February 22, 2019 221
February 22, 2019 221
Performance appraisal means the process of defining expectations for employee performance, measuring, evaluating, and recording employee performance relative to those expectations; and providing feedback to the employee.
A major purpose of performance appraisal is to influence in a positive way, employee performance and development. This evaluation also assists the entrepreneurs in assessing their staff’s cheers, attitudes, potentials and past performance on the job.
Entrepreneurs must be objective and careful in their staff evaluation because when staff is communicated of their poor rating, their morale is always affected which will increase their absenteeism rate and tardiness and consequently their overall production.
The information obtained from the performance appraisal is used for promotion, demotion, transfer, pay increase, training and development and discharge.
These are the most common appraisal methods:
The employee’s general behavior and characteristics rate scale could be formed by these factors below:
The employee could be rated against each factor enlisted above with the score in terms of Unsatisfactory, Average, Above Average and Excellent. The total score is the employee’s Highest Level of Performance for each individual.
The performance appraisal process is complicated by the fact that entrepreneur’s memories are somewhat fallible and entrepreneurs are liable to biases that produce rating errors.
Some of these are:
The training of raters may help in overcoming these biases. The performance evaluation is not an end in itself; it helps the employee know his weaknesses and strengths, and help the employer make some basic decisions on how to distribute organizational favors. The equity demands that those employees that work harder should derive greater benefit. The main purpose of any evaluation is not punitive but corrective; this can be done not only yearly but also periodically.
Compensation is designed to motivate employees to work harder, retain their services, attract qualified and capable hands and above all establish a healthy relationship between the employer and employees.
Compensation is one of the major factors that help in maintaining organizational peace if properly handled. Entrepreneurs are advised to give good monetary compensation to their workers if they should be kept happy, motivated and stay long in the organization.
Compensation consists of wages paid directly time worked, as well as a more indirect benefit that employees receive as part of their employment relationship with an organization.
Wages paid for time worked is typically payments made in a cashable form that reflect direct work-related remuneration such as base pay, merit increases or bonuses. Benefits, on the other hand, are forms of compensation beyond wages for time worked, including various protections plans (such as health insurance or insurance), services (such as an organizational cafeteria or drug counseling), pay time not worked (such as vacations or sick leave), and income supplements (such as stock ownership plans).
Benefits are considered a more indirect form of compensation because they are generally not as closely tied to job and performance issues as are other forms of remunerations.
Entrepreneurs should be aware that a qualified worker with a small pay is likely going to leave an organization and join a competing one where he would be paid higher. Having this in mind, they should attempt to develop a compensation system that carefully considers issues of equity and fairness.
Equity issues are important because individuals tend to compare their own relative inputs and outcomes with those of others in assessing the degree of equitable treatment that they receive.
In practice, developing fair compensation systems is quite challenging primarily because four major types of equity are involved:
There are three main components of a good remuneration policy:
Normally, when an employee is employed, there is always an agreement signed between the management and the employee regarding the method of leaving the company. It is agreed by both sides to give one-month notice to either side when separating. There are many ways of separation, namely: resignation, retirement, death, discharge, layoff, and disability.
Resignation is the process whereby the employee voluntarily or compulsorily applies for separation of work in an organization. Required notice of resignation is normally given after which resignation takes effect.
There are many reasons why one can resign in an organization such as job dissatisfaction, poor payment, unfavorable environment, discrimination, oppression, non-payments etc. For the entrepreneur to keep his good staff he has to endeavor to meet up with some of the genuine demands of the employees to keep them motivated.
This is the type of separation where the employee retires voluntarily or involuntarily (mandatory). In some cases, the employee may be retired by the organization compulsory to create a chance for the young ones. Another one is when the employee is advised to retire when he commits an offense or has reached the age of retirement.
In Nigeria, the retirement age in the public service is 60 years and recently the judges’ retirement age has been raised to 70 years due to the nature of their job.
In other words, if somebody worked up to 35 years in one organization he will retire even if he has not reached 60 years of age. So it is either you have reached 60 years of age or worked 35 years in one organization.
Again if one has worked up to 10 years one will be entitled to earn pension but will start earning it as from the age of 45 years. With this information, the entrepreneur is advice to start preparing for the retirement of his employees by introducing a retirement income scheme where reasonable gratuity will be paid to staff on retirement.
Death could be as a result of an accident in the workplace or outside the workplace. It could equally be a natural death, whoever may death come, the separation must occur. Since this is an inescapable issue, the entrepreneur should always get ready for such type of separation anytime it may occur.
The most painful method of separation is discharged. This is because an employee may find it very difficult to be employed by any organization that knows the reason for discharge.
Many occasions discharged workers are not paid compensation. Many organizations spelled it clearly in their contract book those offenses that may attract discharge such as gross indiscipline like stealing, fraud etc.
Many organizations are equally fraudulent in the way they handle their employee separations, hence they can discharge some employees unjustly. The local trade (labor) unions are always on hand to see that their members are not unjustly separated.
This is the process of standing off of the employee either on a temporary or permanent basis. Many organizations due to the hard economic situations are forced to trim down in their operations, and normally this action will lead to the slimming down of staff on a temporary basis or permanent basis, hence-layoff.
When employees are laid-off on a permanent basis, they are usually paid their financial entitlement-gratuity and pension if applicable. If the layoff is on a temporary basis, the employees may not be paid since they are coming back to the organization when the situation improves. Layoffs should always not be seen as an end of the world by the employees since in most cases it is never the fault of the employers.
This is another separation method where the employee is stopped work or stops work on his own due to disability on him. This disability could be from the workplace or outside the workplace. At times workers are temporarily or permanently disabled from their workplace or outside their workplace. If it is from the workplace the staff will be compensated by the organization according to the gravity of the disability before being paid his entitlement.
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