Are There Legal Implications in the Performance Appraisal Process?
Yes. Performance appraisals can influence compensation, promotion decisions (and the opportunities to gain promotions through training or a high-visibility project assignment), layoffs (downsizing tied to job performance), and termination for cause. Consequently, appraisals are targets for legal action by disgruntled employees who charge bias in your evaluation or the way you implement the appraisal system.
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It can help you if you are aware of those major employment laws related to performance assessments:
Title VII of the Civil Rights Act. This makes it illegal for an employer to discriminate against an employee in promotion practices, as well as hiring practices (see Chapter 5), because of the individual’s race, color, sex, creed, or national origin.
The Equal Pay Act. This act stipulates that employees who perform similar jobs must be paid equally.
The Age Discrimination in Employment Act (ADEA). This act protects employees and applicants more than forty years old. It states that employers may not discriminate against individuals in this age group in either hiring or promotion decisions.
Section 508 of the Rehabilitation Act. Employers cannot discriminate in hiring or promoting the handicapped.
The Vietnam Era Veterans Readjustment Assistance Act. Under this act, companies with contracts of $10,000 or more with the U.S. government must take affirmative action to employ and advance in employment qualified disabled veterans and veterans of the Vietnam era.
The Americans with Disabilities Act (ADA). This act, as noted in Chapter 5, makes it illegal to discriminate in hiring, in job assignments, and in the treatment of employees because of a disability. It doesn’t affect evaluations directly, but it should be considered when managers are giving a poor evaluation to someone with a disability. Could it land them in court? The answer: maybe, but probably not. The law doesn’t allow disabled individuals—no matter the disability—to get away with not doing their work. But every reasonable effort must be made to accommodate the employee’s work to the disability.
There are regularly new developments with these laws, including court decisions, that you should make an effort to be aware of. For instance, since passage of Title VII of the Civil Rights Act, overt workplace discrimination has decreased. So courts now look for subtler signs of discrimination, like the existence of code words that demonstrate a hostile environment for plaintiffs. In Aman v. Cort, for instance, two black employees sued their employer, claiming that they had been subjected to an atmosphere of racial contempt and harassment. Blacks at the organization were referred to as "another one" or "one of them." The court found for the plaintiffs, noting that "anti-discrimination laws and lawsuits have ‘educated’ would-be violators such that extreme manifestation of discrimination are thankfully rare." But, the court continued, discriminatory conduct still persists. It is just that racial intent is now often masked.