Performance Review
A performance review is a formal assessment of an employees work performance, typically conducted annually or periodically, covering achievements, development, and future objectives.
processes
Category
beginner
Difficulty
5 min read
Read time
2025-01-15
Updated
Definition
Short definition
A performance review is a formal assessment of an employees work performance, typically conducted annually or periodically, covering achievements, development, and future objectives.
Detailed explanation
A performance review (or appraisal) is a structured evaluation of an employees job performance and contribution. Traditional annual reviews are being supplemented or replaced by continuous feedback models.
Components typically include review of objectives and achievements, assessment against competencies or values, development discussion, career conversation, and setting future goals.
Modern approaches emphasize ongoing feedback, frequent check-ins, and forward-looking development over annual backward-looking rating.
Practical guidance
How it works
Set objectives at period start. Track progress. Conduct review meeting. Rate performance. Discuss development. Set new objectives. Document and follow up.
Best practices
Set SMART objectives
Provide ongoing feedback
Allow self-assessment
Focus on development
Document discussions
Legal context
Legal basis
Company policy (not statutory requirement)
Jurisdiction: Global
Key provisions
Must not discriminate in ratings
Should be fair and consistent
Decisions should be documented
Employees should have opportunity to respond
Official source
Frequently asked questions
How often should performance reviews happen?
Traditional annual reviews are increasingly supplemented by quarterly or monthly check-ins. Best practice is continuous feedback with periodic formal reviews for documentation and development planning.
Should performance ratings be linked to pay?
This is a business decision. Linking can motivate but may also cause anxiety and gaming. Many organizations are decoupling performance ratings from pay, or moving to less granular rating scales.