How to Systematically Determine Who Should Get a Raise When Evaluating Employee Performance

Your employees aren’t working as volunteers, so the subject of pay does come up—often once a year. Many employers award workers annual pay bumps based on the cost of living increases. Beyond that, performance-based raises are an incentive to work hard and can be incredibly motivating to your employees. If you decide to award performance-based raises, you’ll need to determine the parameters on which you’re reviewing employees, to be sure you have a clear understanding of who has earned how much.  

How to evaluate employee performance 

Scoring each employee on a numeric scale can give you an idea of how much to award come raise time.  By assigning a percentage to each number on the scale, you’ll have a clear idea of how much an employee will be rewarded. It’s up to you to determine if all employees will get at least some increase, or only those performing at or above a particular threshold. Keep in mind that only awarding certain employees raises can create resentment; however, it’s motivation to work hard. 

Performance appraisal best practices 

Your annual performance review can be more effective when you follow these guidelines: 

• Start with good communication. This is key to supporting your employees. An annual performance review shouldn’t be the first time they hear feedback from you on their job performance. By meeting regularly throughout the year, you’ll be able to provide continuous insight into their work, what they’re doing well and what they can do better.   
• Set goals. During regular meetings with each employee, work together to set goals. Then, your employees will have a clear understanding of exactly what you expect of them. You’ll be able to review their performance based on how well they’ve achieved these goals.  
• Be clear. Always make sure your employees understand their roles and responsibilities, the scope of projects and what you need in order for them to achieve their goals. This straightforward approach will help them stay focused on the task at hand, rather than wasting time trying to figure out what you want them to do.  
• Be supportive. Everyone runs into roadblocks from time to time. Be a source of support and guidance to your employees and help them work around difficulties they encounter on the road to achieving annual goals. The best leaders are also good teachers.  

Need to staff up? 

You may find your employees are overworked due to low staffing levels. And in that case, to preserve your staff and keep them productive, it may be time to staff up. The fastest and easiest way is to work with a recruiter.  

Check out Inter-Connect Employment Services

We guide our clients toward the staffing model that works best based on your short- and long-term goals. To learn more about the staffing services we offer, contact us today!