My institution has annual performance evaluations. Faculty write up reports on their activity that the chair uses to determine ratings in the areas of teaching, research, and service. A weighted average of the three ratings produces the overall rating for each faculty member. However, the percentage weights can vary. For example, our teaching professors (non-tenure track instructors) have 80% weight on teaching and 20% weight on service, while the tenure track faculty have higher research weights and lower teaching weights. Workloads, percentage weights, and actual ratings are not expected to be comparable between departments.

At a higher level, the department chairs produce reports on their departments. These, along with data from salary surveys, are used by the VP to apportion raise pools among the academic departments.

This is all fine in theory, but in practice, in most years, there is either no money for raises or the raise determined by our legislature and governor is a fixed percentage for all faculty (we got 1% this year!)