Mekonnen, Worku (PhD)Mekonnen, Solomon2018-07-232023-11-042018-07-232023-11-042016-06http://etd.aau.edu.et/handle/123456789/9793This study tried to assess the practice of employees’ performance appraisal in Abay Bank S.C. The researcher has used descriptive research method. The data collection tools were interview and questionnaire. Total of 191 employees have been taken as a sample and the response rate was 96.33%. The researcher has used proportionate stratified sampling method. 22, 151 and 18 questionnaires were distributed among non-clerical, clerical and management employees respectively. The study found out that Abay Bank uses PA to measure employees’ job performance on January and July. The bank does not follow formal appraisal process and the performance standards of the bank addresses issues such as quantity, quality, timelines, cost effectiveness and strategic relevance but it fails to address stability or consistency or the extent to which individuals tend to maintain certain level of performance over time. Abay Bank also faces huge problems on its performance appraisal practice, most of them are rater’s error like recency, halo/horns, situational influence etc and the remaining is the problem of the system. The HR department of the bank takes the ultimate responsibility for appraisal and supervisors take the lion share by filling appraisal forms for most of the employees. The appraisal result in Abay Bank used only for making promotion, bonus payment and annual increment decisions. Performance review discussion does not take place in the case company unless an employee comes up with grievances. Generally the outcome of the research confirmed that the performance appraisal practice of Abay Bank S.C. has problems and weaknesses that need to be improved. Since it needs improvement, possible recommendations are outlined at the end of this report.enHuman ResourceThesis