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January 28, 2010
Pros, Cons of Changing Performance Appraisals and Raise Schedules

In a BLR webinar entitled "Where's My Raise? How to Handle Tough Pay Conversations With Employees," Theresa Murphy of HR Partner Advantage and David Wudkyka of Westminster Associates reported that some U.S. employers are considering a change in their schedules for issuing performance appraisals and raises. By delaying reviews and raises past their normal annual time frames, they believe, economic conditions may improve to the point that they can issue higher-than-expected raises to their employees.

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For example, instead of offering its usual midsummer appraisals and pay raises tied to the July-June fiscal year calendar, an organization might consider delaying those events until November or December and tell workers the reason for the delay.

You should proceed with caution if you're considering changing the traditional time frame for your reviews and raises, however. Many workers may not appreciate the delay, arguing that they deserve whatever raises you can offer at the usual review times. Also, you risk the appearance of being inconsistent in your compensation policies, and you could face negative fallout if you arrive at the new raise time only to discover the economy hasn't improved substantially.

Theresa Murphy is the principal consultant for HR Partner Advantage, an independent human resources advisory firm based in Raleigh, N.C. She may be contacted at tmurphy@hrpartneradvantage.com. David Wudyka is the founder and managing principal of Westminster Associates, a Massachusetts-based human resource and compensation firm that specializes in pay, performance and productivity issues. He may be contacted at dwudyka@westminsterassociates.com .

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