The appraisal system is common feature in most of the financial institutions. It is a yearly and sometimes bi-yearly opportunity for your employer to provide a formal and meaningful report on whether you have met expected standards, and what areas require improvement. Appraisals are therefore a good thing – right? Well, not always.

How does an employer provide a genuine appraisal where, for example, your line manager has a fundamental personality clash with you? It happens. Also, there are many instances where the line manager does not pull all the relevant information from other departments in respect of the employee's work for that year, and marks the employee down accordingly.

In these circumstances, an employee could justifiably argue that the appraisal was not balanced and was therefore unfair.

Appeals and grievances

But what can you do to challenge an appraisal, and why is it important to do so? It is good practice that you be given the right of appeal in relation to your appraisal, although this is not a statutory right. But you can also lodge an internal grievance – your employer has a period of 28 days to carry out an investigatation (usually by someone higher up the hierarchy than your own line manager). The grievance process is a statutory right.

The reason why you should always lodge a grievance if you have one is that if you are constantly marked down in your appraisal, it could be a prelude to being put on a performance improvement plan (PIP). In turn, this could lead to dismissal for reasons of capability – a fair reason under the employment legislation.

I have seen many distraught employees on a PIP and it is not long before the trust and confidence the employee has in the employer dissipates completely.

Performance as criteria for redundancy

Another reason why it is important to challenge the unfair appraisal is that in these turbulent times where there are large-scale redundancies, one of the main selection criteria for choosing one person to be made redundant over another is 'performance'.

This is when the appraisal system comes into its own. If inaccurate or unfair appraisals are left unchallenged, an employee will find it difficult to cry foul play when they are used to select him for redundancy over his peers.

Justification and constructive dismissal

Employers do need to be careful, however. An obviously unfair appraisal with detrimental comments against the employee could entitle the employee to claim constructive dismissal – in other words, to claim that he was forced out.

Such a claim can often be supported by the fact that appraisals in previous years have been good, and that there was no justification for a sudden departure from previous high scores.

A change in line manager can often lead to a low appraisal where the employee previously scored highly (for example, the new line manager may not have the outgoing manager's rapport with, or admiration for, the individual concerned). This circumstance should strengthen an employee’s claim but, as always, it is best to obtain professional advice before taking the draconian step of resigning your well paid job – or, at the very least, try to negotiate an exit package. Employers can be receptive to such a request where there is an obvious impasse.

Philip Landau is a partner at London law firm Landau Zeffert Weir.