Accurate and consistent performance ratings are an integral part of equitable performance management systems, yet research suggests that there is a bias that favors White workers and disadvantages Black workers. As the nature and nuances of this bias are unclear, the aim of this study is to explore the sources and forms of racial differences in performance ratings and determine if these differences vary based on performance level. Through an experiment manipulating the race of hypothetical employees undergoing annual performance reviews (N = 306), we found performance rating differences between White and Black employees, depending on performance level and rater race. Specifically, Black raters tended to inflate the performance ratings of both Black and White employees at below-average levels of performance, while White raters allocated larger bonuses to White employees at average or above-average levels of performance. In addition to highlighting that these racial biases still exist, this study contributes to our understanding by exploring both the sources and targets of these biases as well as adding context to the discussion by showing that biases occur primarily when employees deviate from average performance levels.
