Employers that carry out pay audits of their performance appraisal systems
can save money while ensuring the principles of equal pay are at the heart of
their initiatives.
The starting point for pay-related audit of a performance appraisal scheme can
easily be ‘is it gender neutral?’ It is so easy to establish attributes for
measurement , development and promotion that have a particularly masculine
bias.
Among the issues around audit for performance appraisal are:
– Has the scheme been developed with a degree of consensus (certainly from
the appraisers – and possibly also from the appraisees)? If not, the scheme is
unlikely to have an effective life of more than two to three years
– Is the scheme part of everyday management – with regular/constant feedback
and communication on performance issues? Or is it an artificial/annual or six
monthly ‘event’?
– Are the ratings (assessment levels), their definition and scoring
realistic and easily understood and applied?
There is a school of thought that says it would be most impractical to have
a system that differentiated at more than three levels of performance. These
could be:
– Outstanding (better than ‘the norm’ expected in the job)
– Sound performance (completing the job to the expected standard)
– Development necessary (for those who fall short of the defined standard)
Such distinctions should be considered from a ‘potential for discrimination’
perspective.
The audit can then go onto check the links of pay to performance (or
achievement) in an analytical manner.
– Are the relative awards for each defined level of performance the same? If
not, are there justifiable reasons?
– Is there a gender gap in either performance ratings or in pay attaching to
them?
Sign up to our weekly round-up of HR news and guidance
Receive the Personnel Today Direct e-newsletter every Wednesday
– Are there any areas in the organisation where performance pay seems more
easily attainable then elsewhere?
Derek Burn is director consulting, DLA-MCG
