The Development of a Pay-for-Performance Appraisal System for Public Park and Recreation Agencies: A Case Study

Abstract

Well-designed employee performance appraisals provide agencies with information that can guide administrative and developmental decision-making about their most important asset—their human resources. Administratively, performance appraisals serve as the formal evaluation tool used by managers when making decisions about distribution of pay increases. Developmentally, performance appraisals assist agencies in identifying issues such as employee training needs, selection, and promotional opportunities (Milkovich & Newman, 2005). Despite its importance, an agency’s performance appraisal system is often viewed by employees and management as a frustrating and unfair process. These frustrations are largely attributed to performance appraisal instruments that are not job related, have confusing or unclear rating levels, and are viewed as subjective and biased by staff (Mathis & Jackson, 2006). A study was undertaken to respond to this issue by identifying the steps involved in creating a pay-for-performance system for a public park and recreation agency. This case study (1) identified a systematic procedure for creating performance appraisal instruments, (2) described the appropriate training necessary for those conducting a performance appraisal interview, (3) implemented the performance reviews using the developed instruments and the results of the appraisal training, and (4) determined how much of a merit increase is to be given for different levels of performance. Emergent themes from focus group interviews with employees identified differences between employee attitudes toward the original payfor-performance system and the newly developed system, highlighting the value of employee participation in the development of the appraisal system. Results of the case study are analyzed and discussed.?