When should I talk about the pay increase?
Ideally, the discussion about compensation and the discussion about performance should be separate talks. If it's possible, the performance appraisal meeting should focus entirely on the individual's performance with discussion of compensation reserved until a later time. However, if performance and compensation must be discussed in the same meeting, begin with the compensation change. Then talk about the performance appraisal.
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In an effective performance management system, the individual's performance appraisal rating is only one of several determinants of the compensation change. Therefore it makes sense to concentrate entirely on performance during the performance appraisal discussion and wait until a later meeting to discuss Sam's pay increase. The way to handle this is to say, "Sam, as you know, the quality of a person's performance is one of the most important factors that the company takes into account in determining compensation. There are other factors, too. That's why I want to focus our discussion today entirely on your performance over the last twelve months and save our discussion about any pay increase until early next month."
In many organizations, however, it is customary to let the person know about a pay change in the same meeting that the appraisal is discussed. In this case, be sure to cover the pay change at the start of the meeting so you can get it out of the way. Say, "Sam, before we discuss your performance appraisal, I'm pleased to let you know that effective with your next paycheck you'll be receiving a 3.8 percent salary increase. Now let's discuss how you did over the past twelve months."
If you wait until the end of the performance appraisal discussion to reveal the amount of the increase, all of your words about the quality of Sam's performance will be drowned out by the little voice inside Sam's head that continually whispers, "How much . . . how much . . . how much?"
How do I bring the performance appraisal discussion to a successful close?
Here are the steps to wrap up a performance appraisal discussion effectively:
- Briefly summarize the entire conversation (review your core message).
- Discuss two or three areas of strength to be continued and enhanced.
- Review the most important area for immediate improvement.
- Explain the most important developmental need.
- Handle administrative mechanics.
- Schedule planning meeting.
- Congratulate (offer statement of hope) and close.
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After about forty-five minutes or so, both parties will start to realize that the major objectives of the performance appraisal discussion have been met and that it's time to start wrapping things up. Here's a script that will work in bringing the performance review meeting to a successful conclusion:
Now that we've reviewed the complete appraisal, Mary, let's summarize the key points we've discussed. The most important thing I want you to remember about our discussion is . . . [Make a clear statement of the core message that you determined in preparing the individual's appraisal.]
In reviewing the entire appraisal, there are two areas in which I think your performance has been outstanding. . . . [Describe two specific areas of strength that should be continued and enhanced in the upcoming year.
There is also one area in particular that you need to immediately work on improving. That area is . . . [Describe the single most important weakness or improvement need in the employee's performance and explain why improvement is necessary.]
Finally, when you think about your development plans for next year, the one area I'd like you to give some serious thought to is . . . [Discuss most important developmental need for the next year.]
That pretty well sums it up for me, Mary. Are there any other questions I can answer for you? [Answer any employee questions.]
As a final matter, it's our policy to ask you to sign the performance appraisal to indicate that you've had a chance to read and understand it. If you'd like to add any comments, feel free to do so. [Give appraisal to employee to sign and cover any other administrative requirements.]
This session has been extremely valuable to me, Mary, and I'm sure it has been for you, too. I'll look forward to discussing plans for next year on ... [ Set a date for a performance planning meeting to discuss next year's accountabilities and development plans.]
There's no formal requirement that you identify two strengths and one problem and one development need. It does make the job manageable, however, and it also gives the individual a reasonable number of things to remember from the conversation. If the employee can walk away having clearly heard the core message and remember just a few strengths and needs for change, you've done a fine job.
It's appropriate to close the meeting on a positive note, even if the performance appraisal rating was unacceptable and the core message was that immediate improvement is required or termination will follow swiftly. Even in a case such as this, it's a good idea to end the meeting with a statement of hope that the problems will be corrected and the individual will return to the fold of good, solid performers.
Most companies' performance appraisal procedures ask for the employee to sign a copy of the form to acknowledge that the person being reviewed has had a chance to review the form and discuss it with the supervisor. Most also provide a section for the individual to add comments to the form. Both of these are good ideas.
There is no reason that the employee should have to write her comments on the performance appraisal in the meeting with the manager sitting right there. Allow the individual some timea couple of hours, a day or twoto think through her reactions and write the statement on the appraisal form.
What's the best way to deal with an employee who refuses to sign the performance appraisal document and refuses to provide his own comments?
It's unusual for someone to refuse to sign the form and refuse to put any comments in the section earmarked for them.
Start by asking why, and explain the purpose for the signature: "I'm surprised, George, that you are refusing to sign the form and also refusing to indicate any reason in the space set aside for your comments. As I explained, the purpose of asking for your signature is not to indicate that you agree with what I have written, but simply to show that you have seen this document and that you and I have talked about your performance. We have just done that, and I'd like you to acknowledge it. Can you tell me why you don't want to sign the form?"
If George offers no meaningful reason and continues to refuse, it's appropriate to remind him that the decision not to sign and not to put down any comments, like all of the other decisions one makes in life, will have consequences. "Frankly, George, I'm disappointed in your decision. You know that your performance is not acceptable and your refusal to follow a standard company policy only makes things worse. It's difficult for me to justify your being a member of our team if you refuse to follow reasonable company expectations."
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Dealing with employees like this one is frustrating. One manager wrote:
Shouldn't every employer have as a policy that an employee's failure to sign and accept his/her review is unacceptable and can be grounds for termination? The employee can write his/her own comments on the form and express disagreement, but at the end of the day, it seems to me they need to accept the manager's assessment, move on, and work on the areas that need improvement. If there isn't a willingness to do that, isn't it just a waste of time to continue the employment relationship? One could probably go through the motions over the next six to twelve months and eventually fire the person for poor performance, but why drag it out that long when it's apparent the person just doesn't get it?
While it might be nice to consider George's refusal to sign the appraisal form as an act of insubordination and process the paperwork for his termination, it's not a wise move. Failing to sign an appraisal form is usually not considered a "culminating incident," and if George challenges his termination, he's likely to prevail. It's better to realize that you have a marginal and obstreperous employee on your hands and wait until the next incident of poor quality or quantity of work provides a genuine cause for termination.