A 5-point rating scale scores performance on five levels, usually running from 1 for the weakest result to 5 for the strongest. A common set of labels is: 1 does not meet expectations, 2 partially meets expectations, 3 meets expectations, 4 exceeds expectations, 5 consistently exceeds expectations. Some companies reverse the numbering so 1 is the best, which is why the labels matter more than the numbers.
Five points is the most widely used scale in performance reviews because it gives enough range to separate strong from adequate work without asking managers to make distinctions they cannot defend. A 3-point scale flattens real differences; a 10-point scale produces ratings that two managers apply inconsistently.
It has two known weaknesses. Managers cluster ratings around the middle to avoid difficult conversations, and they drift upward over time so that 4 quietly becomes the new 3. Both are manageable if you write a short behavioural description of what each level looks like for the role, require a written example for every rating at the extremes, and calibrate ratings across managers before results are shared. Without those, a 5-point scale measures manager temperament as much as employee performance.