What Is a Calibration Session & How Does It Work?

Performance review processes are critical for shaping employee careers, rewards, and the organizational culture. Yet if not managed correctly, their outcome can dramatically differ from department to department. A calibration session is a calibration process implemented within the HR function to ensure all ratings are consistent and to minimize any potential legal issues.

1.0 What is a calibration session?

A calibration session is a process in which managers, HR representatives, and company leaders review and calibrate the performance ratings of the employees in the department. These calibration meetings ensure every department has the same value for a "meets expectations" employee rating.

Element	Description
Purpose	To align performance ratings from departments and eliminate any inconsistencies in the application of those ratings.
Participants	Managers, HR representatives, and company leaders.
Output	The final, equitable performance ratings for the employees in the company.
Timing	After managers complete their performance rating for their employees and before the managers notify the employees of the ratings.
Common Tools	Tools Rating scales, nine box grids, calibration templates, and distribution models can be used during these sessions.

1.1 Why do companies use calibration sessions for performance reviews?

Companies use calibration sessions to ensure that all employees, including direct reports across every level of the organization, are on a level playing field.

When evaluating agent performance and the contributions of each team member, managers may unconsciously and subconsciously rate the performance of their employees based on their relationship with the employees or other factors that have nothing to do with the employees' actual performance.

The calibration forces all managers to use the same standard when evaluating employees, ensuring that everyone is evaluated fairly.

1.2 What are the 5 points of calibration?

High performing HR teams implement five points during performance calibration sessions for employees. These five points are as follows:

• Consistency of the ratings being applied to all departments.

• Differentiation between high performing, average, and poor performing employees within each department.

• Basis for checking for biases within the management teams.

• Presentation of evidence to back the performance ratings assigned to each employee.

• Alignment between employee performance and performance expectations with the outcomes that the company values.

Successful calibration sessions depend on objective data and clearly defined standards. CompAnalyst® helps organizations support those discussions with market benchmarks, compensation analytics, and salary structures that promote consistency and fairness across departments.

1.3 How does a calibration session reduce manager bias?

Managerial bias is a serious concern that can cloud the presentation of an accurate performance review of each team member. During the calibration, all managers must present the reasons for the performance ratings that they have assigned to the employees in their departments. A manager who rates all of their employees as high performing will have to present this to other managers in the room.

A study published in the Harvard Business Review found that more than 60 percent of an employee's rating within a performance review session can be the result of the tendencies of the manager to rate those employees.

2.0 What happens after a calibration session?

The performance rating of each employee will inform key decisions within the organization regarding that employee. The HR team will use these ratings to make decisions regarding compensation, promotions, and training for employees.

What happens after a successful calibration can include the following steps within the company:

1. The HR team finalizes the ratings and locks them into the HRIS software platform.

2. The company's compensation team will use the ratings to determine earned merit increases and bonuses.

3. The managers will use the performance ratings to have a performance conversation and schedule coaching sessions with each of their employees.

4. The HR department will use the performance ratings to identify high potential employees for training and development or succession planning within the company.

Organizations often need a structured way to translate calibrated performance ratings into actual pay decisions. CompXL® helps compensation teams automate merit increases, bonuses, commissions, and reward planning.

2.1 How do calibrated ratings connect to merit increases and compensation?

The performance ratings will determine the company's merit based pay for each employee. Most compensation structures use the performance rating of the employee as a factor in determining merit increases in salary, bonuses, or other forms of compensation.

2.2 How do you spot and fix rating inflation or compression?

Rating inflation is when the managers rate a high percentage of their team members as meeting the criteria for high performance ratings. Rating compression is the opposite; a percentage of the employees in a department are given the same performance rating. These both can impact the compensation and promotions for employees within that department.

Companies can spot and correct rating inflation and compression by taking the following steps:

1. Reviewing the performance of each department to spot inflation and compression.

2. Working with the managers of departments with inflated or compressed ratings to reassign performance ratings as necessary.

3. Using a guided distribution model to ensure a percentage of each department is given specific performance ratings.

4. Requiring that each manager provides examples of the performance of their employees to support any rating changes.

3.0 How to conduct a calibration session

Calibration sessions require preparation on the part of the HR team. HR teams that do not have supporting data to present at the session will likely find themselves in political discussions with the managers of the companies.

Some of the best practices for conducting a calibration session can include the following steps for the HR department:

1. Sharing the performance rating summaries with all management and HR staff at least three days prior to the session.

2. Establishing ground rules for the calibration to minimize conflicts between department managers.

3. Using a nine box grid to map out employees according to their performance level and potential.

4. Having a neutral facilitator to conduct and manage the calibration.

5. Documenting the decisions of the managers during the calibration.

The insights gained from tools like the nine box grid often guide employee development and succession planning. Elevate® gives employees and managers access to personalized information about compensation, rewards, and career paths.

3.1 What does a calibration facilitator actually do?

A calibration facilitator is responsible for helping organizations effectively manage calibration sessions from start to finish. The facilitator will make sure that all managers are participating in the session, as well as that all of the performance ratings submitted by each manager are supported by evidence.

3.2 How is the nine box grid used during calibration?

The nine box grid maps the performance of each employee according to two factors; the current level of their performance and their potential for future leadership roles within the company. Using the nine box grid, department managers can compare the performance of their employees to those outside of their departments.

3.3 Should you use forced ranking, guided distribution, or no curve?

There are pros and cons to each of these rating distribution methods that should be considered before use by the HR teams within the company.

Method	Pros	Cons
Forced ranking	Creates clear differentiation	Damages collaboration and morale
Guided distribution	Balances fairness with flexibility	Requires strong facilitation
No curve	Preserves full manager autonomy	High risk of rating inflation

Modern HR teams typically use guided distribution. The research study published in the Harvard Business Review that analyzed companies that utilized Deloitte found that the use of forced ranking models was associated with damaged employee relationships within the company.

4.0 FAQs

Here are the frequent questions about the topic:

4.1 How long should a calibration session last?

Calibration sessions can last between 90 minutes and three hours. Some companies hold these sessions over a few different days to accommodate managers from each department.

4.2 Who should attend a calibration session?

The managers of the employees, the HR representatives, and the company leaders should attend the calibration sessions. The employees themselves do not attend, and some companies include a representative for diversity and inclusion in their calibration.

4.3 How often should you hold calibration sessions?

Most companies hold calibration sessions once per year, when they evaluate the performance of each of their employees. Other companies that use a system of continuous performance management may conduct several calibration sessions throughout the year, calibrating their employees every quarter.

4.4 What is the difference between a calibration session and a performance review?

Performance reviews are the meetings between the manager and the employee in question. During these meetings, the manager communicates the employee's accomplishments during the review period and any other development goals for those employees.

Calibration sessions are the meetings held within the company between managers, HR representatives, and company leaders before the performance reviews between the managers and their employees.

During these sessions, the managers and HR representatives ensure that all performance ratings applied to the employees are consistent throughout the organization before the employees are made aware of those ratings.