Performance Evaluations

Have any of you ever worked for a company that has done away with performance evaluations? Evidently, there is a school of thought that performance evaluations are counterproductive, a waste of time and create an adversarial relationship between the employee and the employer. Both supervisors and employees hate them and are really only interested in the amount of the raise they are going to get. I have found that employees focus on a number more so than the content of the feedback they get on the evaluations. No one wants to consider themselves a Level 3 employee, which, according to our specifications means an employee who is fully functioning in their position. This would be where the majority of the employees would fall. No matter how much education, etc. that we have given employees they still feel a Level 3 is an "average" person.

I am really ready to consider the "no more performance evaluation" method. Everyone would get the same rate of increase and special incentive pay would be given to employees who have demonstrated they have gone over and above what is normally expected. (Serving on committees, helping with different projects, coming up with money saving ideas, etc.).

Any suggestions or experience you could share would be appreciated.
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