I handle consulting services to provide Performance Management System (PMS). The issue you have described is not new. It happens everywhere. Perceptual differences between a manager and their subordinates are common. Subordinates often nurse grievances against their manager for underrating. That is why when I design PMS, I do not leave room for "non-acceptance."
Now, at this stage, you have two options. The first one is to tell the junior firmly that the manager's rating is final, and no disputes will be entertained. However, this type of management style will only suppress the conflict and may not resolve it. Embers of discontent may extinguish temporarily, but they could flare up again. The other option is to understand why the junior is refusing to accept the rating given by the manager. Could you identify the points of agreement and disagreement? Regarding the disagreement, is there evidence with either party? Let your General Manager (GM) call both parties and sort out the issue.
Cleft Stick
The issue has caught you in a cleft stick. Whichever side your GM gives the verdict, the other party could feel let down. Possibly, the authoritarianism of the GM may not bring it to the fore, and your organization may create a facade of harmony. Nevertheless, it remains to be seen how long it lasts.
Learning from the Incident
The incident teaches all HR professionals in general, and you in particular, the importance of measurement in Performance Appraisal (PA). Subjectivity fosters vagueness; therefore, you should determine if the PA is based on any vague parameters. Secondly, our job is not to resolve the PA conflict between managers and subordinates but to take steps to prevent it. The incident could set a trend, and in the following years, there could be more objections. Therefore, to avoid the recurrence of such incidents, you may need to institute a robust PMS designed by an external consultant. Feel free to call me for further discussion.
Thanks,
Dinesh Divekar