Employees and managers alike both approach performance appraisals with a bit of disdain. Originally designed to evaluate a workers' performance for a salary review, when handled incorrectly, a performance appraisal can lead to low or poor morale, even in the best of situations. As in many other areas of business management, experts stand divided between the pros and cons of performance appraisals.

Assessing Work Performance

A performance appraisal allows a supervisor the opportunity to assess an employee's work performance. The argument against performance appraisals is that they only present the subjective view of a supervisor. In situations where a supervisor dislikes an employee, the performance appraisal becomes a tool to use against an employee. In opposite scenarios,where the employee and manager are good friends, an appraisal may be slanted to the employee's favor and doesn't offer a valid review of job performance. Some management experts and human resource professionals feel that a performance appraisal is a poor substitute for good management practices.

Mishandled Reviews

Even when a high-performing employee receives a mostly positive performance appraisal, he more than likely focuses on the negatives in the performance appraisal, which can affect his morale and work ethics. When supervisors don't understand fair labor laws and employee civil rights, a bad review with hostile or discriminatory language can cause serious issues at work. Incorrectly managed appraisals can also lead to serious fines, penalties and lawsuits when supervisors illegally discriminate against an employee in a performance appraisal because of race, religion, age, sex or disability.

Feedback

On a positive note, a performance appraisal allows an employee's manager to provide feedback, offer suggestions to work habits and provide the employee with a benchmark for objectives. A good performance appraisal can become the basis the manager needs to support an increase in an employee's salary -- the original purpose of the performance appraisal. Performance appraisals allow employees to know where they stand, and what they must do to improve.

Benfits of Performance Appraisals

A well-managed performance appraisal encourages managers and employees to take a team approach when setting goals and objectives, and discuss any work issues and concerns. It can also help to remind supervisors of the importance of employee motivation, and communicating company goals and objectives to employees. Through regular appraisals, employees gain insight to areas that need improvement or strengths they can enhance. A good performance appraisal and meeting with the manager can also help a person make career plans with the company or focus on opportunities for growth.

Alternatives to Traditional Appraisals

An annual performance appraisal may not be the best tool when you need to offer course corrections to employees sooner than just once a year. Some companies have eliminated the once-a-year performance appraisal and replaced it with quarterly employer-manager reviews, peer reviews, self-reviews and team performance reviews where work appraisals become a regular, less intimidating event.