A process of determining the relative worth of the various jobs within the organization so that differential wages may be paid to jobs of different worth. Every job evaluation method requires at least some basic job analysis in order to provide factual information about the jobs concerned. Thus, job evaluation begins with job analysis and ends at that point where the worth of a job is ascertained for achieving pay-equity between jobs. . Job evaluation is the output provided by job analysis.
Objectives of Job Evaluation
- Compare duties, responsibilities and demands of a job with other jobs in the organization.
- To determine which jobs should get more pay than others
- Determine hierarchy and rank of various jobs in an organization.
- Ensure fair and equitable wages based on the relative worth of a job.
- Minimize wage discrimination based on gender,age,caste etc.
Principles of Job Evaluation
- Rate the job and not the employee.
- The elements selected for job evaluation should be properly selected ,defined clearly and easily understood.
Benchmark Jobs:( Key jobs) . A benchmark job is a job that is well-defined across company lines. Benchmark job can be used as yardsticks for pay comparisons either within the organization or to comparable jobs outside the organization.
Compensable Factors: These are those factors for which an organization is willing to pay. Their organization has to decide what is of value to them. Decide what is of value to them. What aspects of a job places it higher in the job hierarchy than another job. These yardsticks are called compensable factors. E.g Education, Experience , Working Conditions, Responsibility etc.
Methods of Job Evaluation
METHODS OF JOB EVALUATION
Job to job comparison used to rank jobs in order from highest to lowest. One job is compared with other jobs based on duties, responsibilities, degree of importance of the job to the organization. The jobs are examined as a whole rather than on the basis of important factors in the job and the job at the top of the list has the highest value and obviously the job at the bottom of the list will have the lowest value. Jobs are usually ranked in each department and then the department rankings are combined to develop an organizational ranking. Usually more than one raters are involved in this process.
It is possible where job numbers are less is and the job rater is well aware of the demands and responsibilities of the job. In large organizations where a large number of job exists, the ranking method would be cumbersome and will also lead to incorrect results. Hence the ranking method is simple to understand and practice and it is best suited for a small organization.
However there is no scientific approach for evaluating the jobs. The judgments are subjective in nature.
Steps in Ranking
- Job Information: Obtain job information by doing job analysis.
- Select and group jobs. The usual procedure is to rank jobs in a department or in clusters as per role field staff, clerical staff, assistants etc.
- Select compensable factors – e.g job difficulty. Generally only one compensable factor is selected which is common to all jobs. You can use more factors.
- Rank the jobs: Each rater is asked to rank the jobs.
- Combine the rating: The ranks given by different raters need to be combined. First all the jobs are divided into appropriate groups by common features (duties, skills, responsibilities etc).
TYPES OF RANKING
Ranking jobs from best to worst on a trait or traits.
This method is used to indicate the job who is highest on the compensable factor being measured and also the job who is lowest, alternating between highest and lowest until all jobs to be rated have been addressed.
Paired Comparison Ranking
A paired comparison job evaluation system compares each job within a company with every other job within the company. A job’s score is determined from the comparisons. The jobs are then ranked by score.
If the job in the left hand column ranks higher than the job across the top, it gets a “1.” If it ranks lower, a zero. Then the numbers are totaled across for total points. Job worth hierarchy is then given by the total points. In this case, Job D would be the highest ranking job with three points, and Job A the lowest ranking with no points.
Jobs are classified and grouped according to a predetermined wage grades. There is a different between classes and grades here. A grade consists of several classes
Grade can be of an Officer. However the can be several classes of Officer: Class I Officer, Class II Officer etc.
STEPS IN JOB CLASSIFICATION
Prepare job grading description for identification of different levels of jobs. Each grade level must be distinct from the grade level adjacent to it. After establishing the grade level, each job is assigned to an appropriate grade level on the basis of the complexity of duties, non-supervisory responsibilities and supervisory responsibilities
- Select grades and key jobs about 10 to 20 jobs, which include all the major departments and functions and cover all the grades
- Grade the key jobs. Key jobs are assigned to an appropriate grade level and their relationship to each other studied.
- Classify all the jobs on the basis of grade definitions. All the jobs in the same grade receive the same wage or range of rate.
STEPS IN POINT RATING
Select Jobs to be evaluated
Select Factors for each job.
Clearly define each factor in detail.
- Working Condition
The above are generic factors. Factors relevant to your jobs need to be selected
Decide if you are bifurcating factors into sub factors.
Determine the number of sub factors
E.g : Sub Factors of Skill :
- Interpersonal Skills
Determine the degree levels for each factor or sub factor
Degree 1: SSC / Degree 2: HSC / Degree 3 : Graduation / Degree 4 : Post Graduation / Degree 5 : Post graduation + Special Certification
Decide the total number of points . It is an arbitrary no.
e.g : 500
Assign weightage to each of the factors and assign relevant point accordingly.
- g : Skill : 50 % / Effort : 15 %
Assign points to each factor.
- Skill : 250
- Effort : 75
Assign Points to the sub factors.
The sum of the highest value in all the sub factors is equal to the value of the factor.
E.g In skill :
- Education (Highest Value) = 75
- Experience ( Highest Value)=100
- Knowledge (Highest Value) =70
Total of above is 250 .( Value for Factor Skill)
Compute the points
As per the sub-factor degree for each the jobs, calculate the value for each factor.
Sum all the factor values to arrive at the points for the job.
Conversion of job points into money value
Once the worth of a job in terms of total points is expressed, the points are converted into money values keeping in view the hourly/daily wage rates.
It is combination of ranking and point rating method. It includes ranking of jobs in respect of compensable factors. Then money wages are assigned to the job depending upon the ranking. Here each job is ranked according to a series of factors.
All jobs are compared to each other to determine their relative importance by selecting compensable factors common to all jobs. The five factors which are commonly used are
- Mental requirement
- Physical requirement
- Working conditions.
Pay will be assigned in this method by comparing the weights of the factor required for each job, i.e., the present wages paid for key jobs may be divided among the factors weighted by importance. So the wages are assigned to the job in comparison to its ranking on each job factor. The basic pay for each ‘key’ job is divided across each factor basis the rank of that factor. This should reflect a range from the lowest to the highest.
- Selection of benchmark jobs
- Selection of factors
- Ranking of Jobs under each factor
- Assign money value to the job
- Comparing all jobs with benchmark jobs