Highlight on employees’ appraisals

Author:

Joël Grangé
Flichy Grangé Avocats
Paris

Appraisals have acquired over the years a crucial role in the employment relationship. The methods used are varied and depend on the HR policy in use within a company. They can take the classic form of a meeting with the manager or involve more sophisticated methods such as 360-degree (a system by which the employees assess the performance of their managers) or ranking (a system which ranks employees into categories according to their performance, ranging from relatively low to high).

Taking into account the increasing role of appraisals in the employment relationship, the French Labour code and recent case-law decisions have established several principles to control the development of such techniques. Specific procedural rules should be complied with for appraisals to be valid. In addition, French case law has set up a balance between the employer's right to assess his employees' skills and the requirements of the French labour code according to which such techniques should be pertinent to the intended purpose of the appraisals.

Procedural rules

First of all, the employer has a transparency obligation with respect to his employees under which he must inform them of the methods and techniques of appraisals before their implementation (article L. 1222-3 paragraph 1 of the French Labour Code).The French Data Protection Authority (CNIL) and the French Supreme Court in a decision of 2001 (Supreme Court, October 23 2001, n°99-44.215) ruled that employees should be able to see data concerning their appraisals, and that the refusal of the employer to communicate such data would constitute a discrimination.

Secondly, when the support used in an appraisal is a written document, which is computerised and will be retained by the employer in an organised way, it must be declared to the CNIL.

Finally, the role of the employees' representatives has been strengthened.

As appraisals constitute a tool for monitoring employees' activity, French employers must not forget to inform and consult their works council before the implementation of appraisal methods and techniques (Supreme Court, April 10 2008, n°06-45.741). This being said, the works council's opinion is not binding on the employer, who will be able to implement his appraisal system despite a negative opinion.

In addition to the traditional role of the works council, French employers now have the obligation to inform and consult the health, safety and working conditions committee when it is considered that the appraisals will exert psychological pressure on employees, impacting their work conditions (Supreme Court, November 28 2007, n°06-21.964). Even though the French Supreme Court has stressed that the necessity to consult the health and safety committee should be assessed on a case-by-case basis, depending on the circumstances of the case, in practice the consultation of such representative body is quasi-systematic.

When consulting the health and safety committee, employers should bear in mind that it has the possibility to appoint an expert, notably in case of the implementation of an important project modifying the health and safety or work conditions of employees (article L. 4614-12 of the French Labour Code). If such a scenario occurs, the expert will assess the impact of the appraisal system on the mental health of employees. It is always possible to challenge the appointment of an expert, but case-law decisions tend to recognise that the implementation of appraisals constitutes an important project modifying the health and safety of employees, thus justifying the appointment of an expert.

From a practical point of view, the consultation of the health and safety committee should take place before the consultation of the works council. The procedure will be longer in case the health and safety committee decides to appoint an expert.

Conditions of validity

When an employer wants to introduce appraisals, he must comply with the following principles:

• The information collected should only aim at assessing the employee's skills and have a direct and necessary link with the assessment of his/her work abilities (article L. 1222-2 of the French Labour Code);
• The methods and techniques of assessment of the employees' skills must be pertinent to the objective sought (article L. 1222-3 of the French Labour Code); and
• The criteria used must be objective (French Supreme Court April 9 2002, n°99-44.534).

The French Courts strictly control the application of such principles when assessing the validity of appraisal techniques and methods.

Despite several criticisms of such techniques, the validity of ranking systems was acknowledged by the Court of Appeal of Grenoble in 2002 taking into account the fact that they responded to a perspective of permanent adaptation of the staff to the company's requirements, through specific training (Court of Appeal Grenoble, November 12 2002, n°02/02794). Moreover, in this particular case, ranking was mainly designed to distribute bonuses among the employees.

Recently, certain employers have put in place appraisal systems which are not only based on the employees' results but also on the way they achieve the results. The possibility of using this kind of behavioural criteria is highly debated. Some consider that these criteria are linked to the personality of employees and introduce subjectivity which is not acceptable. Others argue that for certain job positions, behavioural criteria cannot be avoided and it is difficult, for the vast majority of employees whose work cannot be quantifiable, to use concrete criteria. The French Supreme Court has not yet ruled on this issue and the decisions of the first instance courts are, for the time being, not consistent. The main recommendation one can give is to specify behavioural criteria which relate to the position held by the employees (for instance, requiring a manager to better communicate with his team) and illustrate them by specific examples.

Finally, employers should make methods of appraisals as objective as possible. For instance, employees should have the possibility of appealing the result of their appraisals. In addition, it is preferable that the direct manager of the employee should not be the only person involved in the appraisal.