At my wife's workplace. They have a 1-5 evaluation scale. She learned that her manager got called out for giving 4s and 5s to people when no one is “supposed” to get higher than a 3 to justify not giving higher raises.
From what I gather, they do it like this to make employees think they're not doing enough so they'll do more than their job description in hopes of getting more money on the next one when in reality it will never be good enough. Meanwhile, all the people towards the top get massive raises. Something like 20k more in 3-5 years, which may not sound like much but considering the employer, it's huge.
My last job had a system like this. I argued on a category and my “negatives” were that I didn't always take a break (due to the workload and schedule, if I didn't stay to do something, I wouldn't have enough time to do it before my relief came in) and that I had a “quirky sense of humor” (that's apparently a negative). I said what's that got to do with my performance and she said “they just told us to write down at least 2 negative things”.
In reality, they had no negative things to say because I have a very good work ethic. I was told that no one ever gets a 5 no matter how good of a worker they are. I said it's to justify not giving bigger raises and was told “I'm not sure why”.
It's all bullshit.