City failed to conduct performance evaluations for thousands of employees, inspector general says

Nearly half of the city’s 33,000 employees work in departments that either never evaluate performance or don’t conduct those evaluations regularly, leaving personnel decisions “vulnerable to appearances and suspicions of favoritism,” an internal audit concluded Wednesday.

Although annual performance evaluations are required, Inspector General Joe Ferguson concluded that the city’s Department of Human Resources is doing a poor job of following through on that mandate. Nor has the department “clearly defined the roles and responsibilities related” to conducting periodic evaluations.

That has left “more than 10,000” city employees working in seven departments that don’t conduct any performance evaluations, the audit concluded. Another 6,000 employees work in 13 departments that don’t evaluate the performance of all of their employees regularly.

Ferguson noted the wide disparity between departments that require annual, face-to-face employee evaluations.

The Department of Fleet and Facilities Management was credited with maintaining a monthly completion average of 83%. At the Chicago Police Department, only 490 out of 1,700 supervisors — 27.7% — received their 2018 performance evaluations by the due date, the audit states.

The inspector general argued there’s a good reason the city’s municipal code mandates regular employee evaluations. It’s the only fair and objective way to guarantee productivity and make objective personnel decisions, including salary increases, promotions or disciplinary actions.

“Without regular evaluations, city employees lack critical guidance and incentive for continual improvement in the execution of their duties for the public, as well as the support for professional growth and development a model employer owes them,” Ferguson wrote in a press release accompanying the audit.

“Their absence — which this audit reveals to be widespread — renders such decisions overly dependent on comparatively standard-less, unaccountable management discretion and vulnerable to appearances and suspicion of favoritism.”

Ferguson recommended strengthening personnel rules to “require performance evaluations for all city employees on, at least an annual basis” and “define expectations and responsibilities” for conducting those evaluations.

He further recommended annual reports to the mayor’s office on the compliance of each department and an “automated, real-time tracking system.”

Human Resources embraced virtually all the recommendations. That includes a promise to issue a “citywide performance evaluation policy requiring departments to designate the date of each employee’s annual evaluation and track on time completion rates.”

The audit exposing the city’s failure to conduct employee evaluations that are the norm in private industry comes at a sensitive time.

Mayor Lori Lightfoot has asked organized labor to work with her to identify $200 million in savings to erase a $1.2 billion shortfall.

The mayor has called employee layoffs her “second-to-last resort” — behind a property tax increase.

But without another round of federal stimulus funds to replace revenue lost to the coronavirus, Lightfoot may have little choice but to recommend both her “last resort” options. That is, unless union leaders agree to a “share-the-pain” plan that includes pay cuts or unpaid furlough days.

Ferguson’s warning about personnel decisions being open to at least the appearance of favoritism and politics has a familiar ring.

Former Mayor Richard M. Daley’s patronage chief, Streets and Sanitation commissioner and a handful of others were convicted of rigging city hiring to benefit the now-defunct Hispanic Democratic Organization and other pro-Daley armies of political workers.

Under former Mayor Rahm Emanuel, Chicago was released from the Shakman decree and the costly constraints of a federal hiring monitor — but only after the hiring scandal had cost Chicago taxpayers $22.9 million over the previous decade.

Those costs included: a $12 million fund created to compensate victims of the city’s rigged hiring system; $6.6 million for the hiring monitor; $1.8 million for consultants; $1.5 million for plaintiff’s counsel and $1 million for outside counsel.