1. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Conference „Enhancing the effectiveness and efficiency of the civil service through performance appraisal“ Performance appraisal in the civil service: An overview of practices Airi Alakivi Senior Adviser, OECD/SIGMA Baku, 10 October 2012

2. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Topics  OECD/SIGMA’s way of work in strengthening public governance  Objectives of performance appraisal  Practices of performance appraisal  Common challenges and trends in performance appraisal of civil servants

3. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION OECD/SIGMA’s way of work in strengthening public governance  There is no acquis communautaire on public administration and civil service issues in the European Union  There are European Principles for Public Administration (OECD/SIGMA 1999), a guiding concept for the reform of civil service in accession states  OECD/SIGMA is a joint initiative of the EU and the OECD, working with countries in transition (EU candidate countries and European Neighbourhood countries) to promote and strengthen public governance systems and capacities of people working in working in public administrations, in five key areas:  Legal framework and civil service management  Public finance management  Public procurement  Policy making and co-ordination  Strategy and reform.

4. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Why performance appraisal?  Efficiency and effectiveness in government’s performance depend on the talent of civil servants and the quality of their knowledge and skills; therefore, the state is responsible for ensuring the efficient, professional and impartial performance of the public administration through establishing adequate management standards and tools of HRM, incl. performance appraisal  A professional and well-functional civil service supports economic recovery and growth, helps to sustain good policy making and service delivery, and accountability and responsibility in utilising public resources

5. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Objective of performance appraisal  Performance appraisal is means by which  performance of a civil servant is assessed against a set of predefined criteria with which an individual fulfils an agreed set of tasks and objectives (focus on delivery)  needs for training and development of new knowledge and skills are identified  clear targets and responsibilities for the next period are agreed  good performance are rewarded, e.g. with career development, performance-related pay  levels of professional competences are evaluated (by 180-360º feedback) and development needs defined

6. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (1)  Performance appraisal has been introduced in civil service laws in most EU and OECD countries  General principles in the law, detailed regulations and procedures in the secondary legislation  Decentralised implementation  No universal performance criteria for civil servants  No static conceptions of performance evaluation

7. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (2)  Who is evaluated?  All categories of civil servants  What are the most frequent appraisal criteria?  Degree of achievement of agreed targets  Levels of professional competences (knowledge, skills, values)  Who carries out the evaluation?  Immediate superior  (in the case of 360º feedback also civil servant him/herself, immediate subordinates and colleagues)  How is the evaluation performed?  Once in a year (twice in a year) – performance conversation according to the regulations and methodological guidelines

8. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (3) Objectives U.K. 1985 (2002) - to promote the delivery of high quality but affordable public services, and rewarding good performance and penalising bad performance - to increase transparency - to improve pay practices Denmark 1987 (2002) - to retain high-qualified employees and compensate civil servants for hard working conditions - to strengthen the link between pay and performance, and objectives of ind. institutions France 2002 - to acknowledge and reward individual merit and performance of civil servants - to simplify the structure of the pay system, making it more coherent and flexible - to facilitate civil servants’ mobility Lithuania 2002 - to assess professional qualification and competences to perform the activities set in the job descriptions, and to link the results to remuneration and promotion opportunities - (for the heads of institutions:) to assess professional qualification and competences to perform the activities set in the job description, and capacity to implement the institutional strategies and achieve its goals Slovenia 2002 - to foster careers of civil servants and the adequacy of the decisions on their promotion Portugal 2004 - to improve the quality of public services - to increase civil servants’ accountability, differentiate performance levels and reward merit - to improve the quality of team work and leadership - to help identify training needs and mobility opportunities

9. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (4) Criteria for appraisal U.K.- the level of achievement of professional targets - specific set of professional competences based on a competency framework, e.g. ability to solve problems and make decisions, leadership, incentive and development skills, communication and cooperation skills etc. Denmark- appraisals are based on a dialogue between the employee and the line manager - adaptations of balanced scorecard, individual targets linked to the institutional objectives France- professionalism and technical skills - organisational and professional results - personal qualities and interpersonal skills Lithuania- for career civil servants: productivity, competence and quality of performance - for heads of institutions: achievement of the strategic goals, management and leadership skills Slovenia- professional results - independence, creativity and accuracy in the performance of professional work - reliability in the performance of work - quality of cooperation and organisation - other skills related to the performance of work Portugal- civil servants contribution to the achievement of the agreed targets and outputs - behavioural skills - personal attitude, efforts and commitment

10. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (5) Examples of indicators on which appraisal is based U.K.- percentage of achievement of agreed targets (usually a small number of agreed targets, most commonly 4–8). Target rates are frequently used to link the appraisal system to PRP. Denmark- some institutions use adaptations of balanced scorecards – civil servants’ individual targets are normally linked to the institutional objectives –, however rating is usually informal France- there is a cascade of performance agreements from the political level to the senior civil servants and downwards, the strategic and operational objectives being translated into performance targets and indicators Lithuania- indicators that are helping to assess the adopted criteria for performance, i.e. productivity, competence, quality of performance Slovenia- percentage of achievement of agreed targets Portugal- percentage of achievement of agreed targets (a global mark for all agreed targets is calculated, using specific weights) - appraisal marks of attitudes, based on standardised qualitative descriptions of the 1–5 quality levels of professional attitudes

11. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (6) Frequency of appraisal U.K.- usually annually - in some cases more frequent “monitoring-oriented” appraisals (mid-year review, quarterly review meetings) are also performed Denmark- once a year France- once a year Lithuania- once a year - extraordinary appraisals are possible Slovenia- once a year Portugal- once a year

12. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (7) Who evaluates the civil servants? U.K.- the immediate superior plays a key role in the performance appraisal (cacading from the Secretary General downwards) - room is also left for self-assessment - for the allowance of PRP or bonuses for good performance, Pay Committees have usually the final word Denmark- the appraisal is carried out jointly by the line manager and the concerned civil servant France- the appraisal is performed by the immediate superior and the civil servant him/herself - in order to ensure a coherent and transparent implementation of PRP, managers has to be trained on performance appraisal Lithuania- the appraisal is carried out by the immediate superior (of a career civil servant) or by the appointing authority (of a head of an institution) Slovenia- the appraisal is carried out by the immediate superior of the civil servant, using specific evaluation forms in order to substantiate the results of the appraisals Portugal- the line manager (or the person who has responsibility for the supervision of the civil servant’s work) plays the key role in the appraisal - the system also integrates self-assessment and intervention of top manager of the concerned institution and advisory unit for the coordination of appraisal (CCA)

13. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (8) What are the usual procedures? U.K.Procedures are quite diverse for senior civil servants/SCS (ca 4000) and other civil servants (ca 505 000): - detailed methodological guides for performance management and reward in the SCS adopted by the Cabinet Office - performance appraisal procedures for other civil servants decided at the institutional level DenmarkMinistry of Finance has designed a methodological tool to facilitate the annual interview, which includes a preparation guide, a conclusion form and a development plan form for civil servants France- performance and results achieved during the year are assessed against the set of agreed targets - results of the appraisal are formalised in a report prepared by the line manager and communicated to the civil servant Lithuania- immediate superior performs the appraisal, using a 4-level rating scale - result of the appraisal may lead to the award of a bonus, promotion, demotion or dismissal Slovenia- appraisal is performed by the line managers in form of an interview - civil servants are notified of their appraisal result within 30 days, if they agree, they confirm their agreement by signing the evaluation form Portugal- a standardised 1–5 rating scale is used - 5 steps have been instituted: self-assessment, previous assessment by the line manager, harmonisation and validation of the appraisal by the CCA, evaluation interview, homologation of the assessment results by the top manager

14. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Practices of performance appraisal (9) How are the appraisal procedures controlled? U.K.If civil servant does not agree with the results of an appraisal, he/she can request an interview with the evaluator, if the mark is not changed the civil servant can make a complaint all the way up to the managerial staff of the concerned authority. DenmarkNo formally instituted mechanisms to control the fairness of the appraisals. However, the system is based on transparency and mutual trust. As rules related to the PRP have been adopted in the collective agreement with the central employee’s organisations, the negotiation system in place offers union representatives the possibility to ensure that the appraisals are fair. FranceAdditional comments to the appraisal report, prepared by the line manager, by the employee, the line manager or the higher-level manager may be added, before the report is included in the civil servant’s administrative file. LithuaniaCivil servants who contest the results of the appraisals have right to appeal the appraisal decisions in accordance with a procedure set out by the Law on Administrative Proceedings SloveniaCivil servants disagreeing with the results of the appraisals may request, within 8 days after being notified, that the appraisal result to be re-examined by the commission. Portugal The fairness and coherence of the appraisals are expected to be controlled by the CCA during the appraisal process. Within 5 days from the notification of the appraisal results, civil servants may contest the result. In such cases, the top manager requests an advice from CCA, and within 15 days takes the final decision.

15. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Common challenges and trends  Simple systems  Clear and adequate methodological procedures  Mutual trust and clear communication of the appraisal criteria, expected outcomes and incentives  Flexibility in renegotiating objectives and targets when necessary  Adequate training  Linking good appraisal results to rewards, career development and enrichment +  Performance appraisal based on competency frameworks – how to define and assess the most crucial competencies for civil servants of today and tomorrow?

16. © OECD A joint initiative of the OECD and the European Union, principally financed by the EU EUROPEAN COMMISSION Thank you for your attention!