair shots - and the battleground will be the performance review process.
Bibliography And Webliography:
1. Archer North & Associates
2. Human Resource And Personnel Management – By K Ashwathappa,
Publication: Tata McGraw Hill.
3. The ethics of performance appraisal - By Axline, Larry L.
Publication: SAM Advanced Management Journal.