Performance Appraisals (PA) is a tool which is associated with employee performance evaluation. Researchers tend to disagree on the effectiveness of these systems. Academics claim that PAs improve employees' performance through commitment, motivation and output increases, whilst providing an optimal basis for a reward system and training needs. Conversely, it is argued that PAs are flawed from inception since they are subjective, biased and unfair. The study critically assesses research on PAs and their effectiveness towards company goals, whilst identifying a set of criteria to test the extent of their effectiveness. The findings reject the notion that PAs are totally flawed and ineffective. The investigation discloses that HR Practitioners experience difficulties in assessing PAs fairness. The author recommends a number of initiatives to improve appraisees' productivity as a direct result of PAs outcome, thus ensuring their effectiveness. Although the study reaffirms the scholars' claim that PAs effectiveness is a very debatable subject, HR Practitioners still consider PAs as vital to manage employee performance throughout the foreseeable future.