Avoid Legal Trouble When Giving Performance Evaluations

In any wrongful termination or employment discrimination lawsuit, one of the first things the employee's attorney will ask for are the employee's performance evaluations. The attorney is digging for that piece of evidence that will prove the employee's case or disprove the employer's defense. And, in some situations, that's exactly what the attorney will find.

It's amazing how many evaluations contain the proverbial smoking fun that makes an employee's case. Perhaps the evaluation uses biased terms or stereotypes, or maybe it directly contradicts the reasons the company now gives for terminating the employee. Whatever the legal pitfall, a manager who has a basic understanding of the law can avoid this type of trap.

Don't Destroy the At-Will Relationship

Most employees work on an at-will basis. This means they can quit at any time, for any reason, and you can fire them at any time, for any reason that isn't illegal. (Illegal reasons for termination include discrimination or retaliation.)

However, you can undo this basic principle by promising employees job security in some way. If enough statements are made indicating that an employee won't be fired, has job tenure, has a "long future" at the company, and so on, a court might decide that the employee has an implied contract of employment, by which the company must have good cause to termination the relationship. As you can see, these types of statements are often made in the course of evaluating an employee's work. If you stick to talking about the employee's performance – that is, how the employee has performed in the past and what goals and requirements you expect the employee to meet in the future – rather than making promises about what will happen, your evaluations won't compromise the at-will relationship.

Don't Undermine Potential Terminations

If you fire an employee, the employee's performance evaluations must support – or at the very least not contradict – the reason you give for the termination. And, because you can't go back and create evaluations after someone is fired, you must make sure that you write thorough, honest evaluations. If you anticipate trouble down the road for an employee, make sure your evaluation spells out the problem.

Of course, if there is nothing wrong with the employee's performance, then it's fine to write a glowing review. Just make sure that positive evaluations are earned, not the product of glossing over poor performance or misconduct.

Don't Harass or Discriminate

It should go without saying, but any sign of bias, stereotyping, or outright slurs in an evaluation is inappropriate and can lead to serious legal trouble. Sometimes, bias creeps into an evaluation through the application of stereotypes. Criticizing a female employee's assertiveness or an older employee's lack of energy or inability to master new technology, for example, will sound a lot like prejudice to a judge or jury.

To avoid these traps, focus on the facts and be specific. For example, you could say "John was charged with compiling several Xcel spreadsheets this quarter, but was late each time. He has had to ask coworkers for help using the program. One of his goals for next quarter is to enroll in a class in Xcel basics, so he can meet his spreadsheet deadlines." This is accurate and detailed; it will also sound a lot better later than "you can't teach an old dog new tricks."

Don't Retaliate

When an employee complains about discrimination, harassment, or another violation of a workplace law, or if the employee supports another employee's complaint, you must be especially careful. If you take any action that the employee might view as punishment for making the complaint – including giving the employee a negative performance evaluation because of the complaint – you might find yourself on the wrong end of a lawsuit. It is illegal to retaliate against an employee for complaining about discrimination or another violation of a workplace law to you, someone else in your company, or a government agency.

This doesn't mean you can't give an employee in this situation a negative evaluation if the employee's job performance warrants it. It does mean, however, that you should be prepared to back up your negative evaluation with documents and evidence supporting your assessment, particularly if they predate the employee's complaint.

Don't Forget to Document

If you carefully document employee performance throughout the year, you'll have the information you need to prepare an accurate, effective evaluation. You'll also have the evidence you need to rely on your evaluation in court, if it comes to that. Documentation shows that your evaluation – and any job decisions based on it, such as discipline or termination -- is grounded in objective, job-related facts, not illegal considerations such as discrimination or retaliation.