How Often Should Employee Appraisals Happen? Seeking Your Views on Yearly vs. Biannual Reviews

Frequency of Employee Appraisals

Appraisals depend on the performance of the employee, but I want your opinions on the number of appraisals in a year. Most often, companies have yearly appraisals for the salary of the employees, but I have also seen a few companies that offer appraisals twice a year. So, I just want to know your views on which is better and why?

Also, does it encourage employees to perform better if we offer an early appraisal after 6 months instead of doing it yearly, or could it help in decreasing the attrition rate for the company?

Regards,
Couvery

The number of appraisals depends on several factors. Leaving aside salary appraisals, which should be done once a year, the number of performance appraisals depends on the initial appraisal. If no improvements are required (very rare), then half-yearly appraisals are fine. However, if an appraisal requires improvement(s), then a time limit should be set depending on the required improvement. For example, if the improvement needed is accuracy in documentation, then a one-month time limit is acceptable before the next appraisal. If an improvement in Sales Targets is required, then three months is acceptable, and so on. It all depends on the improvement required and your or management's view on the time limit to be set. Therefore, there is no set number of appraisals.

I hope the above helps.

Regards,
Harsh

In theory, appraisals can be done anytime as the company or HR may see the need for it. However, appraisals and their mechanisms should be understood properly so they can be administered correctly. As we all know, appraisals are generally linked to certain personnel movements like regularization, promotion, bonuses, or dismissal. Hence, there is a need to prepare the tool, administer or coordinate its implementation, process or interpret its results, and announce its effect or impact to employees within certain specified timelines to meet top management's calendar for such events.

Factors Determining the Feasibility of Multiple Appraisals

Moreover, regardless of a company's need or desire, the following factors will determine the feasibility of multiple appraisals in a given year:

• The quantity of employees that a company has.
The more employees a company has, the more difficult it will be to implement multiple appraisals within a year. When a company has thousands (e.g., 5,000) employees, it will be nearly impossible to conduct more than one appraisal per year.

• The size of the HR Department.
There are companies whose HR Department is a "ONE MAN/WOMAN TEAM." If you are in this company, it will be impossible for you to conduct multiple appraisals in a given year—even if your company only has a few hundred (not thousands) employees. Indeed, only big companies with a huge HR Department can create a section or team that can focus exclusively on the preparation, implementation, and processing of appraisal results. They are the ones that can realistically conduct multiple appraisals in a given year.

Hope this helps.

Regards,
Ed Llarena, Jr.
Managing Partner
Emilla International Consulting Services
Tel: [Phone Number Removed For Privacy Reasons]

Normally, we can conduct performance appraisals twice a year. However, it is advisable that we closely link the appraisal to salary increments once a year. Conducting appraisals every six months may raise expectations from the employees' side. Therefore, yearly appraisals are recommended. Addressing any inequalities in the salary structure should be done during the annual appraisal, along with providing a clear career path for high performers. I believe that through this system, we can also effectively manage attrition. This is my opinion.

Regards,
R. Dhamodhara Kannan
Trichy

If your company (and HR) has the capability of implementing an appraisal twice (2X) per year, and you opt to do it once, it is your and/or the company's option/decision/discretion. However, the fear of "salary increase expectation" (associated with an appraisal) should never be a reason because HR can simply issue a memo clarifying the policy on salary increases (which is once a year) and the reasons for conducting a midterm appraisal.

Regularization and Employee Evaluation

What about the employees who are due for regularization? Are they not supposed to be evaluated to determine if they meet the minimum standards of the company for the job for which they were hired?

I know companies that implement appraisals twice per year because they believe that a "mid-term appraisal" (half year or 6 months) provides a good opportunity for review and assessment to determine early if employees are "on track" with their targets for the year. If on track, the employee will be encouraged to continue and/or move to achieve the milestone targets included in the performance plan; if not on track, the employee is made to undergo immediate improvement/corrective action so he/she will be able to achieve the agreed target by the end of the year.

But, indeed, it is your option/discretion!

Regards,
Ed Llarena, Jr.

Managing Partner

Emilla International Consulting Services