Performance Review Policy
A ready-to-use Performance Review Policy covering good performance criteria, review cycles, rewards, and manager responsibilities, plus a free downloadable PDF.
Download Performance Review Policy Template
Table of Contents
What is a Performance Review Policy?
Done well, performance reviews help employees understand their strengths and weaknesses, see a path for working on those weaknesses through training, and get a clear sense of how their work ties into company goals and what's expected of them in their role. For managers, a good review system makes it easier to spot high performers, get ahead of problems before they grow, set clear expectations, and support both growth and engagement across the team.
A Performance Review Policy clears up the confusion around how reviews actually work, what criteria matter, and how often they happen. It gives employees and managers a shared structure for looking back at what was achieved, reviewing the work itself, and agreeing on what comes next.
Standard Performance Review Policy Format
Here's a sample Performance Review Policy you can adapt for your own organization:
[Company Name]'s Performance Review Policy describes the coaching, evaluation, and reward methods for our employees. Our performance management system is based on constructive feedback and open communication between managers and their teams.
Purpose
This policy is designed to:
- Make sure employees understand their job responsibilities
- Make sure employees have specific goals to meet
- Give employees fair, well-timed feedback on their work
- Invest in opportunities that help employees grow and develop professionally
- Recognize and reward employees' work in both monetary and non-monetary ways
Scope
This policy applies to all employees.
Definition of Good Performance
At [Company Name], we consider an employee's performance to be good when they meet their targets consistently, show a willingness to learn and develop, complete their duties as expected, have the right attitude, and follow the company's code of conduct.
An employee has good performance only if they meet a minimum standard across all of these criteria.
Cyclical Reviews
[Company Name] conducts performance reviews on a [quarterly, half-yearly, or yearly] basis. [Title of the Person] prepares the employee's performance evaluation report and arranges a meeting with the employee to discuss it.
In these discussions, [Title of the Person] recognizes employees who do their jobs well, talks about career options and motivation, and identifies areas for improvement.
Reward
Employees [are / are not] guaranteed increments or bonuses.
However, managers will recommend rewards for their team members when they've earned them. Employees will not be compared to each other on any basis.
Training
Training and development opportunities are available to all employees throughout the year. If a manager identifies a particular training need, it can be discussed in the performance review meeting.
More information on training is in the company's Employee Training Policy.
Responsibility of the Manager
A manager's responsibilities for the team's performance are to:
- Set transparent objectives
- Give constructive feedback
- Keep a record of each employee's performance
- Keep the team involved
Quick, Actionable Tips
- The purpose and scope of the policy.
- What counts as good performance.
- The provisions around rewards.
- How often the review cycle runs.
- The provisions around training.
- Management's responsibility toward the team's development.