Effective performance management relies on accurate information from performance reviews. Rater bias undercuts this effort by calling into question the accuracy of these ratings. No one is immune to rater bias, so every HR professional should be aware of its impact.

Biases like the halo effect, the leniency bias, and the “similar to me” effect may artificially inflate ratings. Meanwhile, the horns effect, the strictness bias, and the recency effect can lead to too-low ratings, even for high-performing employees. No HR professional wants to make high-stakes decisions, like promotions, raises, or dismissals, based on inaccurate data. HR has a moral, and legal, imperative to make sure performance review information is high quality.

Luckily, there are solutions. Researchers have identified best practices to dramatically reduce the impact of rater bias on performance reviews. Apply these five strategies to your performance management system to ensure that your employees are receiving fair and accurate ratings that are not colored by rater bias.

What is Rater Bias?

What is rater bias? At its core, rater bias refers to the tendency of evaluators to let their personal opinions and prejudices influence their assessments of others. It’s like wearing tinted glasses that color your perception of someone’s performance.

Rater bias can manifest in various forms. For instance, there’s the halo effect, where an evaluator’s overall positive impression of an individual clouds their judgment about specific aspects of their work. On the flip side, there’s the horn effect, where a negative perception influences the evaluation even when other areas may be commendable.

Then there’s the recency bias. This makes raters focus heavily on recent events or performances rather than considering an individual’s overall body of work. And let’s not forget about stereotyping biases that might lead raters to make assumptions based on gender or ethnicity.

There are even more types of rater bias lurking in the shadows. The leniency bias occurs when evaluators consistently rate employees higher or lower than they deserve across all dimensions. And don’t underestimate the central tendency bias either – it happens when raters give everyone average scores regardless of actual performance levels.

How Can Rater Bias Impact Performance Reviews?

Rater bias can have a significant impact on performance reviews, influencing the evaluation and feedback given to employees. This bias occurs when subjective opinions and personal preferences of the rater overshadow objective assessments of an individual’s performance.

Rater bias can lead to unfair evaluations. When biased opinions are involved, employees may not receive accurate feedback about their strengths and areas for improvement. This can hinder their professional growth and development.

Rater bias can perpetuate stereotypes and discrimination in the workplace. If biases based on race, gender, or other protected characteristics influence performance ratings, it can result in unequal treatment and opportunities for individuals from marginalized groups.

Moreover, rater bias affects employee morale and engagement. Employees who perceive unfairness or favoritism in the review process are likely to become demotivated and disengaged. This ultimately hampers productivity within the organization.

Additionally, biased performance reviews can negatively impact teamwork and collaboration among colleagues. If specific individuals consistently receive higher ratings due to favoritism or prejudice rather than merit-based evaluations, it creates resentment among team members.

Rater bias undermines organizational trust and credibility. When employees perceive that personal biases rather than objective criteria influence the review process, they lose faith in management’s ability to make fair decisions.

Addressing these issues related to rater bias is crucial for creating a fairer work environment where all employees have equal opportunities for growth and recognition based on their actual contributions.

1. Build Awareness of Rater Bias

Rater bias affects everyone, but it usually occurs on an unconscious level. This means that most employees will not be aware of their biases, even when biases are dramatically impacting how they rate their coworkers.

When performance appraisal season comes around, invest time in training your staff about the most common rater biases. Making employees aware of bias is the first step towards reducing it.

For most employees, a short training that covers just the highlights is probably enough to do the job. However, senior staff, such as supervisors or managers, often complete performance reviews more frequently. They would benefit from more in-depth training on understanding and reducing their own bias.

Be sure to educate on all different types of bias, including (but not limited to):

• Gender Bias
• Recency Bias
• Unconscious Bias
• Similarity Bias
• Confirmation Bias
• Common Bias
• Centrality Bias
• Personal Bias
• Idiosyncratic Rater Bias

2. Use Objective, not Subjective, Ratings

When designing your performance review questions, pick question anchors that ask about observable, objective behaviors. A good example of a top rating might be, “Rarely or never misses deadlines.” This is clearer and more objective than a simple, “Meets Expectations” or “Exceeds Expectations.”

Subjective ratings are not recommended because they are often murky and rely on judgment. A supervisor might check an employee’s records to determine if they have been meeting deadlines. However, if they are asked to make a subjective judgment about personality, style, or attitude, all they can do is go with their gut. That’s exactly where unconscious biases rise to the surface and begin to impact ratings.

3. Reduce Reliance on Memory

We like to think of our memory as a museum filled with well-preserved accounts of our past experiences. Unfortunately, research on memory consistently shows that our memories aren’t always accurate, especially when emotions get involved. The more performance ratings rely on memory, and the longer back raters have to think, the less accurate performance reviews become.

One strategy to reduce reliance on memory is to have more frequent performance reviews throughout the year. This lets raters focus on more recent, more easily remembered events. Try biannual or even quarterly performance reviews rather than just once each year.

Online employee performance reviews, facilitated by quality performance management software, are the ideal way to manage the extra information gathered by more frequent reviews. They simplify the process of collecting and analyzing performance reviews, which minimizes the burden on employees and HR professionals.

A second strategy to reduce reliance on memory is to encourage note taking in between performance ratings. Raters can look back at their notes to remind themselves of positive and negative performance. This reduces reliance on memory, and ultimately improves the accuracy of ratings.

4. Implement 360 Degree Feedback Systems

Even with the above techniques, there is no way to eliminate all bias. Because of this, it is never wise to rely on a single rater for employee evaluations.

Instead, it is best practice to gather performance ratings from multiple sources. This gives you a more complete picture of actual performance while minimizing the impact of any particular rater’s bias.

360 Degree Feedback systems are ideal for for this task. They naturally allow for feedback from a variety of sources, including supervisors, direct reports, peers, and even customers. This provides a wealth of information on employee performance, and grants you more confidence in the accuracy of the review process.

For 360 Degree Feedback to be effective while not being an undue burden, you’ll need performance management software that is up to the task of streamlining your system. Select software that allows for easy reviewer assignment, allows ratings from reviewers outside the company, and allows for anonymous reviews so ratings aren’t impacted by fear of retaliation.

5. Carefully Monitor Performance Feedback Data

Rater bias can often be detected by carefully examining performance feedback data. Using performance management software, keep an eye out for clues that bias may be in play. Look for:

• Outliers. If an employee has mostly consistent ratings, except for a single rater with much higher or much lower ratings, rater bias may be the culprit. Interpret outliers with extreme caution.
• Little Variability Across Ratings. If, on the other hand, a single rater seems to have the same ratings for everyone he or she reviews, consider if the strictness, leniency, or central tendency bias is playing a role.

Performance management software is critical for facilitating this kind of analysis. Select software that makes it easy to look at company-wide trends, while maintaining the ability to zoom in on individual employee or individual rater data.

6. Encourage Self Assessments

Ask employees to evaluate their own performance before the formal review. This can help uncover any gaps in perception between the rater and the employee. This can help with rater error rates because employees tend to pay more attention when they are rating themselves.

Self assessments are helpful for managers as well because they help them understand where an employee thinks they are. If an employee feels like they are doing a great job and then, during the performance appraisal, there is a discrepancy, managers can help realign and come up with KPIs for the specific role.

7. Encourage Specific Feedback

Encourage raters to provide specific examples and evidence to support their ratings. This helps make the evaluation process more objective and less prone to subjective biases.

During the performance review process, it’s a best practice to have the HR team look over the review to ensure it aligns with the rating scale set before reviews. HR should identify areas where managers should include these specific examples on individual performance.

8. Regularly Calibrate Ratings

Conduct calibration meetings among raters to ensure consistency and alignment in evaluating performance. This allows for discussions and clarification of expectations, reducing individual biases.

HR leaders should look over performance data and the performance management process to understand if the rating system is working. If you are seeing trends that are troubling, like too many people getting a higher rating in one area than maybe they should, it may be time to calibrate ratings. Rating accuracy is an important part of a successful performance evaluation process.

9. Add in Behavioral and Intrapersonal Skill Ratings

Structure the evaluation process around specific behaviors and outcomes rather than personal attributes or characteristics. This helps focus on observable and measurable performance factors, minimizing bias.

During the employee performance review, this won’t make up a large part of someone’s score, but it can help to reduce rating errors and provider justification for job performance.

10. Keep Your Eye on Things

Create an organizational culture that values feedback, open communication, and fairness. Encourage dialogue between employees and raters to address any concerns or biases that may arise.

Hold raters accountable for their evaluations and ensure they understand the importance of fair and unbiased ratings. Provide guidelines and resources to support raters in making objective assessments.

Keep track of performance ratings and demographics to identify any potential disparities or patterns. If disparities are found, investigate the underlying reasons and take appropriate actions to address them.

Why is it Essential to Reduce Rater Bias in Performance Reviews?

Why is it important to reduce rater bias in performance reviews? The answer lies in the potential consequences of biased evaluations. When rater bias is present, it can lead to unfair assessments and decisions that can impact an employee’s career trajectory.

Reducing rater bias promotes fairness and equality in the workplace. Performance reviews are meant to provide an accurate reflection of an individual’s skills and contributions. However, if biases such as gender, race, or personal preferences come into play, deserving employees may be overlooked or undervalued.

Reducing rater bias enhances employee morale and engagement. Employees want their hard work recognized and valued fairly. When they perceive bias in performance evaluations, it can create feelings of resentment or mistrust towards management or the organization as a whole.

Additionally, reducing rater bias improves overall organizational effectiveness. Biased performance reviews can result in subpar talent management decisions – promotions based on favoritism rather than merit or high-potential individuals being overlooked due to prejudices.

By minimizing rater bias in performance reviews through strategies like training raters on unconscious biases and using objective evaluation criteria consistently across all employees’ assessments – organizations can foster a more inclusive culture where everyone has equal opportunities for growth and success.

The Best Performance Management Software to Reduce Rater Bias

To effectively minimize the impact of rater bias on your human resource decision making, you’ll need powerful performance management software.

Trakstar includes 360 Degree Feedback, which facilitates quality performance reviews from a variety of sources. Use them to set up online employee performance reviews to streamline the process. Moreover, they make data analysis simple, allowing your HR department to carefully watch for signs of bias.

Performance management software is the key to effective performance reviews. You can trust Trakstar to minimize rater bias in your company.