It is interesting to explore two things when we discuss mid-term appraisals – one, the definition of appraisals and second the seemingly obvious link to salary. A mid-year performance evaluation typically would entail mainly a one-on-one session between the people manager and his team members, followed by discussions with business unit leaders and the HR team, after half the performance cycle or financial year is completed. In the true sense of the word, it merely means evaluating where the employee’s performance is with respect to the goals. However, when we call the same thing an appraisal, it has a different connotation that connects to rewards or compensation.
Some of the key elements that drive employee engagement are: Being empowered to drive results; Being able to move into high responsibility roles; Being given an opportunity to work on developmental assignments; Being recognized for high performance.
When one looks at these closely, it is evident that none of these are related to salary revisions. Hence, it’s likely that mid-term appraisals might not be a predominant driver of employee engagement.
However, to disregard its value totally in terms of the role it might play in employee engagement might not be wise. It might be pertinent in some situations or organisations.
- In organisations where pay parity or internal equity has been a challenge, a mid-year appraisal can resolve issues within a team that arise due to this, thus improving engagement levels.
- In case of role changes due to organisation restructuring, where some roles receive greater accountability, a mid-term appraisal can surely boost the morale of the employee who might be otherwise impacted by the changes within the firm.
- A mid-term appraisal when there is a superlative performer whose work has had a positive business impact, sets an example, creates a role model and boosts a performance driven culture.
Hence, whether a mid-term/mid-year evaluation will have a strong or minor impact on employee engagement levels is determined by the situation within the organisation, the role and the individual who receives the appraisal.