New ratings

The new approach gives a positive framework to support people to develop and contribute to the best of their ability. There are two key parts to the new framework: The deal which sets out roles and responsibilities and a new set of performance ratings and descriptors. The new ratings are Excellent, Very Good, Achieves Standards, Development Needed and Unsatisfactory.

The booklet is available by clicking on the link on the right hand side of the page and we would urge everyone to take time to read it.

The booklet is clear that BT will not force a predetermined distribution of markings or set targets for managed exits.

Setting standards up front

There is much more emphasis on setting expected standards so people are clear about what is expected from the start of the performance cycle. So the first change people should see is more time being spent on setting and communicating standards. This should be taking place during April 2010 so standards are in place for the new DPR year.

In time a new cycle should develop:

• Set standards
• Perform
• Review performance against standards and peer group
• Review standards and revise for next period if necessary

Revised standards will not be applied retrospectively.

Levelling

The booklet contains detailed guidance on levelling. Levelling should be about ensuring fairness and consistency in assessment against standards, checking assessments across a peer group and resetting standards for the next cycle. It should also check that ratings reflect team and unit performance. Levelling should not be used to fit ratings to a predetermined outcome or to impose quotas. Any changes to ratings arising out of levelling must be evidence based and a record of the decisions and reasons must also be kept.

Relative Performance

As part of the levelling process an individual's performance will be compared with their peer group. The peer group should be individuals working on similar roles and objectives. People should not be marked down solely on the basis of their relative performance. Where an individual has met the standards as set by his or her manager the rating will not be changed but the standards, if set too low, will be revised for the period going forward and communicated to the individual.

Emphasising development

Development Needed is not the new 'GS'. The Development Needed (DN) category is just that - a category where development needs are identified and addressed in a specific coaching and development plan. If, despite this support, there is evidence of declining performance then someone may be put on a formal Performance Improvement Plan but only if:

• Performance has deteriorated and is unsatisfactory against the standards set at the beginning of the performance cycle;
• the people manager has held a 121 with the individual to explain that performance in unsatisfactory; and
• an individual has been given reasonable time to improve.

As a reflection of the more positive approach individuals rated as 'development needed' will be eligible for a move into the BTTC unless there are other factors prohibiting this. Equally we do not expect individuals rated GS or DN to be excluded from pay reviews. This issue will be addressed further as part of the pay review discussions.

The agreement will be reviewed with the unions in six months. In the meantime if you see any potential abuses or misapplications of the agreement, please let us know immediately.

Transitional arrangements

Year end DPRs for the current cycle will use the existing performance categories ie Outstanding, Very Good, Good, Generally Satisfactory and Needs Improvement. However, the principles of no managed exits targets and no quotas or predetermined distributions of marks still apply. Additionally, individuals should only be put on a formal PIP if their performance has deteriorated and is unsatisfactory against the standards set at the beginning of the performance cycle; the people manager has held a 121 with the individual to explain that performance in unsatisfactory; and an individual has been given reasonable time to improve.

A more positive approach

The new agreement is the culmination of many hours of discussions. We believe it represents a step towards a new more positive approach to performance management which, if delivered, will contribute positively towards BT's future success and that of its employees.