I’ve said this before and I’ll say it again: I hate performance reviews.
Yes, I understand how valuable they are to all involved – both employee and employer – and perhaps I would feel a lot differently about them if I ever worked somewhere with a talent management system that allowed you to automate the process and make it both easier and more meaningful for everyone. In that case, it’s less about the process and more about helping to really track and improve employee performance.
But I have never, ever had the luxury of using one of those automated talent management systems. All the places I have worked were stuck in the old, fill-out-the-annual form mode, where performance reviews were a pain and a bother for everyone involved.
That’s the wrong way to approach such an important topic, and I certainly know it, so that’s why I found this story to be a wake-up call for people like me who still are stuck doing old-fashioned performance reviews and loathe the process. It proves – as if we needed more proof – that ignoring or downplaying reviews and the review process can be very costly, as the city of Henderson, Nevada found out this week.
According to a story in the Las Vegas Review-Journal, the city of Henderson could end up paying more than $1 million (and perhaps as much as $1.4 million), to a former city manager who sued after she was fired for breach of contract back in 2009. And, the lack of a performance review is partially to blame. Here’s what the newspaper said:
An arbitrator has ruled against the city in a breach-of-contract claim brought by Mary Kay Peck, who spent 18 months as Henderson’s first female city manager before being dismissed with cause by the City Council.
In his interim order, arbitrator Gerald McKay ruled that city officials failed to prove they had sufficient cause to fire Peck from the $225,000-a-year job. McKay gave the city 30 days to negotiate damages with Peck’s attorney, Norman Kirshman, who is predicting an award “in excess of a million dollars…”
McKay wrote that the city’s contract with Peck made it clear she could be fired “for any reason or for no reason,” but if she were to be fired without cause, as defined by the contract, she would be entitled to compensation…
Kirshman said Peck received no formal performance reviews during her time as manager or anything in writing that found fault with how she was doing her job…
In the wake of her complaints about not receiving formal evaluations, the City Council resumed the practice of conducting regular reviews of its top three administrators for the first time since 2002.”
It’s not clear from the story just how much of a factor the lack of a performance review played in the arbitrator’s ruling, but not having one (or more) reviews certainly helped make the fired city manager’s point that she was fired “without cause” and entitled to compensation upon termination.
If this isn’t yet another wake up call – a million dollar one — for guys like me who hate doing performance reviews, I don’t know what is. Avoid them at your own peril.
There’s more than performance reviews in the news this week, and here are some other workplace and HR-related items you may have missed while celebrating the New Year. Yes, this is a weekly round up of news, trends, and all sorts of information from the world of HR and talent management. I do it so you don’t have to.