separating increases from performance review

6015231

Currently we give increases at time of review at anniversary - we want to give raises to everyone on Feb 1 and schedule performance reviews at another time. Question: we still contend this is a merit raise - how do I communicate to the supervisors that I want them to rank their employees in a bell-curve fashion? I would appreciate any suggestions.

Thank you.

TXHRGuy

You can use a forced ranking...

 What does the performance appraisal/review being separate from the merit raise have to do with the method of assessing relative merit?

HR in TX

We don't want this to become a cost of living raise, but we won't have a review attached to it.  Raises will probably be lower than usual this year, but we want to recognize those that go far above and beyond.  Maybe my better question would be, 'how do I assess relative merit?' 

TXHRGuy

[quote user="HR in TX"]We don't want this to become a cost of living raise, but we won't have a review attached to it.  Raises will probably be lower than usual this year, but we want to recognize those that go far above and beyond.  Maybe my better question would be, 'how do I assess relative merit?' [/quote]

It seems to me that the very idea you have doesn't work as stated.  On one hand, you want to have increases that aren't tied to merit.  On the other hand, you want increases not to be considered a cost of living adjustment and still reward some employees based on "relative merit".  Either the raises are merit raises or they are not merit raises, regardless of when the performance appraisal occurs.

If, underneath all this, what's really going on is that the company doesn't have enough money to pass out raises as usual and so you want to give serious rewards to serious contributors and nobody else, you can still do that on a merit basis.  As the famous line goes, "First prize is a Cadillac.  Second prize?  A set of steak knives.  Third prize?  You're fired."  That, of course, is from a comedy but the point resonates.  If you want a place where second place is the same as first loser, you can still do that on a merit basis.

Why is there a concern about decoupling performance appraisals from raises?  Normally, HR's concern is the other way around.

HR in TX

Thank you for your comments - this is obviously not my area of expertise.  We're going about this backwards because we want to get the money out of the way, so that we can concentrate on a better performance management process this year.  Since we're switching from an anniversary raise, those with January reviews will be/are looking for their raises.  This is a one-time shift as we move all raises to a Feb 1 date.  Last year's reviews are so distorted (with all employees rated a 4-5 on a 5 point scale); it's impossible to use those for our purposes.  Short of ideas, I've asked all supervisors to rank their employees 1-2-3, giving me examples for the 1's and 3's.  I've given them guidelines, but I know they will struggle with this, so I'm still looking for other ways to better guide them.  Although both I and these concepts are new to the organization, and while perf mgmt and supervisory training are both at the top of my agenda this year, I've got a deadline to meet.  Most importantly, I want to make sure we do this right.  

TXHRGuy

Keep it simple.

I would do the following two things if I were in your shoes.

1. Merit pay changes will occur for all employees on Feb 1.  Performance appraisals will be conducted in January.  Period.  Say it like it's not a big deal and it won't be a big deal.
2. Use a 4 point scale.  Eliminate the middle.  Force everyone into a "pick the answer that best fits" and give them only sub-standard, needs to improve, above average, and exceptional.  That's called a forced-choice scale.  No middle ground.  Next, train supervisors to use the scale based on their employee group rather than based on their thoughts about applicant pools.  You can still get a "C" at MIT, even though you are among the brightest up-and-coming talents in an academic field.  If you have ways to compare ratings against objective data (papers processed, closing percentage, widgets assembled, DISCIPLINARY DOCUMENTS THAT ARE PROBABLY MAINTAINED BY HR), you might say that supervisor's own performance appraisals will take into account how the performance appraisals of their staff stack up against a spot check of objective data.