Performance Reviews: Mistakes Managers Make
It’s that time again; the end of the year performance review that’s dreaded by managers and employees alike. In fact, one of the biggest business books this year was “Get Rid of the Performance Review,” by UCLA professor Samuel Culbert.
But most companies continue to conduct employee reviews. Here are some basic mistakes that can result in expensive losses for business owners:
#1: Inflating the grade.
Too often, managers give satisfactory or higher ratings for poor performance. This avoids the rater's having to confront the employee with a poor rating, and allows a raise to be given. This act may seem harmless at the time, however it will come back to haunt the company.
Ultimately, the employee will be fired for poor performance. When he or she (and a lawyer) point to the "satisfactory" or "good" rating, your "poor behavior" reason for firing goes down the drain. Whoops. Now a discrimination charge has traction.
#2: Job Descriptions Are Incomplete, Inaccurate, or Out-of-Date
Are you wondering what a job description has to do with a Performance Review? Quite a lot, actually.
This could easily be mistake number one. So much flows from the job description—duties, goals, appraisals, and compensation, for example—that it's critical to keep them current.
If you don't, once again, you're going to get killed in court. You'll say you fired the person for reason x, but the job description will not mention x as a duty. Now you've got the challenge of showing that items that weren't even important enough to make it on the job description were important enough to fire the person over. Not an easy sell.
#3: No Performance Management System
In smaller companies especially, performance management is often a casual thing. Once again, this is a morale disaster and an invitation to a discrimination lawsuit. In these "tap-on-the-shoulder" workplaces, where out of the blue someone gets a promotion or raise, all the other employees are thinking, That should have been my promotion. Why didn't I get it? I didn't get it because I am [a member of a protected class].
And when you go to defend that lawsuit, you've got little to show. You can't show that others were treated the same way, or that the decision was fair.
#4: No Goals or Vague Goals
Sometimes the appraisal system seems to be working, but the appraisals are relatively meaningless because the parties didn't pay enough attention to goal setting back at the beginning of the period.
With no established goals, or with goals that are vague, how could one tell whether an employee's accomplishments during the period were outstanding or poor?
Goals should be measurable and reasonable. They should be agreed to by the appraiser and the appraisee. And there should be a system in place to modify goals if there are significant changes in the work.
Employer Wins Big, Union Loses in Constitutional Picketing Case
On July 19, 2010, the 3rd District Court of Appeal issued a pro-employer ruling by holding as unconstitutional two state laws that have made it almost impossible for businesses to get a court to enjoin union picketing. The case is a big win for private employers, but the case will likely head to the California Supreme Court.
The 3rd District Court of Appeal held that property owners can stop unions from picketing on their property.
The court held that the statute is unconstitutional because the “act favors speech related to labor disputes over speech related to other matters, based on the content of the speech.”
"Stray Remarks" Can be Used as Discrimination Evidence
The California Supreme Court ruled on August 5, 2010, that "stray remarks" not related to an adverse employment against an individual may be relevant evidence of discrimination. The recent decision strays from the position taken by federal courts and makes it easier for California employees to provide evidence of discrimination in court. This particular case involved age discrimination allegations.
California Supreme Court Gives Employers a Win on Tip Pooling
In an important win for employers, the California Supreme Court ruled that Labor Code section 351, which makes it illegal for an employer to take gratuities that customers leave for employees, does not allow an employee to sue his or her employer for violations of the statute.
Workers' Compensation Update for Poster & Pamphlet Customers
The State of California Division of Workers’ Compensation has amended regulations related to Medical Provider Networks (MPN) which place new notification and posting obligations on employers. These changes took effect on October 8, 2010.
A New Leave for California Employers: Donor Leave
On September 30, 2010, Governor Schwarzenegger signed The Michelle Maykin Donation Protection Act. This new law is effective January 1, 2011 and applies to all employers with 15 or more employees and provides another right for an employee to take leave in California. The law requires employers to allow employees who are organ or bone marrow donors to take a leave of absence with pay.
The new law provides that:
- An organ donor must be permitted to take a paid leave of up to thirty (30) days during a one-year period; a bone marrow donor must be permitted to take a leave of up to five (5) days in a one-year period;
- The leave can be taken in one or more periods of time;
- The employee must provide the employer with a written certification that he or she is an organ/bone marrow donor and that there is a medical necessity for such donation;
- Such leave shall not constitute a break in service for the purpose of salary adjustments, sick leave, vacation, annual leave or seniority;
- The employer may require the employee to use up to five (5) days of earned but unused sick or vacation leave for bone marrow donation and up to two weeks of such leave for organ donation;
- The employer must pay for continued coverage for the employee under its group health plan for the duration of the leave;
- Such leave shall not be taken concurrently with any leave taken under the FMLA and/or CFRA;
- An employee shall be restored to his/her former position upon return from leave unless the failure to restore the employee to the former position is unrelated to the employee's exercise of his/her right to take donor leave; and
- An employer shall not discriminate against an employee for taking donor leave.
Nevada Minimum Wage Went Up July 1
Despite the record unemployment in Nevada, if you have minimum wage employees, they got a raise on July 1:
- For employees who are offered qualiftying health benefits, the minimum wage rate is $7.25 per hour.
- For all other employees, the minimum wage rate is $8.25 per hour
Also effective July 1, the minimum hourly wage an employer must pay in order to be exempted from the payment of state overtime is as follows:
- For employees who are offered qualifying health benefits, $10.875 or more
- For all other employees, $12.375 or more
The federal minimum wage rate is still $7.25 per hour and employers are required to pay overtime in accordance with the federal Fair Labor Standards Act.
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RSJ/SWENSON QUARTERLY NEWSLETTER
HUMAN RESOURCES AND MANAGEMENT NEWS
OCTOBER 2010
OCTOBER 2010IN THIS ISSUE
This newsletter, like all materials, training, and services offered by RSJ/Swenson LLC are offered and sold with the understanding that it is not engaged in rendering legal counseling or other professional service. If legal counseling or other professional assistance is required, the services of a competent practitioner in the relevant area should be sought.
At RSJ/Swenson, our mission is to support businesses like yours with training, products and services designed to reduce your liability and simplify your life. We work with you to put together your employee handbook; to ensure you're compliant with state and federal labor laws and practices and provide non-harassment training. Give us a call at 818.461.1874 or visit our web site at www.rsjswenson.com and see how our solutions can benefit your business.
