John Doe is a manager who attempts to be efficient at his job. He understands that personnel management requires a certain diplomacy and finesse. But when he speaks to in-house counsel Jane Smith about a recent EEOC charge filed against their company she is quick to give him several rigid rules to avoid the perilous pitfalls of performance appraisals:
If it’s bad, say so
A performance appraisal is immediately evidence in an employment law case. Thus, whenever, and I mean each and every time that a performance appraisal is being conducted, managers must give their honest assessment. If performance is bad, then managers must make that clear in writing during the appraisal. This writing should state the standard to be attained, should delineate how the employee has failed to meet the requisite standard and lastly, what the employee must do to cure the error.
For instance, during unemployment insurance benefit appeals before the Georgia Department of Labor, where misconduct is alleged, the evaluations if done properly could demonstrate that the employee was aware of the standard to be met, did not meet the standard, was given an opportunity to cure the deficiency and did not do so.
2. Don’t ignore a litigation hold notice
A litigation hold is a written directive advising custodians of certain documents and electronically-stored information (“ESI”) to preserve potentially relevant evidence in anticipation of future litigation. Performance appraisals are frequently relevant in wrongful termination cases, especially those cases in which the employer alleges poor performance as the non-discriminatory or non-retaliatory reason for termination of employment. These evaluations are thus frequently the subject of discovery requests. Medical records are another class of usually relevant documents especially in a disability discrimination case. Several types of documents fit the bill depending on the issues raised in the suit.
Once an employer receives notice of a potential legal claim, it does have a duty to preserve the relevant documents, failing to do so could trigger an adverse inference that the documents would have favored the employee. Also, sanctions could be levied against the employer and its legal counsel.
3. Educate managers to apply objective standards uniformly
Performance appraisals are generally governed by employer policies; there are no federal or state laws determining how or when a performance appraisal must be conducted. However, there are laws implicated by the manner in which employers carry out performance appraisals. For instance, Title VII of the Civil Rights Act of 1964 prohibits discrimination on the basis of race, national origin, sex, etc., the Age Discrimination in Employment Act prohibits discrimination on the basis of age, the Americans with Disabilities Act prohibits discrimination on the basis of a real or perceived disability. Each of these laws could be violated if the employer scores the employee negatively because of one or more of these protected categories.
All told, employers need good counsel to create performance appraisal templates, to educate supervisors and managers on its use and to maintain compliance in the event of a dispute.