In a survey conducted by a top recruitment agency, around 62% of employees wanted to change jobs after the appraisal season. Performance appraisals are one of the most awaited seasons for employees who have put in all the long hours at work and clocked all-nighters. It’s the time when their hard work and responsibility would be recognized and acknowledged. Climbing the career ladder or getting a salary hike seem within their reach.
While this season is a time of bliss and appreciation, not all employees get to share the same feelings. Some of them feel that they were not given their expected salary hike or missed opportunities for promotion. Such challenges, when left unaddressed, have a negative impact on employees’ mental health. They experience disappointment and a sense of demotivation along with increased stress and fear of negative consequences. This can potentially strain workplace relationships and reduce job satisfaction, ultimately leading to burnout or resignation from the company.
Initiating open discussions and improving the feedback system significantly helps in managing unhappy employees after appraisal. Firstly, look out for specific signs that indicate that an employee is unhappy after appraisal before following up.
What are the early indicators of employee unhappiness post-appraisal?
Some companies fall short when it comes to embracing performance management as a continuous process. Performance management is treated as an annual event which potentially neglects the importance of continuous feedback, coaching, and ongoing performance discussions.
For instance, Zynga, one of the leading social video game service companies, is an organization that thrives on numbers and performance data. In the early 2010s, Zynga experienced rapid growth and success with popular mobile games. As the company expanded, it struggled to manage its workforce. Employees at Zynga felt disconnected and unsupported after the annual performance appraisal process.
While the company provided ratings and conducted appraisals, there was a lack of meaningful conversations, post-appraisal follow-up, and discussions regarding individual performance. As a result, several employees were emotionally discharged and had mental breakdowns post-appraisal. This had a massive negative impact on Zynga’s culture. Its culture was viewed as a serious liability, and it potentially risked a talent drain.
Organizations must be keen on noticing signs of employee unhappiness before it’s too late. Some of the major indicators are:
After an appraisal, if an employee suddenly takes frequent time-off, is the first one to leave, and the last one to arrive, this is a sign that the employee is dissatisfied with something. Employers should ensure that frequent absenteeism is not due to legitimate reasons.
Instead of disciplining them and negatively impacting their right to sick days, try to get them engaged in their positions through engagement surveys, gamified learning, development modules, and career development.
Not adhering to deadlines
When a normally steady and productive employee suddenly starts missing deadlines, is procrastinating, and turning in poor quality of work, this could indicate that they are unhappy. There’s a visible decrease in motivation and productivity.
Employers must provide adequate career development opportunities so that employees are engaged in their position. Provide them with challenging goals, training courses, and mentorship opportunities to re-motivate a disillusioned employee.
Loss of interest to work on different team projects
Just because an employee appears withdrawn does not necessarily mean that they are unhappy with their position or the company. Notice employees whose work attitudes have changed gradually over a period of time. For example, an employee who was enthusiastic about taking on different projects is suddenly uninterested, lacks initiation, and appears irritable, there’s a clear problem that needs to be addressed.
Try appointing a work buddy, offering help, and providing ways for employees to report problems, both related to appraisals and work in general.
Mental exhaustion is more than just sleepy days at work. Keep an eye on those who are constantly exhausted and frustrated. Take action before the employees are burnt out by promoting a healthy work-life balance, paid time-off, open conversations, and continuous feedback before they become sources of exhaustion.
Employees reaching out to their managers or HR is a direct indication that they are unhappy with something. Do not push away their concerns aside and respond immediately to avoid any lawsuits or adverse consequences. Empathize with their struggles and provide solutions to improve their working conditions.
No connection to the workplace
When unhappy with the appraisal they receive, employees usually become less committed. They suddenly desolate themselves, interact less with the team, do not show up as often for group discussions, and display less interest in everything.
The effect of bad appraisals is momentary. It all boils down to how a company treats its employees throughout the year, which actually molds the decision of the employees.
– Kamlesh Dangi, Group President of Human Resources, UTI of Mutual Funds.
While performance appraisals are the most awaited by some employees, they are also the most dreaded topic for both the company and employees.
It’s important to note that regardless of how fair a company’s performance review process is, there will always be a section of employees who are left dissatisfied after the appraisal season.
As to why employees are dissatisfied and taken aback during appraisals, the next topic explores such intricacies.
Substandard performance unveiled – why does it occur during appraisals?
The main problem arises when employees believe they have performed really well but the appraisals do not meet their expectations. Organizations must foster a culture of continuous feedback where individuals are aware of their performance and know what to expect during the appraisal process or they might be caught off guard because of such negative surprises. Managers must give developmental insights to improve employee performance and reward excellent work.
Most humans struggle to handle inconsistent feedback. We are all generally conditioned to absorb inputs and internalize them over a period of time. Therefore, if the performance feedback is not consistent with prior conversations, it is natural to trigger negativity.
– Shailesh Singh, HR Head, Director and CPO, MAX Life.
A person’s view on his performance is limited. When provided with adequate feedback, it clears the gap between how a supervisor and individual view performance. When the appraisal fails to align with an employee’s self-assessment, it leads to dissatisfaction. Periodic feedback from multiple sources must be encouraged within the organization.
Apart from this, there are other major reasons why employees are faced with appraisals that do not meet their expectations:
- Companies have budget constraints. When there are limited funds allocated for bonuses and salary hikes, the appraisal received fails to meet the expectations of employees.
- It could be one of the cost-cutting measures. In such cases, most people within the organization receive a low or no hike. The rewards associated with appraisals could be low across the organization for every employee.
- The changing economic conditions, industry trends, and market rates affect performance appraisals. If the market is experiencing relatively low salary rates in the industry, the appraisals may not meet an employee’s expectations.
While these reasons vary according to an organization’s needs, employers must maintain consistent communication and provide feedback to manage expectations. By ensuring this, employees will be able to understand that the appraisal process goes beyond good performance alone and will not be caught off guard or by surprise.
As discussed above, there will always be a section of employees who are left dissatisfied, confused, and disappointed after every appraisal. When such feelings are left unmanaged, the following are the consequences:
Consequences of post-appraisal neglect
Gallup’s State of the Global Workplace: 2022 Report states that employees who are actively disengaged cost the world approximately $7.8 trillion in lost productivity. This is equal to 11% of GDP at a global level.
When it comes to performance appraisals, post-appraisal neglect refers to the lack of follow-up after conducting appraisals. Such neglect can have adverse consequences for the organization. They can be divided into 3 stages:
Stage 1: The Disillusionment Stage
The Disillusionment stage is an initial phase after appraisals the employees go through. Employees in this stage are left with a sense of disappointment when they have discovered that the appraisals were not as per their expectations. One of the most common challenges is that employees become negative about everything, and such employees should be handled with care and patience. When they are in the disillusionment stage, the following are the outcomes that affect an organization:
- Feelings of distrust
When an employee feels that their appraisal results are not taken seriously and are neglected, they harbor feelings of distrust. This potentially leads to bad industrial relations, negative work environment, decreased loyalty and collaboration.
- Decreased levels of productivity
Employees who believe that they have been undervalued and underappreciated lose motivation to perform their best, leading to decreased quality and quantity of work.
- Decreased motivation
If employees feel that their efforts are not recognized and appreciated, they perceive the company in a negative light and avoid taking any initiative. Overall, this leads to a decrease in innovative thinking and proactive behavior.
- Limited outreach
While some people reach out directly and voice their concerns, others avoid any confrontations and choose to stay silent. This is a bad sign as it may result in higher turnover rates or a decrease in overall employee wellbeing and engagement.
This stage is crucial and needs to be managed effectively in a timely manner before they become ground for long-term negative consequences. This phase can be managed by initiating open and transparent communication with employees during and after the appraisal process. This includes explaining the process, feedback, rationale behind assessments, and the reasoning of appraisal decisions. This helps reduce the feelings of disillusionment.
In the worst case where managers were ineffective in managing unhappy employees during this phase, the consequences in the next stage can worsen.
Stage 2: The Resistance Stage
The resistance stage is the subsequent stage which employees enter if they were not effectively managed during the initial disillusionment stage. Employees in this stage are increasingly disengaged and show signs of resistance and negativity. Some of the major consequences are:
- Lack of initiative
Employees are very unenthusiastic and lack initiative in taking up new projects and responsibilities. This behavior stems from feelings of distrust and decreased productivity in the initial stage, which were neglected. This results in limited innovation and reduced growth opportunities within the company.
- Less collaborative and cooperative
With limited outreach, employees gradually start to resent their peers which can lead to a significant decrease in collaboration and cooperation among themselves. This not only decreases teamwork and knowledge sharing but also the company’s ability to achieve collective goals and deliver results.
- Reduction in communication
As time passes, employees become unwilling to communicate and maintain transparency while also withdrawing from communication channels and resisting sharing ideas and information, thereby reducing decision-making, effectiveness, and coordination.
- Passive-aggressive behavior
Employees may shift to sarcasm, subtle defiance, and undermining their peers and managers as a way of expressing their frustration and disappointment. Such behavior fosters a toxic work environment, creating a sense of distrust and resentment among employees. This disrupts team dynamics and hampers overall organizational productivity.
Employers must ensure that individuals do not progress to the next phase. It’s crucial to take proactive steps like creating a safe environment where employees can express their grievances, offering guidance and support after 1:1 discussions, providing career development opportunities, and addressing their concerns as soon as possible.
Stage 3: Breaking point Stage
The breaking point stage is a further progression from the resistance stage, where the negative feelings and behaviors reach a tipping point. It results in more adverse consequences for both employees and employers. The consequences are:
- Significant decline in performance
Employees experience an extreme sense of detachment from their work and completely lose interest in their work and responsibilities, leading to a complete loss of motivation, performance, and productivity.
- Negative attitude and behavior
There will be an escalation of conflicts and disruptions caused by less collaboration and communication in the resistance stage, which was unmanaged. Employees in this phase openly confront authority and cause unwanted disruptions in the workplace.
This has a lasting negative impact on the company’s culture, leading to widespread disengagement and a toxic atmosphere.
- Openly expressing job dissatisfaction
There will be an extremely high rise in absenteeism where individuals take unplanned leave. They may openly express their dissatisfaction by turning in mediocre quality of work and being disengaged in everything.
- Seeking alternative employment
Employees seek alternative employment opportunities, resulting in a significant talent loss. It causes disruptions in team projects and brings down the company’s level of competitiveness.
In this stage where negative consequences have intensified, companies must implement effective strategies related to conflict resolution and employee mental wellbeing. Depending on the company, it may have to revisit its appraisal process or start celebrating achievements while also providing assistant programs.
Developing an effective process for managing post-appraisal discontent
While a performance appraisal process aims at evaluating employee performance and providing feedback, it is equally important to address the emotional and psychological impact that the appraisal outcomes may have on employee wellbeing.
For example, Swiggy is one of the companies that has done post-appraisal management right. It helped its managers get accustomed to the concept of regular feedback or continuous appraisals called ‘check-ins,’ which ensures that managers and employees are in sync with the work being done. They conduct regular skill-building exercises called Feedback Labs so that managers know how and when to give feedback. By conducting mandatory quarterly and half-yearly ratings, employees know what’s in store for them.
Swiggy believes that post-appraisal negativity is caused when there is inadequate trust between employees and managers or when there is a lack of objectivity in reviews. To tackle this, they have their grievance cell handle post-appraisal negativity. This department reaches out to employees after appraisals and handles employees’ pain points. To ensure that this department is working properly, at least one third of the decisions go in the favor of the employees. Employees use bad appraisals and work harder to perform better next time.
This has made a lot of difference to Swiggy in 2018 and kept its attrition rate low. It experienced significant growth and established widespread recognition.
The steps it followed:
Gather information and assess why the employee is unhappy
After appraisals, an employee displays dissatisfaction by showing signs of distrust and reduced communication. Promote open and empathetic communication to understand the reason behind discontent. Actively listen to their concerns and seek clarification on their expectations.
This provides insights into unaligned expectations, unfairness, and lack of communication in the process.
Arrange a meeting with the employee
Reach out to the employees through face-to-face discussions, email, or a formal meeting request. Set a clear agenda and allocate sufficient time for the discussion. Make sure to let employees openly express their concerns, frustrations, and why they are dissatisfied.
Help them understand that everyone is worried about their negative behavior
This helps manage employees who are progressing from the disillusionment stage to the resistance stage. Managers must voice the concerns of other employees who are being affected by negative behavior and gently explain how their attitude affects not only their performance but also their own wellbeing. This helps them reflect on their behavior and seek solutions to their frustrations.
Ensure fairness and respect
Involve them in the decision-making process and maintain trust. Justify the appraisal outcomes and address their concerns with empathy and patience.
Consider post-appraisal employee counselling
It’s important for companies to recognize the potential psychological effects of the evaluation and offer suitable assistance through employee counseling programs. This helps manage their emotional responses and address any grievances.
Develop individual development plans by collaborating with employees and deciding specific goals, objectives, and outcomes. Take actions that ensure their overall well-being and enhance their skills, knowledge, and career growth.
Celebrate their efforts
Officially recognize employees’ efforts through genuine verbal appreciation and acknowledgement. Highlight their achievements and provide them with enough opportunities for skill development. Consider organizing employee appreciation events, flexible work arrangements to balance work and life, assigning challenging assignments, etc.
How to set up a continuous feedback system?
In performance management, a continuous feedback system is vital for several reasons. For instance, a company that conducts performance evaluations only once a year and gives minimal feedback in between potentially limits communication between managers and employees. Hence, the appraisal process feels more like a formality than a meaningful discussion.
Employees will have a tough time understanding their performance expectations and often feel uncertain. With time, frustration grows, and employees gradually become disengaged when they are provided with little opportunities to seek guidance and address concerns. It also hampers individual growth and development. As a result, employees seek better employment opportunities, and the company may start experiencing high turnover rates.
Implementing a continuous feedback system helps nurture a culture of open communication, improve employee engagement, and drive better organizational performance. To set up such a system:
- Involve employees in the goal setting process. Encourage them to provide input and perspectives and align individual goals with broader organizational objectives. By focusing on proper goal setting, employees have a better understanding of what’s expected of them.
- Once goals are set and clear, conduct one-on-one meetings between managers and employees. This provides opportunities to discuss progress, address any challenges, and provide proper guidance and feedback.
- Promote open and honest communication. Two-way communication helps employees share their ideas and concerns without fear of repercussions.
- When implementing a continuous feedback system, start with small teams before rolling it out organization wide. This helps gather feedback and address barriers to make necessary adjustments in the system beforehand.
Don’t forget about your other employees
While managing unhappy employees after appraisals is important, it is also equally important to maintain a positive work environment for the entire workforce. Focusing solely on either of the groups divides the team from within, which can impact the overall morale and performance. Maintain open communication with all employees, recognize and acknowledge efforts and achievements of all, and don’t forget to offer opportunities for learning and development.
Closing the loop…
Ensure all the necessary steps are taken in performance management, especially by providing timely and actionable feedback. By adopting Keka’s continuous feedback system, bridge the gap and make sure that the feedback is effectively shared and acted upon. With Keka, recognize employees in public, provide private feedback, conduct 1:1 meetings, and access past feedback.