Performance appraisals as a selection criterion in downsizing

Purpose – The primary purpose of this article is to examine two alternative approaches for the use of performance appraisals in selecting individuals out of the organization (i.e. to be laid off). A rank‐order approach and a banding approach are compared to provide insight regarding issues associated with each approach.Design/methodology/approach – Literature examining the status of downsizing as an organizational strategy, as well as some of the legal and practical considerations associated with the use of performance appraisals in downsizing decisions is reviewed as a precursor to an illustrated comparison of a rank‐order approach and banding approach to select individuals to be downsized. Actual performance appraisal scores for 106 individuals working in an organization were analyzed for the purposed of the comparative illustration.Findings – The illustrative comparison highlights specific issues associated with using two different approaches for selecting individuals for an organizational downsizing.R...