How to Use Performance Ratings

This guide covers:

1. What are performance ratings?
2. Why are performance ratings important?
3. What are the performance rating definitions?
4. How are the overall performance ratings assigned?
5. When and how to communicate the overall performance rating?

1. What are performance ratings?

Performance ratings provide a way of concisely summarizing each employee’s performance for the previous year,
taking into account all of the factors that have played a part in the outcomes achieved i.e.,

▪ ‘What’ was achieved; these are typically deliverables and/or tasks (the employee was responsible for), and
▪ ‘How’ it was achieved; the expected behaviours and ways of working demonstrated.

This is why it’s important to agree on SMART objectives in line with the needs of the business and to record them
in Workday early in the new year - so that each employee knows what to achieve and how their contribution will be
assessed.

2. Why are performance ratings important?

Performance ratings are taken into account when determining annual salary increases and allocating
bonus payments, when applicable. They:

▪ Summarize the performance during the year.

▪ Provide a common language for discussing the contributions people have made.
▪ Differentiate how people have performed.
▪ Minimize subjectivity – focus on “what” and “how” results have actually been achieved.

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3. What are the performance rating definitions?

Rating Description Distribution

Does not meet Does not meet role expectations and/or objectives (focusing both on “what”was
expectations done and “how” it was achieved). Immediate improvements required along with 0 - 5%
a formal performance improvement plan.
Partially meets Partially meets role expectations and/or objectives (focusing both on “what” was
expectations done and “how” it was achieved). Some improvements are required along with 5%
further support and development
Fully meets Delivers consistently good performance by achieving all role expectations
expectations and objectives (focusing both ‘what’ was done and ‘how’ it was achieved). 65% - 70%
Works hard to deliver results on a consistent basis.
Exceeds Over-achieves by surpassing role expectations and objectives (focusing both on
expectations “what” was done and “how” it was achieved). Recognized as someone who 15% - 20%
makes an exceptional contribution to the organization.
Outstanding Very significantly exceeds all role expectations and objectives (focusing both on
“what” was done and “how” it was achieved) and has made a significant impact
in the organization. Recognized as someone who makes an absolutely 5%
outstanding contribution with our clients or for the greater good of the
organization. Is a role model for others to follow.

4. How are the overall performance ratings assigned?

Managers are assessing the performance of each team member, first by getting familiar with the performance
ratings definitions and guideline distribution (see above), then weighing up all the considerations to select the most
appropriate performance rating. The following should be considered:

▪ The employee’s self-evaluation comments

▪ Feedback received or requested on employee over the course of the year
▪ What has been achieved and how, taking into account any changes in priorities over the course of the year
▪ Unconscious bias or any factors that could unduly influence the rating - the document “What do I need to know
about unconscious bias?” provides more guidance on recognizing and preventing unconscious bias
▪ Realistic assessment of performance and the behaviours demonstrated

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Making judgements about performance rating is not always easy; here are potential pitfalls:

The 'Recency'
The 'Halo' Effect The 'Horn's Effect The 'Crony'Effect The 'Veblen'Effect
Effect
Where one Where one Where the Where there is a Ignoring
characteristic of characteristic of reviewer and the tendency to mark outcomes at the
an employee an employee employee are all employees in beginning or
colours the colours the such good friends the mid-range to middle of the
judgement and judgement and that the avoid difficult evaluation period
makes it more makes it more performance decisions and instead
likely that it will likely that it will review is unfair focusing on the
be favourable be unfavourable most recent
memories

Managers should consider

▪ Differentiate: compare achievements across the extended peer group (i.e., beyond the employee’s
immediate team) and make sure your performance ratings accurately reflect the different contribution
thateach employee has made.
▪ Consistency: compare the achievements to make sure performance ratings reflect similar levels
ofcontribution.
▪ Discuss the whole period and range of activities the employee is responsible for; get all the information;
avoid over generalizing.
▪ Get and review feedback from multiple sources to get a complete picture of what has or has not been
accomplished.
▪ Seek examples and evidence of what has been achieved.
▪ Find out what factors have affected performance, both inside and outside the individual’s control.
▪ Discuss and agree what aspects of work require improvement and how this could be achieved.

A ratings review will be carried out during December. In essence this is a form of high-level moderation, carried out
by senior leaders, working closely with Human Resources. The aim is to ensure consistency, parity and fairness in
the ratings assigned. It’s also a way to ensure we differentiate between employees who fully meet expectations
and those who stand out from the crowd.

5. When and how to communicate the overall performance rating?

As part of the annual performance conversation held in January:

▪ Managers confirm the overall performance rating and explain why. It’s important to reinforce the fact that Fully
meets expectations is a very good rating and is already quite an achievement.
▪ Managers and employees discuss and agree on any actions to develop or improve and/or sustain performance.
▪ Managers and employees discuss objectives for the next 12 months.

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