Yes, it means they examine each case individually, based on the merits of each. "The insurance claims were handled on a case-by-case basis, and this required many man-hours".

To do something on a "case-by-case basis" is to decide something for each individual person or occurrence rather than make one rule or standard to apply to all cases. "Applications for government assistance will be handled on a case-by-case basis." NOTE: the correct punctuation includes the two hyphens (-): case-by-case. It is not correct to write "case by case basis." Last, the logic of your sentence is not clear. It seems to me that if "personal relationships are a top priority," then they ARE deciding to promote employees on a case-by-case basis (and not on some objective standard), based on how close a relationship the boss has with the employee. If my interpretation is correct, I would write your sentence in one of the following ways: 1. They promote employees on a case-by case-basis, because personal relationships are a top priority. 2. They promote employees on a case-by-case basis; personal relationships are a top priority. 3. They promote employees on a case-by-case basis. Personal relationships are a top priority. If you meant to say the opposite, you could write 1. They promote employees on a case-by-case basis. Personal relationships are not a top priority. Here, the boss is using some other standard, such as objective performance measures rather than personal relationships, to decide whether to promote an employee.

The best way to phrase this according to me would be sentence would be as follows: The personal relationships of the employees takes precedence over their merits at the time of promotions. Randy, I would request you to read the question again.