Job evaluation is the process of systematically determining the relative worth of jobs to create a job structure for the organization

The evaluation is based on a combination of: Job content Skills required Value to the organization

Organizational culture External market

Content and value A structure based on content orders jobs on the

basis of the skills, duties, and responsibilities associated with the jobs

A structure based on job value orders jobs on the basis of the relative contribution of the skills, duties, and responsibilities of each job to the organization’s goals

Linking content with the external market Aspects of job content take on value based

on their relationship to market wages Aspect not related to the external labor

market may be excluded in the job evaluation

“Measure for measure” versus “Much ado about nothing” Job evaluation may be judged according to

technical standards If participants agree that skills, effort,

responsibilities, and working conditions are important, then work is evaluated based on these factors

To be sure that all relevant aspects of work are included in the evaluation, an organization may start with a sample of benchmark jobs Contents are well-known and relatively stable

over time Job is not unique to one employer A reasonable proportion of the work force is

employed in this job

Orders job descriptions from highest to lowest based on a global definition of relative value or contribution to the organization’s success Alternation ranking orders job descriptions

alternately at each extreme Paired comparison method uses a matrix to

compare all possible pairs of jobs

Disadvantages: Ranking criteria are usually poorly defined Evaluators must be knowledgeable about every job

under study

A series of classes covers the range of jobs A job description is compared to the class

descriptions to decide which class is the best fit

Greater specificity of the class definition improves the reliability of evaluation Limits the variety of jobs that can easily be

classified Jobs within each class are considered to be equal

work and will be paid equally

Common characteristics: Compensable factors Factor degrees numerically scaled Weights reflect relative importance of each

factor

Conduct job analysis Determine compensable factors Scale the factors Weight the factors according to importance Communicate the plan, train users; prepare

manual Apply to nonbenchmark jobs

A representative sample of jobs (benchmark jobs) is drawn for analysis

Content of these jobs is basis for:

Defining compensable factors

Scaling compensable factors

Weighting compensable factors

Compensable factors are those characteristics in the work that the organization values, that help it pursue its strategy and achieve its objectives

Based on strategy and values of organization Reinforce the organization’s culture, values,

business direction, and nature of work May be eliminated if they no longer support the

business strategy

Based on the work itself Documentation must support the choice of factors

Acceptable to the stakeholders

Adapting factors from existing plans Skills and effort required, responsibility, and

working conditions National Electrical Manufacturers Association

(NEMA), National Metal Trades Association (NMTA), Equal Pay Act (1963), and Steel plan

The Hay Guide Chart-Profile Method

How many factors? “Illusion of validity” - Belief that factors capture

divergent aspects of a job and both are important

“Small numbers” - If even one job has a certain characteristic, it is used in the entire work domain

Scales reflecting different degrees within each factor are constructed

Most scales consist of four to eight degrees Also include undefined degrees such as plus

and minus around a scale number Major issue: Interval scaling

Criteria for scaling factors:

Ensure number of degrees is necessary to distinguish among jobs

Use understandable terminology Anchor degree definitions with benchmark-job

titles and/or work behaviors Make it apparent how degree applies to job

Different weights reflect differences in importance attached to each factor by the employer

Determination of factor weights Advisory committee allocates 100 percent of the

value among factors

Select criterion pay structure Committee members recommend the criterion

pay structure Statistical modeling techniques are used to

determine the weight for each factor Statistical approach is termed policy capturing to

differentiate it from the committee a priori judgment approach

Weights also influence pay structure

A manual is developed Describes job evaluation method Defines compensable factors Provides information to distinguish varying

degrees of each factor Users require training and background

information on the plan Appeals process may be included Communication is required to build

employee acceptance

Final step involves applying plan to remaining jobs

Plan becomes a tool for managers and HR specialists

Trained evaluators will evaluate new jobs or reevaluate jobs whose work content has changed

Online job evaluation is widely used in larger organizations

Becomes part of a Total Compensation Service Center for managers and HR generalists to use

Managers and employees with a stake in the results

Committees, task forces, or teams that include representatives from key operating functions, including nonmanagerial employees

Including union representatives helps gain acceptance

Compensation professionals are primarily responsible for most job evaluations for most jobs

Design process matters Attending to the fairness of the design

process and approach chosen is likely to achieve employee and management commitment, trust, and acceptance of results

Compensation professionals are primarily responsible for most job evaluations for most jobs

Appeals/review procedures Inevitable that some jobs are incorrectly

evaluated Requires review procedures for handling such

cases and helping to ensure procedural fairness