Civil servants will face more intense scrutiny of their performance before qualifying for annual incremental pay rises under reforms.
The reforms were announced today by the Minister for Public Expenditure and Reform Brendan Howlin.
The existing system was criticised when it emerged that last year only 30 out of around 30,000 civil servants were denied increments for poor performance.
Under the current five point PMDS rating system, staff can qualify for increments with a rating of just two - which effectively means they are underperforming.
There are also inconsistencies on how managers award ratings.
However, in future they will need to achieve at least a three, meaning they have "fully achieved expectations" to get an increment.
There will be a revised ratings scale with improved descriptions of performance and competence levels, as well as an automated performance management system.
Rating will be decided by a system known as performance calibration review - in a bid to ensure ratings are standardised and fully justified.
To secure fairness, people on the same salaries will be assessed against a common set of factors and will be expected to reach similar standards of performance.
The new system will be introduced on a phased basis starting with grades above assistant principal.
Brendan Howlin said they would be targeting senior managers to ensure they drive performance management throughout the civil service.
He also wants to see better engagement between managers and staff about standards of performance.
The Minister described the new system as a more effective tool to manage performance.
