Course Code and Title: HRME5 – Compensation Administration

Professor: Dave Kieth J. Lappay

Lesson Number: 15
Topic: Performance Appraisal (1)

Learning Objectives:

At the end of this lesson, the student should be able to:

1. define performance appraisal,
2. identify the effectiveness of employees on their present jobs so as to decide their benefits, and
3. explain employees’ potentials for promotion and advancement.

Pre-Assessment
Direction: Read the questions carefully. Provide the answers in the separate sheet of paper/s.

1. It is the systematic, periodic and an impartial rating of an employee’s excellence in the matters
pertaining to his present job and his potential for a better job.
2. – 4. What are the needs of performance evaluations?
5. Why should an employee be aware of the criteria of performance appraisal?

Lesson Presentation:

According to Edwin B. Flippo,

“Performance appraisal is the
systematic, periodic and an impartial
rating of an employee’s excellence in
the matters pertaining to his present job
and his potential for a better job.”

According to Scott, Clothier and

Spriegal, “Performance appraisal is a
record of progress for apprentices and
regular employees, as a guide in
making promotions, transfer or
demotions, as a guide in making lists for
bonus distribution, for seniority
consideration and for rates of pay, as
an instrument for discovering hidden
genius, and as a source of information
that makes conferences with
employees helpful.”

• Document employee performance.

• Document corrective action necessary to

improve work performance.

• It is the supervisors’ and managers’

responsibility to monitor, evaluate and coach
employees.
Purposes and Aims of Performance Appraisal:

• Performance appraisal helps the management to take decision about the salary increase of an employee.
• The continuous evaluation of an employee helps in improving the quality of an employee in job
performance.
• The performance appraisal brings out the facilities available to an employee, when the management is
prepared to provide adequate facilities for effective performance.
• Review the employees’ performance.
• Judge the gap between the actual and the desired performance.
• Give employee feedback.
• Identify employee training need.
• Document criteria.
• Form a basis for personnel: salary increases, promotions, disciplinary actions, bonuses, etc..
• Provide the opportunity for organizational diagnosis and development.
• Facilitate communication.
• Validate selection techniques and human resource policies.

1. Ranking Method is when an employee is ranked against the other in the working group under this method.

Advantages: Each employee be compared with the other person.

Useful in small organization.
Disadvantages: Cannot be used for big organization
Does not evaluate the individuality of an employee.
It lags objectivity
Generalization:

A performance appraisal is a regular review of an employee's job performance and overall contribution to a
company. Also known as an annual review, performance review or evaluation, or employee appraisal, a
performance appraisal evaluates an employee’s skills, achievements, and growth--or lack thereof. Companies
use performance appraisals to give employees big-picture feedback on their work and to justify pay increases
and bonuses, as well as termination decisions. They can be conducted at any given time but tend to be annual,
semi-annual, or quarterly.

Reinforcement:
Direction: Read the questions carefully. Provide the answers in the separate sheet of paper/s.

1. Compare and contrast the traditional and modern methods of performance appraisals.

References:

https://www.slideshare.net/MandeepGill1/performance-appraisal-57140068
https://www.investopedia.com/what-is-a-performance-appraisal-
4586834#:~:text=A%20performance%20appraisal%20is%20a,growth%2D%2Dor%20lack%20thereof.