What error occurs when evaluations do not accurately reflect an employee's performance?

The error of central tendency occurs when evaluators tend to rate all employees as average, regardless of their actual performance levels. This leads to a lack of differentiation between high and low performers, making it challenging to identify who may need improvement and who is excelling. This tendency can stem from an evaluator's discomfort with making difficult distinctions or a desire to avoid conflict. As a result, employee evaluations do not accurately reflect individual performance, which can hinder effective personnel management and development within the organization.

The other types of errors are more specific in their nature. Bias refers to a personal prejudice affecting the evaluation process, the error of contrast involves comparing an employee's performance to that of others rather than to an established standard, and the halo effect occurs when one positive aspect of a person influences the overall evaluation unfairly. However, these do not specifically encapsulate the inaccurate midpoint rating characteristic of central tendency errors.