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The performance appraisal
provides a means for discussing, planning and reviewing the performance of each
Regular performance appraisals:
•Help employees clearly define and understand their
•Provide criteria by which employees’ performance will be
•Suggest ways in which employees can improve performance.
•Identify employees with potential for advancement within [Company
•Help managers distribute and achieve departmental goals.
•Provide a fair basis for awarding compensation based on merit.
influence salaries, promotions and transfers. Therefore, it is critical that
supervisors be objective in conducting performance reviews and in assigning
overall performance ratings.
All full- and part-time regular
employees are eligible for an annual performance review and consideration for a
merit pay increase.
Performance review schedule
Performance appraisals, with
the exception of pay-for-skills-program participants (production assembly) and
sales staff on a commission plan, are conducted on an annual focal cycle. Employees
will receive a performance review on the established focal date each year.
Merit increases are not guaranteed and are based on company performance and
financials. When provided, a merit increase may accompany a performance review
if the employee’s performance and salary level so warrant. The amount of
increase should be consistent with the approved merit budget.
Focal increase planning
Overall merit budget
allocations and individual merit increases are planned for and allocated prior
to the start of each calendar year. The focal salary increase program is
designed to assist [Company Name] management in planning and allocating merit
and promotional increases that:
•Reward individual performance.
•Are market competitive.
•Are internally equitable.
•Are comparable with [Company Name]’s operating budget.
•Are equitably allocated among individual employees, taking into
consideration all available factors at one point in time.
Performance reviews—salary increases
Each [Company Name] manager is
responsible for the timely and equitable assessment of the performance and
contribution of subordinate employees. A performance review does not always
result in an automatic salary increase. The employee’s overall performance and
salary level relative to position responsibilities must be evaluated to
determine whether a salary increase is warranted. Out-of-cycle salary increases
must be pre-approved by the department manager, human resource (HR) director
and [Company Name] president.
Salary equity reviews
A manager may request an
analysis of an employee’s salary at any time the manager deems appropriate.
This request should be made to the HR director, who will review the employee’s
salary in comparison to other employees in comparable positions.
The forms and spreadsheets
provided by HR will be used, and the completed evaluation will be retained in
the employee’s personnel file.
The performance evaluation will
be discussed and signed by both the employee and the manager to ensure that all
strengths, areas for improvement and job goals for the next review period are
The manager is responsible for
completing the focal salary increase planning worksheet, obtaining focal
increase approvals and submitting the approved and final worksheet to HR for processing.
Salary increases must be
supported by a performance appraisal for salary change processing. The manager
will not discuss any proposed action with the employee until all written
approvals are obtained.
HR will review all salary
increase/adjustment requests to ensure compliance with company policy and that
they fall within the provided guidelines.
Right to modify policy
The HR director has the right to
change, modify or approve exceptions to this policy at any time with or without
This material is for informational purposes only and not for the
purpose of providing legal advice. You should always contact your attorney to
determine if this information, and your interpretation of it, is appropriate to
your particular situation.
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