Performance Appraisal is evaluating an employee’s current and /or past performance relative

to his or her performance.

In many organizations, appraisal results are used either directly or indirectly to help
determine the reward items. That is the appraisal results are used to identify the better
performing employees who would get most of the available merit pay increases, bonus and
promotions.
By the same token appraisal results are used to identify those who have not performed up to
the standards and need counselling, training and mentoring.

Methods and practices adopted in Public sector Which Effects

Performance of Individual Employee and Organizations:
1. Two-Way Communication - In government organizations two- way communications are
not followed properly by Senior and Juniors employee. They follow procedure from
establishment department to administration department then the issue goes to Senior Officer
then appropriate person. In this communication it will take long time and it may also not
reach the appropriate person. In case if communication with the aggrieved employee received
the reply for the issues submitted earlier, She/he might not be in position to correlate the
matters submitted by him earlier.
2. Feedback System - In government organizations are very poorly adopted. They hardly
follow the feedback system. Here there is only grading system followed depending on length
of the services by employees in government service will be criteria.
2. Packages & Perks - Packages & Perks are given based on qualification, experience and
designation. Government follow pay scale procedure thus salaries or compensations are
credited periodically. Packages & Perks increments are followed regularly on the norms of
government policies. Increment policies are usually made on the pay commission
recommendations.
Example: The present pay scale system of faculty members is as per 6th pay commission.
Recently 6th pay commission has been upwardly awarded to 7th pay commission According
to policies of government monthly provident fund is applied where 12% monthly salary of
employee will get deducted and deposited with organisation and to the same monthly PF firm
also deposit 1/3 of fund to particular employees and at the end of the services or after
resigning within 40 days the amount will be refunded to the employee’s savings account.
3. Recruitment and Selection - Recruitment and Selection is based on entrance examination
conducted by State Government or Central Government where candidate should get
minimum marks to get pass out then there will be an interview call from the officials for the
eligible candidates then after interviewing the best of them will get selected. Before applying
for any employment, he/she must have registered their name in the office of employment
exchange of the concerned city of domicile also valid registration. It is painful to note that for
services in the government for an employment is on gratification which is a de-motivating
factor to a highly qualified job seeker.
4. Employee Benefit - Employee Benefits in government organisations as such there are no
policy of benefits followed because government sector follows policies and norms of
Government of state or central.
5. Leave Management System - Government employees comparatively get more leaves
according to policies of government i,e 16 different kinds of leaves.
 Earned Leave: Earned Leave is ‘earned’ by duty. The credit for earn leave will awarded at a
rate of 15 days on the 1st of January and 1st of July every year.
 Half Pay Leave: All Government servants are entitled to 20 days of HPL for every
completed year of service. Half pay leave is calculated at 20 days for each completed year of
service.
 Commuted Leave: This Leave is granted on medical certificate normally. Commuted leave
not exceeding half the amount of half-pay leave due can be taken on medical certificate.
 Leave Not Due: This Leave is also granted on medical certificate normally. Leave not due
is granted when there is no half-pay leave at credit and the employee requests for the grant of
Leave Not Due.
6. Pension Plan - According to United Nations Population Division World's life expectancy
is expected to reach 75 years by 2050 from present level of 65 years. The better health and
sanitation conditions in India have increased the life span. As a result, number of post-
retirement years increases. Thus, rising cost of living, inflation and life expectancy make
retirement planning essential part of today's life. To provide social security to more citizens
the Government of India has started the National Pension System.

Steps in Performance Appraisal:

During effective Performance appraisal in following steps should kept in the mind:
1. Select what performance data to collect
2. Determine who conducts the appraisal
3. Decide on a rating philosophy
4. Overcome rating deficiencies
5. Create a rating instrument
6. Deliver useful information to employees
The “Performance Appraisal” or review is essentially an opportunity for the individual and
those concerned with their performance in the bank, most usually their line manager - to get
together to engage in a dialogue about the individual’s performance, development and the
support required from the manager. It should not be a top down process or an opportunity for
one person to ask questions and the other to reply. It should be a free-flowing conversation in
which a range of views are exchanged.
Performance appraisal procedure in Public Sector Banks:
Banking services is one sector where a great degree of attention is being paid to Performance
Appraisal Systems. Several of the public sector banks (PSBs) have changed their PAS or are
in the process of changing them.
State Bank of India has recently adopted an open system of appraisal. Several banks also
have self-appraisal as a part of performance appraisal, although mostly such self-appraisal is
more of communication of achievements. Looking into this, Allahabad Bank has introduced a
system that aims in helping officers to identify their strengths and weaknesses and encourage
improvement of performance on the job. Indian Overseas Bank has a system in which a
branch manager gives a self-appraisal on business growth, customer service, internal
administration and training requirements in detail. Union Bank of India has an appraisal
system in which the reporting officer is required to assess each of his appraisee officers on
technical skills, human skills and conceptual skills. All these are defined for different
categories of roles and the assessment must be made on a five-point scale. Corporation Bank,
UCO Bank, Central Bank of India, Dena Bank and Bank of Baroda has introduced similar
self-appraisal formats. Punjab National Bank has, primarily, a development-oriented
appraisal form. There are ten different formats available for ten different categories of
employees. The bank started the system with a self-appraisal by the appraisee. Studies of the
operating system of the successful organizations, in general, reveal that a good PAS is the
corner stone to navigate an organization successfully in this globalize environment of
uncertainty and continuous change. They have, therefore, developed and employed such
system and harnessing maximum benefits. But, like many fields of organizational
development, the PSBs are lagging in this area too. Most of the PSBs have an Annual
Appraisal System that is historic in nature and documents the past activities. It is a onetime
annual affair only. Study of the format of annual appraisal of many of the PSBs reveal that
they are basically uniform in character with emphasising historical events and little or no
importance for future growth. In comparison with the new generation banks and progressive
organizations, the appraisal system in PSBs, thus, is basically dysfunctional. The PAS, as an
important component of Performance Management System, is yet to be conceived and made
operational. But developing and implementing a PAS seems overdue and vitally important.