US Companies Altering, Canceling Performance Reviews In Response To Pandemic

Corporate performance reviews have changed drastically since the emergence of the COVID-19 pandemic.

Goldman Sachs and Anheuser-Busch InBev, among other companies, are seeking to make these evaluations more streamlined and transparent. Their measures are expected to make life easier for both workers and their managers.

Some firms are even scuttling reviews entirely for the time being.

Christine Carrillo, the chief executive officer of Butlr Health, a small online firm that links people to therapists, told the Washington Post that her company will actually cancel job performance reviews this year and maybe next year, as well.

“The added pressure and unnecessary stress given to reviews right now with everything else -- it just feels like a waste of time,” she said.

As an alternative, Carrillo meets informally with her seven employees biweekly.

Given that many employees are working from home – some of whom may never return to a traditional office setting – it’s unclear when formal job performance reviews will ever come back.

“I’m always an advocate for removing things if they don’t work,” Carrillo said. “If we don’t have [performance reviews] next year and that goes well, we might not add it back.”

Other experts are concerned about how the upheaval wrought by the coronavirus crisis will impact some employees, especially working mothers, and how they are evaluated.

“The pandemic has unleashed an enormous shock, but that’s not getting reflected in the way so many companies are thinking about performance reviews,” said Marianne Cooper, a senior research scholar at the Stanford VMWare Women’s Leadership Innovation Lab.

A survey of more than 317 employers by McKinsey & Co. and LeanIn.org, found that 30% of companies have altered their performance evaluations to compensate for difficulties arising from the coronavirus and 5% had either cancelled or postponed reviews. Another survey by Aon, a consulting and insurance firm, of 1,330 human resources officials, found that almost half (47%) changed their employees’ performance goals or may do so.

Cooper of Stanford emphasized that working mothers – facing increased child care responsibilities and work-related demands – are especially vulnerable now to corporate policy changes.

“Mothers are… more than twice as likely as fathers to worry that their [job] performance is being judged negatively because of their caregiving responsibilities,” she wrote.

One woman, a company vice president, said in the McKinsey report: “I… worry that my performance is being judged because I’m caring for my children. If I step away from my virtual desk and I miss a call, are they going to wonder where I am? I feel that I need to always be ‘on’ and ready to respond instantly to whatever comes in. And if that’s not happening, then that’s going to reflect poorly on my performance.”

Tech companies have already changed performance reviews in various ways in response to the challenges caused by the virus. In the first half of the year, Facebook (FB) did not even hand out individual performance ratings – but will resume the practice for the second half of 2020.

Alphabet (GOOG) unit Google combined its two review periods into one this fall.

“The dynamics of today’s challenges underscore the need for more transparency [in performance reviews],” Goldman Sachs CEO David Solomon wrote in a memo.

At the giant investment bank, managers will meet with their staff three times a year to spell out goals and expectations.

Some experts think remote evaluations might be better for all parties involved.

“If more people are working remotely, they will be checking in weekly with their managers and I think it could diminish the need for the annual performance review,” said Brooke Green, a partner and leader of employee rewards and talent consulting at Aon.

Josh Bersin, a human resources analyst, said the virus has forced companies to simplify what was typically a time-consuming, cumbersome process.

“All those hours spent talking in conference rooms -- we don’t have time for any of that,” he said. “For all the years I’ve been studying this, everyone has been trying to simplify performance management. Now they’re doing it because they have to.”

For example, at Anheuser-Busch InBev, job performance reviews once took up to six months to complete. Anheuser-Busch InBev now seeks to shorten the process to 2.5 months.