What is a performance review and how do you prepare it?

A performance review provides clarity and direction for you and your employee. You discuss desired or achieved performance and can link a reward or improvement plan to it. The performance review is not mandatory. Read in this article what a performance review is and how it fits into a Human Resources, HR, cycle.

Obligations and more as an employer

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A performance review is the last meeting in the traditional HR cycle (in Dutch). You can distinguish 3 types of annual staff meetings within that cycle: the planning interview, the appraisal interview, and the performance review. You can also hold additional interim interviews. The traditional HR cycle is not the only way to shape your personnel policy. Choose a form that suits your business.

In the table below, read the characteristics of the conversation types

Type of meetingGoalTip1-sided or 2-sided
Planning meeting (in Dutch)

Setting objectives and plan

Record agreements in a Personal Development Plan (PDP) and personnel file (in Dutch)

 2-sided: employer does lead

Appraisal review (in Dutch)

Mid-term review and guide when necessary

Track progress in Personal Development Plan (PDP) and personnel file

2-sided: both have input

Interim interview

Informal catch-up

Track progress in Personal Development Plan (PDP) and personnel file

2-sided: both have input

Performance review

Employer reviews employee performance

Provide a written record of the assessment and agreements

1-sided; employer is leading

Purpose of performance review

In a performance review, you speak about the employee's performance. You can also include how a person fits into the organisation or works with colleagues. You can structure the conversation in a way that suits your business or your way of managing: formally or informally. In any case, both employer and employee share their opinions. For instance, an employee sends an overview of their performance or a self-reflection. The employer gives an appraisal during the review, including any consequences such as a salary increase, job modification or warning. Provide a written assessment and have it signed by you and your employee.

A performance review (beoordelingsgesprek) is often confused with an appraisal interview (functioneringsgesprek). But they are not the same. In an appraisal interview, you and your employee discuss how the employee is performing. You look back at the past period, but also at the future. There is room to guide the employee toward doing certain things better. In a performance review, your employee receives an assessment, a judgment over the past year. This conversation is only about the past and usually forms the basis for a contract extension, salary increase, promotion or an improvement plan.

How often is a performance review?

A performance review usually takes place once a year. For example, at the end of the calendar or contract year. It may be that a change in the work situation, such as a different position or team, calls for an extra performance review. You call this an interim assessment. You can also link a consequence to this interim assessment, such as a salary increase.

Preparation as an employer

Both employer and employee prepare for the performance review. For example, by using a form that you both fill in beforehand. In addition, use the following information about your employee as a basis for the performance review :

  • The job description. This includes, for example, which responsibilities and tasks your employee has.
  • Your employee's performance. Think about the results of projects or their sales figures. Check the report of the planning interview or a Personal Development Plan.
  • Feedback from colleagues and customers. Ask within your team how others work with the employee or look at reviews from customers. In addition, collect examples of behaviour you appreciate in your employee and formulate where you see opportunities for improvement.

Content of a performance review

In most businesses the employer's opinion is leading. Do give your employee space to ask questions during the review and express their opinions or wishes. You can think of the following content for the interview:

  • Achievements throughout the year
  • Improvements compared to last year
  • Motivation and commitment
  • Cooperation with colleagues
  • Training courses completed or certificates obtained
  • Suitability for the job
  • Desires for advancement

Assessment in personnel file

Draw up a report of the performance review. At the end of the conversation, there will be an overall assessment, which may include a reward. If they perform well, you can give your employee a pay rise, for example. Ask your employee to sign the assessment form after the interview and then sign it yourself. Keep the signed appraisal form in your employee's personnel file.
A written report is not mandatory, but it is wise. Should you or the employee become unclear about agreements, performance or opportunities for advancement, you can fall back on this performance report. Even in an industrial dispute or lawsuit, you can use the review report, when relevant, as file formation.

Not functioning properly

If the performance review is unsatisfactory, give the employee a chance to improve. Identify the areas for improvement and record them in the report. You are also obliged to offer your employee training to perform their job properly and consider reassignment to another position. After a period of improvement, does your employee still not meet the job requirements? Then, among other things, the assessment report and improvement plan serve as evidence when you want to dismiss that person.

Employee handbook

Do you have a employee handbook? Communicate in it to your employees how often and when you hold appraisals, what you discuss at these times and what the consequences might be. This will prevent ambiguities.