While employee reviews have obvious benefits from a Human Resources standpoint, implementing a policy that ensures employee reviews are well-crafted and accurate today, can go a long way toward insulating the company from potential liability tomorrow. Courts have consistently held that discharged or transferred employees can use performance reviews to show that they were treated differently based upon their membership in a protected class. In such “disparate treatment” cases, a performance review may establish or contradict that: 1) the employee was qualified for a position; and 2) someone outside of the protected class with similar qualifications was treated more favorably.
When deciding whether an employee was “similarly situated” to someone who may have been treated more favorably, a court will consider “whether a prudent person, looking objectively at the plaintiff and her comparator would think them roughly equivalent, and similarly qualified for the position.”
Employee reviews may be used as a tool to create evidence of work experience, or lack thereof. For example, if Employee A completed six significant projects in 2018, but Protected Employee B, who held a similar position, only completed three significant projects, employee reviews documenting the work experience of Employees A and B may be evidence that Employee A is the “more qualified” employee. Alternatively, if Employees A and B each receive similar, perfunctory review ratings of “good” or “3/5,” a court may have more trouble crediting the company’s decision to terminate Protected Employee B based on poor performance, where the only difference between the employees appears to be that one is in a protected class.
As such, an accurate, detailed, and well-written employee review can be a way for a company to combat an employee from attempting to show that she was as “similarly qualified” as another employee. If a company does not ensure that reviews are done thoroughly and accurately for underperforming employees, however, the results can be devastating. Indeed, a recent First Circuit case emphasized that courts should consider the employee’s “experience and reputation” to determine whether discrimination has occurred, and compare two employees “in all relevant respects.”
A good review policy will have several aspects. First, reviewers must include specific examples of an employee’s performance (especially, performance deficiencies). It is also critical to document an employee’s performance on specific projects and note whether performance exceeds or falls short of similar employees’ performances. This will not only give the company a legitimate business reason for any future adverse employment action, but will also help fortify a defense if the employee brings a disparate treatment claim.
Second, while verbal reviews can be very helpful to employee development, from a prophylactic standpoint, it is critical that reviews be in writing, dated, and placed in the employee’s personnel file.
Finally, be consistent. If employees in similar positions have different supervisors, be sure the reviewing supervisors have some type of structured criteria to use while reviewing. Provide supervisors with tools to ensure consistent reviews (such as a template with ways to grade employee performance), so that a court may compare “apples to apples” instead of “apples to oranges.”
While employee reviews may not be at the forefront of your mind for year end, implementing a protocol for reviews is a cost-effective way to insulate the company from potential future claims. Failure to do so could result in an unsettling surprise, should the company ever find itself in need of exculpatory evidence to prove the lawfulness of its employment actions.