Foster psychological safety during year-end reviews by empowering employees to speak up

Reggie Willis is the Chief Diversity Officer at Ally Financial. He is responsible for all diversity and inclusion activities at the company, including implementing framework and strategy, partnering with stakeholders, engaging with and supporting employees, and aligning with overall corporate strategy. 

Cooler air ushers in football season, warm drinks and holidays, and for those in the workforce — end of year reviews.

These performance evaluations can be a turning point for both employees and managers, providing an opportunity for growth, development and reflection. But for employees, reviews may create feelings of judgment, comparison and consequences — causing nervousness and fear to rush in.

Fostering psychological safety during this time becomes critical, and managers should consider how they are creating a safe environment where this anxiety-inducing bundle fades and trust and open dialogue can thrive. 

And by psychological safety, I’m talking about an individual’s perception of feeling comfortable expressing their opinions, ideas or concerns during review season — and quite honestly, all year round — without fear of punishment, humiliation or retaliation.  They also trust their managers and leadership to react in a constructive way.

During end-of-year reviews, employees need assurance they can share their perspective and experiences, as well as constructive feedback, and that those will be received with an open mind and a focus on improvement, rather than being used against them. When employees feel safe to share, they are more open about challenges and opportunities, enabling managers to gain valuable insights into their strengths, weaknesses and goals. These meaningful conversations can foster continuous improvement for both the individual and the team. 

When supporting psychological safety and cultivating a culture of trust in the workplace, there are three key principles to consider:

  • Consistency. Establishing trust takes time. It also takes consistency. The year-end review should not be the first or only opportunity to discuss performance. A weekly 1:1 is a great way to catch up on current projects, but I encourage managers to consider quarterly performance feedback touch points focusing on development, and then use the year-end meeting to discuss goals and next steps for the upcoming year. Regularly reviewing progress and discussing obstacles establishes trust and ensures there are no surprises at the end of the year. 
  • Credibility and accountability. In any meetings with employees, they want managers to listen and then offer actionable support. When managers do what they say they will do — that’s integrity — it boosts long-term credibility with your team. Actions should reflect what was with a team; egos or biases that would compromise trust should be abandoned.   
  • Compassion. Managers should create an atmosphere that encourages vulnerability and understanding as we are all human, with emotions and stressors. When we lead with compassion and assume positive intent, we create a culture of authenticity that paves the way for conversations, sometimes difficult, where people feel safe when receiving and giving all feedback. 

By continuously upholding these principles of psychological safety, organizations will set their employees up to become more resilient and create a deeper level of trust in the company and among one another. For the past several years and with these principles in mind, Ally has seen an employee retention rate of over 85%, and in 2023, an employee engagement rate of 84 (out of 100), which is among the top 10% of global companies. 

As we approach the traditional review period, remember that reviews shouldn’t be a day of judgment, but are an opportunity to support growth and development. Managers, put aside your egos and empower your team to speak up, share their thoughts and identify areas of improvement openly. The benefits will ripple beyond the performance review process as employers continue to foster a culture that embraces openness, collaboration and continuous learning.

Let’s commit to prioritizing psychological safety, building trust and unlocking the full potential of our teams.