Many performance appraisal methods have been severely criticized. Many of the problems commonly mentioned are not inherent in the method but, rather, reflect improper usage.

a.       Lack of Objectivity: - A potential weakness of traditional methods of performance appraisal is that they lack objectivity. Some subjectivity will always exist in appraisal methods. However, the use of job-related factors does increase objectivity.

b.       Halo Error:-Occurs when the evaluator perceives one factor as being of paramount importance and gives a good or bad overall rating to an employee based on this factor.

c.        Leniency/Strictness:-The giving of undeserved high or low ratings.

d.       Central Tendency:-Occurs when employees are incorrectly rated near the average or middle of the scale.

e.       Recent Behavior Bias:-It is only natural to remember recent behavior more clearly than actions from the more distant past. However, performance appraisals generally cover a specified period of time, and an individual’s performance should be considered for the entire period.

f.         Personal Bias:-Supervisors doing performance appraisals may have biases related to their employees’ personal characteristics such as race, religion, gender, disability, or age group.

g.       Manipulating the Evaluation:-In some instances, supervisors control virtually every aspect of the appraisal process and are therefore in a position to manipulate the system.