Can Employees Claim Discrimination in Their Performance Evaluations?

Employee performance reviews are an integral part of a successful business. However, the process that employers use to evaluate employees must be objective and fair, or else it could result in a discrimination claim.

One example of alleged bias is the lawsuit recently brought against Yahoo by one of its former male editors.  The suit claims the company’s performance review process systematically favors women when it comes to firing, hiring, and promotions.

The action, filed in a California district court, claims that the editor was given low performance ratings and ultimately fired for complaining about the evaluation system, and for reporting that another employee had tried to bribe him to change someone else’s rating. The suit also alleges that Yahoo’s rating system has been used to fire hundreds of employees since 2012, and that Yahoo’s managers routinely manipulate employee ratings in order to discharge certain workers without just cause and handing out low rating to some employees on purpose, regardless of their actual performance.

While employers certainly need to evaluate their employees’ performance, the review system that is used must be non-discriminatory. Here are a few things to look for in determining whether an employer’s review process is fair.

Lack of Objectivity

In the lawsuit against Yahoo, the plaintiff compared the company’s review system to the “stack ranking” system that Microsoft Corp. and General Electric once used.

The stack ranking system incorporates a bell curve, and many companies have discontinued using it, the main reason being its subjective nature and the fact that personal opinions can be injected into the review. This had led to situations where older and minority workers have perceived they are being subjected to disparate treatment, which could support claims of age and racial discrimination.

Age discrimination can also come into play in other ways. For example, in performance categories that includes gray areas, such as whether an employee has innovative ideas, if an older worker scores low it could be viewed as age bias, leading to a possible disparate impact claim.

An evaluation process can also be overly arbitrary, in that it’s too subjective or able to be manipulated without clear justification. In these cases, it may be alleged the employer purposely treated someone outside a protected class more favorably.

Likewise, a disparate treatment claim can be pursued if it seems like one group of employees is getting raises or promotions for some nebulous reason, like leadership potential.

Absence of a Paper Trail

There are some aspects of employee performance, such as writing ability or the quality of a presentation, that are indeed inherently subjective.

In these instances, if an employee is truly performing below acceptable standards, there should be documentation of the employee’s actions and concrete examples in the evaluation. This way, there is a record of whether an adverse personnel action may have been made taken for discriminatory purposes.

Good Communication

There must always be clear and appropriate communication between managers and employees. For example, a manager giving a performance review with a constructive tone can mean the difference between an employee perceiving the results as fair or viewing them as being discriminatory. Managers also need to talk with employees up front about what’s expected of them, and the parameters of the evaluation need to be understood by the employee.

If you believe that you are a victim of discrimination during a performance evaluation, contact Sommers Schwartz’s Employment Litigation Group today.

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