Job evaluation

Unit 2
Ref: HRM – Parvin Durai & Jackson
Revised syllabus
Job
 Role performed by a person in an organization.

 Job comprises of several related tasks required to

be performed as part of it.

 Each job is defined by duties, responsibilities and

accountabilities + knowledge and skills to
perform.

 Each job has a title. Eg. Sales manager,

accountants, nurses, etc.
Job evaluation - definition
 Is a systematic process for defining the
relative worth or size of jobs within an
organization in order to establish internal
relativities and provide the basis for
designing an equitable grade and pay
structure, grading jobs in the structure and
managing relativities. – Michael Armstrong.
Job evaluation – def.
 Job evaluation is done on the basis of the duties,
responsibilities, work pressures and contribution of
each job to organizational goal accomplishments.

 Job evaluation is a systematic technique used for

deciding the relative worth of the job based on its
comparison with other jobs.

 It is non-personal approach as it does not consider

the abilities and skills of the job holders while
evaluating a job.
Steps in Job evaluation process
 Identification of jobs for evaluation

 Gathering the relevant data

 Determination of job ranking

 Selection of benchmark jobs

 Wages and salary survey

 Review and feedback

Identification of jobs to be evaluated
 All jobs in an organization cannot be covered for
evaluation

 Selected jobs are taken

 Factors determining to evaluate the job is chosen

 It may be – mental efforts, physical efforts,

experience, job complexity, concentration,
communication, pressure, leadership skills,
education
Gathering relevant information
about the jobs
 Collect all information relevant to the jobs
evaluated

 Data collection method include – interviews,

questionnaires, observations, job description
statements.

 Analyse the total information received

through these process
Determination of job ranking
 Access the extent of the presence of the
chosen factors in the jobs

 Determine the rating for each job

Selection of benchmark jobs
 Main purpose of job evaluation is the
development of pay grades for each category
of jobs

 Therefore, the pay scales for similar jobs in

other organizations are identified

 These act as benchmark jobs

Wages and salary survey
 Organization conducts survey of pay scales of
the benchmark jobs in other organizations in
the industry

 Salary survey can be formal or informal

 Gather information about salaries through –

telephone, newspapers, websites,
professional agencies, published reports
Periodical review and feedback
 External changes influences the internal work
functioning

 Constant feedback is needed in reviewing

jobs to determine its worth in changed
context

 Information must be obtained about changes

in job demands from its stakeholders such as
union, supervisors, manager etc.
Methods of job evaluation
 Every job in the organization is examined and
rated based on the following:

 Relative importance of the job

 Knowledge, skills, and abilities needed to

perform the job

 Difficulty of the job
Methods of JE
 Ranking method – simplest method

 Places jobs in order ranging from highest to

lowest in values o the organization

 It is a subjective method

 Applies only for small organizations having

limited jobs
Classification method
 Description of each class of jobs are written
and then each job in the organization is put
into a grade according to the class
description it best matches.

 It is subjective

 A job could fall in one classification or more

 It relies heavily on job titles and duties

Point method
 Widely used method

 More sophisticated than ranking or classification

method

 It breaks down the jobs into various

compensable factors and places weighted points
on them

 Compensable factors include skills , knowledge

and effort
Factor comparison
 Is a quantitative and quite complex

 Combination of the ranking and point methods

 First benchmark jobs are identified

 The selecting of compensable factors

 Ranking all benchmark job factors by scores

 A comparison of jobs to market rates for benchmark results in the assignment of

monetary values for each factor is done

 Evaluate all the other jobs in the organization by comparing them with the benchmark
jobs

 It is customized method specific for each organization

 Costly and time consuming.