Raises All Around? Federal Agency Scraps Employee Rating System

Photo Credit: REUTERSAmerica’s new consumer watchdog agency has come up with a unique solution for its troubled employee-rating system: Give almost everyone a gold star.

The independent Consumer Financial Protection Bureau — created under the 2010 “Dodd-Frank” financial industry overhaul to serve as a consumer watchdog — says it’s scrapping its system of employee ratings in response to concerns that it was discriminatory.

That rating system assigned workers a score of between one and five. Due to concerns with the system, everyone who scored a three or above, regardless of performance, will now be getting the top rating of five — along with the corresponding retroactive pay raises that the top rating brings.

Those raises will likely cost more than $5 million, according to the American Banker, which first reported on the ratings troubles in a March 6 article.

Going forward, the bureau is looking at using a new two-tiered rating system for at least two years while officials evaluate the old system.