Effect of Performance Appraisal System on Employee Satisfaction in Budget Hotels of Kolkata

1. Introduction

Employees are an integral part of any organizations and their success and sustainability depends on the service rendered to the guest (Biswakarma, 2017). The hotel industry has been effected deeply by employee turnover. The HR policies and practices have a significant impact on their intention to stay. The HR department should work towards enhancing the satisfaction levels of the employees, which has a cascading effect on their loyalty and commitment towards the organization. Numerous studies have pointed that Performance Appraisal System are critical for employee job satisfaction. The outcome of performance appraisal affects the employee career paths in terms of salary and promotions. Employee expect their hard work to be recognized and acknowledged by the employers. Performance appraisal system which are fair and transparent motivates employees to increase their productivity levels. The purpose of performance appraisal has a significant effect on the morale of the employee. According to (Deepa, 2014) the purpose of performance appraisal system are as follows:

• a)

  To provide performance feedback to employees

• b)

  To determine promotional opportunities

• c)

  To decide layoff or downsizing

• d)

  To encourage performance improvement

• e)

  To provide motivation for superior performance

• f)

  To set and measure goals

• g)

  Counselling poor performers

• h)

  To determine changes in salary structure

• i)

  Encouraging coaching and mentoring employees

• j)

  Supporting manpower planning or succession planning

• k)

  Defining employee training and development needs

• l)

  Improving overall organizational performance

The present study has been conducted in the budget hotels of Kolkata. In the last decade a there has been an unprecedented growth of budget hotels in India, and specifically in Kolkata. Kolkata, is the largest city in eastern India and has been on the radar for investment. The Indian middle class’s growing purchasing power and investment of multinational companies to cater to this demographics’ needs has brought budget hotels into the forefront. The demand for human resource for this segment has been on the rise and HR have devised strategies to have productive and quality manpower.

The study was conducted in five budget hotels of Kolkata and the respondents were the permanent and contractual employees. The sample size of the respondents was 135 and 10 employers (HR managers and Departmental Heads) were taken for the study.

2. Review Of Literature

(Biswakarma, 2015) opined that human resource management is the function performed in organizations that facilitates the effective use of employees to achieve organizational as well as individual goals

A lot of studies on the relationship of performance appraisal system and employee satisfaction has been researched extensively (Keeping, 2000) and mostly three methods are used to conceptualize this relationship(a) satisfaction with performance appraisal interview, (b) satisfaction with the performance appraisal system and (c) satisfaction with ratings of performance appraisal process (Pettijohn, 2000).