Performance appraisals are essential for effective evaluation and management of staff. Since perceptions influence people’s judgement and attitudes towards particular phenomena, it could be expected that the staff of an educational institution might hold diverse opinions about the performance appraisal system in the institution. This study focused on employees’ perceptions of performance appraisal biases or errors, and examined the implications for developing and implementing an effective appraisal system in a polytechnic in Takoradi, Ghana. The study also sought to identify pragmatic ways to ameliorate any appraisal biases that may be present in the institution’s appraisal system. Data was collected from 140 employees of the institution, which included both academic and administrative staff who had worked in the institution for at least two consecutive years, and whose work had been appraised previously. A content validated semi-structured interview schedule was used to interview the respondents. The data collected was analysed, using descriptive statistics, in order to address the research questions. The results of the study indicate that employees of the institution perceive that the performance appraisal system of the institution is affected by subjectivity, and is influenced by some major errors. The findings have serious managerial implications for training, motivation and provision of resources for effective performance appraisal. A major limitation of the study is that, due to financial constraints, it was conducted in only one institution. Therefore, the findings may not be described as a reflection of the general state of affairs in the other educational institutions in the country.