How to create an employee performance review template

They always say employees are a business’s most important asset. They are also probably your largest business expense as well.

Getting the most out of employees is a fundamental principle of business success. Fail to do that and your profits would quickly evaporate.

Every business wants to keep track of their employees’ performances – without looking over their shoulders every minute of the day. You have to allow people to get on with their jobs. In business, this is often called ‘empowerment’.

But at the same time, you need to be sure they are doing what they are meant to. You need to know they have the right tools, training and guidance.

You also want to give them the opportunity to express their views about how their work is going.

That’s where an employee review template comes in. Probably the most common type is the year-end review template.

What is an employee review template?

An employee performance review template is a formal way for businesses to assess their staff. You don’t necessarily need an actual template. Probably a checklist of things to cover will be fine, especially for small business.

The employee performance review template has to be something you can use time and again. That way, you can be more consistent in your performance reviews.

At Checkatrade, we carry out regular vetting checks on our members, to make sure we only work with the best tradespeople. Think of an employee review as carrying out similar checks on people that work for you.

Who should be in charge of an employee review template?

If you are the business owner and don’t have a Human Resources team or person in charge of staff, then it’s probably down to you. If your business has teams with managers in charge of them, then it’s probably best that they are involved as well.

How often should you have an employee performance review?

That depends on various factors. These include the type of business you run and the number of employees you have.

Businesses usually carry out employee performance reviews:

• Quarterly
• Every six months
• Year-end review template

Sometimes, reviews need to be done more often, for example, when a job role changes or when you take on a new contract that involves new ways of working.

Be prepared

Both sides involved in a performance review should take a bit of time to prepare for them. With a bit of homework done in advance, everything that needs to be discussed should be covered.

A lack of preparation can make the review process disjointed. It could risk important points being missed.

Be relaxed

Running a performance review or being an employee on the receiving end isn’t always easy. Experts say the key is for everyone to feel relaxed.

There should be an atmosphere where both sides feel free to speak honestly and frankly. Otherwise, improvements to how a business runs are less likely to be identified.

The worst outcome would be if neither side is happy. That could be about the review as well as what was agreed for the next performance period.

Be positive

An employee performance review template should be balanced. As well as any criticism of the employee’s performance there should be positive comments and support. This will make it more likely they improve their performance during the next review period.

Why do I need an employee performance review template?

An employee performance review template delivers many benefits:

• Streamlines the employee performance review process
• Ensures a consistent approach is taken with all employees
• Allows employers to monitor and improve the performances of all employees
• Allows employers to check that employees are okay at work
• Helps employers to know when to step in with help, guidance and training quickly when required
• Provides an opportunity to make changes to how work is undertaken before things go wrong
• Can be used to recognise and reward staff when they have performed well

Without a performance review, employees are more likely to:

• Lack direction and motivation
• Be more frustrated about work
• Be less likely to achieve the work goals they have been set

With a performance review, employees are more likely to be more:

• Enthusiastic
• Motivated
• Happier
• Productive

What goes into an employee review template work?

You could divide the employee review template into different parts. Here are some ideas to create a review checklist:

Key facts

• Name of the employee
• Name of the person carrying out the review
• Date it was done
• Date of the previous performance review
• Once both sides have checked the review, they should sign it

Key measures of performance

There are lots of ways you can measure someone’s performance at work that could be included in a review template:

• Their attendance and absence record
• Their dependability and punctuality
• Training completed during the period and how it went
• Complaints against them, perhaps by other staff or customers
• Their use of tools and equipment, for example, if they damage them
• Any accidents or injuries that they have caused or been involved in
• Work productivity – did they complete all the tasks they needed to on time
• Quality of work – was it done to satisfactory standards, for example, meeting business, professional or legal requirements
• Consistency – was their work carried out to a a high standard every time

Personal assessment

This is where the person carrying out the review has to exercise their judgment. These areas are harder to measure. They include:

• Does the employee get on with colleagues?
• How do they interact with customers?
• Do they take the initiative when they need to?
• Are they good at working as part of a team?
• What are they like working on their own?
• Are they good at communicating with colleagues and customers?
• Are they are working to their full potential?
• Is anything holding them back (like a lack of training)?
• Do they need more motivation or more challenging work?

Two-way feedback

An employee performance review template ought to include comments from both sides. Don’t be afraid of encouraging employees to ‘tell it like it is’.

As an employer, you might not be involved in the day-to-day challenges and frustrations your staff face. This can make it difficult to understand what might affect their work performance.

With two-way feedback, an employer could learn a lot of useful information to improve the business.

The person doing the review could:

• Give their feedback about the employee
• Provide a brief update about how the business is doing and whether it is achieving its overall goals
• Talk about business plans for the future and how the employee fits in with them
• Encourage employees to talk about what they see as their own goals and targets working for the business

The employee could:

• Talk about how their work is going
• Say what they think about the business’s general performance and what it’s like working there
• Discuss the things that frustrate them at work and hold back their performance
• Say what they think works well in the business

Recommendations

Making recommendations at the end of the employee performance review is absolutely essential. You need to agree with the employee a list of actions and goals for the next review period.

Otherwise, the next review is unlikely to go well. The list of agreed actions can be checked off at the next employee performance review.

Recommendations could include:

• Employee performance targets and goals for the next performance review period
• Extra training required and when it will be undertaken
• A career development plan or a performance improvement plan

Useful techniques for an employee performance review template

Get SMART

One well-established business management technique for an employee performance review template covers these areas:

• Specific – What are the target areas for improving an employee’s performance?
• Measurable – Do you have the right methods in place to track the progress of an employee towards their work goals?
• Achievable – Does the employee know what they should be doing and agree that the work goals you set them can be attained?
• Realistic – Have you set reasonable performance goals for employees? Do they have what they need to achieve them?
• Time-related – Have you set realistic timeframes for achieving performance targets?

SWOT analysis

Another useful management process is to consider these areas when you review an employee’s performance:

• Strengths – What things is an employee good at and how can they be even better at them?
• Weaknesses – What things aren’t they so good at and what is needed to improve?
• Opportunities – Where can an employee improve their performance, for example, with training and qualifications or by doing different types of work
• Threats – What things might be holding back an employee or preventing them from doing the best possible job?

Key takeaways

• An employee performance review template is an essential way to measure how a staff member is doing
• Business productivity and profitability can improve with the use of an employee review template
• An employee review template helps businesses take a consistent approach to getting the most from staff and keeping them happy at work
• The employee performance review template includes measuring performance, assessing the employee’s progress, sharing views and making recommendations