Overcoming Bias in Performance Appraisals

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Performance appraisals are deeply important – and if you disagree we would recommend reading up on why we believe this. Holding regular performance reviews allows an open flow of feedback and constructive evaluation, which can be a significant building block to creating positive workplace relationships. the assessment of what goals and work is being set for different team members, and the collection of valuable data.

However, all of this may as well be dust if bias is playing a role in your performance reviews. Bias can lead to unfairly negative feedback being given by managers to employees, and similarly employees having a negative impression of their leadership. This will inevitably be detrimental to their employee engagement, satisfaction, and retention.

The feedback received in a performance appraisal can influence an employee’s perception not only of the individual holding their appraisal, but also of your company as a whole. While it’s often thought of as a time that an employee is given an evaluation of their performance at work, it’s also often an opportunity employees embrace to offer their thoughts and feedback. 

Bias can leak into performance reviews in so many ways. We evaluate five of the ways and offer practical solutions below:

Distance / Recency bias: 

Distance bias or recency bias refers to how we’re most likely to value what is closest to us, in terms of both space and time. This cognitive bias can cause us to evaluate situations and people unfairly because it feels more significant, both in its effects on us as well as our actual memory of it.

This would occur in performance reviews in the form of managers focusing their feedback more on the recent achievements and shortcomings of the employee at work, and less on what they accomplished in the earlier part of their review period.  

This can be unfair on the employee as it means they won’t be accurately evaluated on the entirety of their review period. If someone has a rough patch in the If someone has a rough patch in the month or two leading up to their performance review, then is more likely to be the overwhelming topic of conversation and focus, instead of the good work they provided before then. 

The Solution to Distance / Recency Bias:

Having regular one to one conversations between managers and their team members allows them to document their progress more regularly, so the good stuff is more likely to be noted and remembered, prevent biased views, and any slip in employee wellbeing, engagement or productivity will be noticed more quickly. To make this method optimally effective for your performance management strategies is ensuring your managers are in the habit of keeping notes of their one-to-one conversations, so there is evidence to remind them of each team members performance.

For more ideas on how to track employee performance check out our other blog post.

It’s also worth considering introducing a weekly or bi-monthly Q&A for your employees to fill out. They can be short and take only minutes to fill in, but they will make it certain that you’ll have data for tracking how your employees are feeling at work, what they might feel proud of or like they are struggling with. It can also help inform your methods of performance management.


Horn Effect / Halo Effect: 

The Halo / Horn Effect refers to a kind of cognitive bias where a single good or bad trait overshadows all others. An example of the Halo / Horn Effect is someone may be very good at selling a product but terrible at their admin, or someone could be very organised and meet every deadline but be quite introverted and choose not to socialise with their team when it’s not necessary to their work.

One of the glaring issues with the Halo / Horn Effect is it’s also very subjective what people would view and the overwhelmingly good or bad trait in someone. It will also be dependent on your workplace culture. If you strive to create a workplace culture which is fun, open, and extroverted then a person may be seen to have ‘horns’ for being introverted, when in reality they are not hurting anyone, and if they are productive and engaged then those should be the top priorities.

One of the greatest consequences of this kind of cognitive bias and when it comes into play with performance management is its effects on employee mental health and satisfaction. If an employee feels singled out during their performance review for a trait which does not actually cause any real issues for their team or company but they are still suffering for it, you risk losing them to another company as it’s unlikely they’ll want to stick around for long.

Simultaneously, if an employee has some ‘horns’ which does cause grief for other members of their team or beyond, whether it’s simply their lazy admin or real bullying behaviour, it will be the other employees who notice this bias and become disgruntled, unengaged and who could leave with a very poor impression of your company if the behaviour is left unchecked.

The Solution to Halo / Horn Effect:

Ensure training is offered to all employees, especially managers and leaders, around the importance of inclusion and diversity. Completing this training and implementing it should be an expectation.

 Have your HR team keep in consistent contact with all employees, whether through online satisfaction quizzes, one to one conversations or shadowing managers in the performance reviews to ensure any concerns raised for their own treatment or the treatment of other employees is taken seriously.

Building a strong and positive relationship with employees is key, as many may not feel comfortable raising such grievances in their performance reviews – especially if it is their manager they believe to be biased. Make sure employees feel safe and comfortable coming to you regarding any concerns.


Similarity Bias:

Research by Namely found that 84% of white employees had managers of the same ethnicity, compared to 34% of Asian employees, 25% of Hispanic employees, and just  24% of Black employees. It is not illogical to draw from these statistics that people of colour will be more likely to struggle to relate to their manager, and vice versa.

The consequences of this in terms of a performance appraisal and overall performance management may be that managers do not fully understand, sympathise, or even pick up on issues and obstacles members of their team might encounter. This will lead to the feedback they offer being uninformed, with an unrealistic expectation or a perception of various issues being clouded. This could be particularly true with more subtle situations, such as microaggressions. But just because they might be more difficult it notice, this not in anyway mean that are less significant or do not need addressing.

The Solution to Similarity Bias:

Ensure your DE&I training is regularly updated and revised and given to employees as refreshers regularly. This is particularly the case for managers who will be conducting the performance reviews, but also for all employees, so they are aware of what they should expect from their performance reviews.

Being brutally honest with yourself about the culture which exists in your workplace and how it can be improved. No culture is perfect, but a failure to make sure everyone is embraced and included is a major red flag – take complaints of any such behaviour seriously. Creating a culture which prioritises cultural adds over cultural fits, learning from others, and having open communication about where you need to improve.

Technology can be a game-changing tool in boosting diversity and inclusion in the work place. Learn more about it here.


Confirmation Bias:

This is a subconscious bias where people look for and focus on information that confirms their pre-existing beliefs, and ignores any information that would go against it. This can manifest into many different kinds of consequences. If a manager has a very negative first impression of someone, then whether this was justified or not, no matter how well that employee goes on to perform and improve it will still be given a negative assessment by that manager.

This can get even uglier if a manager has a negative bias of a certain minority group. A performance appraisal should be an objective evaluation of employee performance, but if you have a manager who holds misogynistic views for example, then they will inevitably give a more scathing assessment of their performance – and then be more likely to dismiss and ignore any feedback of this issue from these women!

The Solution to Confirmation Bias:

This is where performance management software comes in, helping managers and HR teams to keep track of employees’ contributions all year round, helping them be recognised.

While it may be managers who take care of performance appraisals, there’s no reason others can’t chip in to improve the quality of an employee’s performance management. Create a company culture where recognition for a job well done is given publicly and openly between employees. It’s even better if you can ensure these are given in a way that allows you to keep record of them, such as with an employee recognition software.

Encourage managers to have visibility of this feedback to challenge and pre-conceived negative bias. Creating this open culture will also help if the bias is positive. If people feel comfortable offering constructive feedback, as well as safe to escalate it to HR if necessary, then this minimises the risk of anyone continuing with unchecked poor behaviour.