Is defined as a systematic method of appraising the worth or value of each job in relation to all other jobs in the same organization?

Meaning, Definitions, Objectives, Steps, Methods Advantages and Limitations

Job evaluation – which is an accepted tool in the hands of the personnel management for avoiding any inconsistency in job rates and for achieving uniformity in the entire wage structure – is done through certain processes. The process – elements are its components.

Job Evaluation is a systematic process of determining the worth of one job in relation to another job in the organisation. During job evaluation, the relative worth of various jobs are assessed so that wages can be paid depending upon the worth of the job.

To improve the performance and maintain the high level of efficiency in work, employee should be compensated with wages and salaries depending upon the job he is performing.

Job evaluation is defined as the systematic process of assessing the value of each job in relation to other jobs in an organisation. It is intended to provide a rational, orderly hierarchy of jobs based on their worth to the company by analysing the difficulty of the work performed and the importance of the work to the organisation. The factors used to assess a job’s worth are identified, defined, and weighted in the company’s job evaluation plan.

Learn about:-

1. Meaning of Job Evaluation 2. Definitions of Job Evaluation 3. Characteristics 4. Objectives 5. Significance 6. Pre-Requisites 7. Steps 8. Methods 9. Implementation 10. Advantages 11. Limitations 12.Measures for the Success of Job Evaluation Programme.

Job Evaluation: Meaning, Definitions, Objectives, Significance, Steps, Methods, Advantages and Limitations


Job Evaluation – Meaning

Job evaluation – which is an accepted tool in the hands of the personnel management for avoiding any inconsistency in job rates and for achieving uniformity in the entire wage structure – is done through certain processes. The process – elements are its components.

At the outset, job analysis to secure job date or information is necessary. For this purpose, job description and job specification are undertaken. In job description – duties, responsibilities and job conditions are described and in job specification – human qualities needed for the job are described.

In the next stage, job rating is done where job description and specification both on the basis of a pre-determined plan are studied. This study reveals a relative score or value to each job.

Then comes the question of money allocation. As per planned system or scale, a money rate of pay to each job is allotted.

While allocating money, employee – classification is undertaken. Employees are classified under right job title based upon work contents actually performed.

Thus, the components of job evaluation are – Job analysis, job description, job specification, job rating, money allocation, and employee classification.

Management’s method to achieve equity in pay is job evaluation. It is the cornerstone of formal wage and salary programme. The central purpose of job evaluation is to determine the relative worth of jobs of an enterprise. It thereby helps in establishing fair pay differentials among jobs.

According to Knowles and Thompson evaluation is useful in eliminating the following discrepancies of a wage payment system:

(a) Paying high wages and salaries to persons who hold jobs and positions not requiring great skill, effort and responsibility;

(b) Paying beginners, less than they are entitled to receive in terms of what is required of them;

(c) Giving a raise to persons whose performance does not justify the raise;

(d) Deciding rates of pay on the basis of seniority rather than ability;

(e) Paying widely varied wages for the same or closely related jobs and positions; and

(f) Paying unequal wages and salaries on the basis of race, sex, religion or political differences.


Job Evaluation – Definitions Defined by Wendell French and Kimball

Job Evaluation is a systematic process of determining the worth of one job in relation to another job in the organisation. During job evaluation, the relative worth of various jobs are assessed so that wages can be paid depending upon the worth of the job. To improve the performance and maintain the high level of efficiency in work, employee should be compensated with wages and salaries depending upon the job he is performing.

In the absence of job evaluation, it may happen that high value jobs may receive less pay than low valued jobs. When the employees come to know about the differences, they may become dissatisfied. Job evaluation is the quantitative measurement of relative worth of job for the purpose of establishing wage differentials. It evaluates the job and not the job holder. Evaluating the job holder is the task of performance appraisal.

Wendell French defines Job evaluation as “a process of determining the relative worth of the various jobs within the organisation so that differential wages may be paid to jobs of different worth”.

Kimball and Kimball define job evaluation “as an effort to determine the relative value of every job in a plant to determine what the fair basic wage for such a job should be.”

Job evaluation is defined as the systematic process of assessing the value of each job in relation to other jobs in an organisation. It is intended to provide a rational, orderly hierarchy of jobs based on their worth to the company by analysing the difficulty of the work performed and the importance of the work to the organisation. The factors used to assess a job’s worth are identified, defined, and weighted in the company’s job evaluation plan.

The focus of job evaluation is typically on the duties and responsibilities assigned to a job, not on the credentials or characteristics of the person who occupies the job, nor the quality or quantity of the incumbent’s performances. This approach assumes that a true sense of job’s elements and demands can be ascertained, measured, and valued only through separating jobs from incumbent employees.

Traditional job evaluation is described as an objective, fact finding, scientific approach that seeks to measure and quantify the relative complexity, the degree of responsibility, and the degree of effort demanded by the duties assigned to a position. The outcome is a hierarchy of jobs, or a “top-down” list, ranked in order of their assigned responsibilities, or their relative worth. While this is how job evaluation is described, some critics argue that the job evaluation process is discriminatory and at least partially responsible for the differences in pay between male and female dominated jobs.


Job Evaluation – 7 Important Characteristics

The main characteristics of job evaluation may be summed up as:

1. It is a method with a systematic approach.

2. It is an analysis of the work involved in its starting point.

3. It is an attempt to determine the requirements of the work involved for any incumbent.

4. It is a process by which jobs in an organisation are appraised.

5. It is a process of analysing and describing positions, grouping them, and determining their relative value by comparing the duties of different positions in terms of their different responsibilities and other requirements.

6. It is a system to deal exclusively with assessment of the job and not concerned with employees assigned to the job.

7. It is designed only to establish wage differentials and is not concerned with the absolute wage level.


Job Evaluation – 7 Main Objectives

As organization constantly evolves and new organizations emerge there will be challenges to existing principles of job evaluation. Whether existing job evaluation techniques and accompanying schemes remain relevant in a faster moving and constantly changing world, where new jobs and roles are invented on a regular basis, remains to be seen.

The formal points systems, used by so many organizations are often already seen to be inflexible. Sticking rigidly to an existing scheme may impose barriers to change. Constantly, updating and writing new jobs together with the time that has to be spent administering the job evaluation schemes may become too cumbersome and time consuming for the benefits that are derived.

The objectives of job evaluation are enumerated below:

1. To secure and maintain complete, accurate and impersonal descriptions of each distinct job or occupation in the entire plant.

2. To provide a standard procedure for determining the relative worth or value of each job in a plant.

3. To determine a rate of pay for each job which is fair and equitable with relation to other jobs in the plant, community and industry.

4. To ensure that like wages are paid to all qualified employees on like work.

5. To promote fair and accurate consideration of all employees for advancement and transfer.

6. To provide a factual basis for the consideration of wage rates for similar jobs both within the community and within the industry.

7. To provide information for the work organisation, employee’s selection and training and numerous other important purposes.

The basis of a sound wage structure is job evaluation. Job evaluation systems are useful in achieving internal equity of pay between different jobs in the organisations. The process of job evaluation uses selected criteria to compare jobs within an organisation so that they can be ordered for the purpose of assigning differential pay.

Job evaluation systems provide a rationale for paying one job in an organisation more or less than another. It is the process of analysis and assessment of jobs to ascertain reliably their relative worth, using the assessment as a basis for a fair and equitable wage structure. It is in the interest of both the unions and the management that job evaluation is carried out on a joint basis.


Job Evaluation – Significance

Job evaluation is a valuable tool that helps in achieving wage rate consistency as well as developing good industrial relations.

The significance of job evaluation can be determined through the following points:

i. Taking account of all the factors that are useful in determining wages and salaries

ii. Maintaining harmony between the union and the management

iii. Standardizing the wage determination process

iv. Compensating the employees as per the requirements of the job to avoid biasness and promote equality in payment of wages

v. Minimizing the cost of recruitment.


Job Evaluation – Pre-Requisites for Effective Job Evaluation

Job evaluation is a vital function of HRM as it helps in deciding the compensation structure in the organization. Before conducting the job evaluation, you should ensure that requisites for job evaluation are in place.

These requisites are as follows:

i. Determining the job system and design

ii. Facilitating participation of recognized unions

iii. Ensuring simplicity in job evaluation system

iv. Ensuring that market surveys are carried out successfully before job evaluation

v. Assuring that the committee has representatives from all the parties, labour, staff, and management

vi. Encouraging active participation from each member

vii. Communicating clearly the objectives of job evaluation process

viii. Facilitating the hiring of outside professionals to bring expertise to the process.

ix. Availability of job analysis information, i.e. job description and job specification.

x. Job evaluation system should be simple and easy to understand.

xi. The job evaluation system should be taken as an adjustment to collective bargaining.

xii. Active involvement of a trade union and employees is essential.

xiii. Availability of industry rates (through labour market survey) to know the prevailing salary rates.

xiv. Selection of groups of employees and jobs to be covered by the evaluation system.

xv. Proper communication of objectives and implication of job evaluation to employees and unions to avoid any misunderstanding.

xvi. Involvement of outsider experts/consultants such as specialists from National Productivity Council, administrative staff college of India, etc. These people have a rich experience in job evaluation.


Job Evaluation –4 Important Steps Involved: Job Analysis, Job Documentation, Rating the Job and Creating the Job Hierarchy

Job evaluation typically, involves four steps:

1. Job analysis;

2. Job documentation;

3. Job rating using the organisation’s job evaluation plan; and

4. Creating the job hierarchy.

Step # 1. Job Analysis:

Job analysis is the process of collecting and evaluating relevant information about jobs. The data collected should clarify the nature of the work being performed (principal tasks, duties, and responsibilities) as well as the level of the work being performed. Information should include the types and extent of knowledge, skill, mental and physical efforts required, as well as the conditions under which the work is typically performed.

Step # 2. Job Documentation:

Job documentation is the process of recording job content information, usually in the form of a written job description, one of the most important products of job analysis. Most job description of the duties, examples of work typically performed, and a statement identifying the knowledge, abilities, skills, and other characteristics (KASOCs) that are required to satisfactorily perform the duties. The ideal job description for compensation reflects not just information concerning “what” a job does, but also the “how” and “why” the duties.

Step # 3. Rating the Job:

In the third step, a job’s assigned duties are assessed using the job evaluation plan, or instrument selected by the organisation.

Discussions about job evaluation approaches focus attention on three basic models:

a. Job ranking,

b. Job classification, and

c. Point factor plans.

Each of these methods is described and explained below:

a. Job Ranking:

The oldest, fastest, and simplest method of job evaluation, job ranking involves ordering jobs from highest to lowest based on some definition of value or contribution. The job that evaluators believe to be the most valuable is placed first, the job that evaluators believe to be the least valuable is placed last and other jobs are ranked in a similar fashion in between, producing a hierarchy.

This method typically looks at whole jobs, rather than their component parts, and gives little attention to the particular collection of tasks that comprise any single job. In addition, the basis for comparison is limited to the other jobs in the organisation. No attempt is outside the organisation.

Two approaches to this method are most common – (i) alternation ranking; and (ii) paired comparison. Alternation ranking involves ordering the positions alternatively each extreme. For example, beginning with a list of 15 jobs, evaluators try to agree on which is the most valuable among the collection of jobs, then which job is the least valuable. In the next round, evaluators will try to agree on which of the remaining 13 jobs is the most valuable, then which is the least valuable. This alternating process continues until all jobs have been ranked and a hierarchy of jobs has been developed.

In the paired comparison approach, each job is evaluated by comparing it with every with other job (one at a time). For each two position comparison, the more valuable job is given a score of and when all the possible comparisons have been made, the hierarchy of jobs is developed by counting the number of times that a job was awarded.

Although it is the simplest method, ranking is seldom the recommended approach. The ranking criteria are usually inadequately defined so that the resultant hierarchy is difficult to explain to employers. In addition, since the approach focuses on the total job, often the highest level duty becomes the basis for the evaluation.

Finally, the ranking approach yields limited information concerning how much more valuable one job is over another, or how the KASOC of one job relate to those of another. This could be a key drawback for an organisation that is committed to employee development and profitability or to creating cross-training opportunities and career ladders.

b. Job Classification:

This method was originally developed, and continues to be used by the government. Within this approach, each job is measured against a pre-existing set of job classes that have been designed to cover the full range of possible positions that would be employed by the government. Broad descriptions or specifications are designed in advance to delineate the characteristics of the jobs that would be placed within that category, within this method, job evaluation involves comparing a position with these generic descriptions and deciding where it fits best; that is, which job level of responsibility assigned to the job under review.

The classification System is relatively inexpensive and easy to administer. But as the number and diversity of position grow, it is increasingly difficult to write level descriptors in advance that will cover the full range of jobs. Without this specificity, the classification method becomes ambiguous and difficult to communicate to workers. In addition, like the ranking method, it is difficult to know how much difference exists between job levels.

Finally, in any whole job rating system, one must be cautious about the same type of rather errors that can creep into performance appraisal. For example, a halo-type error might be one particular component of a position such that he or she assigns the entire job to a grade level that might not be warranted, particularly if the job involves considerable work of a routine nature.

c. Point Factor Method:

Under a point factor plan, various factors are the basis for determining relative worth. Factors are the specific characteristics of jobs that will be measured. In choosing factors, the organisation decides – “what particular job components do we value? What job characteristics will we pay for?” Mental effort, responsibility, complexity of works physical demands, skill required, and working conditions are the most common factors. Factors chosen by a company for use in a job evaluation plan should be for four characteristics.

First, they should represent the job characteristics for which the company is willing to pay. Second, they should be present to varying extent in the jobs to be evaluated. Unless they vary across the population of jobs, there is no point in viewing them as distinguishing features of jobs. Third, they should represent factors that comply with the equal pay act’s skill, effort, responsibility, and working conditions framework. Finally, the factors should be business related; that is, they should support the organisation’s culture and values, its chosen strategy and direction.

Once the factors are identified and described, they should be weighted because all factors are not equally important to an organisation. Typically, factors such as responsibility, decision making, and mental effort are more heavily weighted than physical effort or working conditions. Next, factor scabs must be constructed. Factor scabs are statements of the degree to which the factor is present in any given job.

Factor scabs are sometimes referred to as degree statements. The example of typical degree statement for the factor “Physical requirements” is given as below. Higher degree ratings translate into a greater number of job evaluation points in a point factor.

Example of Degree Statements for the Factor Physical Requirements:

Factor – Physical Requirements:

This factor appraises the physical effort required by a job, including its intensity and degree of continuity. Analysis of this factor may be incorrect unless a sufficiently broad view of the work is considered.

Degree:

1. Light work involving a minimum of physical effort requires only intermittent sitting, standing, and working.

2. Repetitive work of a mechanical nature, small amount of lifting and carrying, occasional difficult working positions, almost continuous sitting or considerable moving around.

3. Continuous standing or walking, or difficult working positions, working with average- weight or heavy materials and supplies, fast manipulative skill in almost continuous use of machine or office equipment on paced work.

A higher degree rating for a job translates into a greater number of job evaluation points.

Some organisations that are attempting to develop a more quantitative approach to setting wage rates and to establish internal equity use a statistical method known as policy capturing to derive the weights for the job factors rated in a point factor system. Policy capturing calls for job experts to rate each job on the job factors and then correlate these ratings with the actual pay for these jobs.

Through this type of regression analysis, the “policy” weights that were used in the past to “Capture” pay rates, or the ability of the factor ratings to predict the wages of the jobs understanding, provides the statistical formula that can be used to price jobs in the future. For example, a statistical weight can be desired for each factor such as skill, education level, working conditions, and responsibility.

Ratings on these factors can be made and the ratings can be plugged into the regression formula to predict the wage level of the job rated. The approach can also be used to test for any problems in the pay system such as discrimination or wage setting that cannot be justified based on actual job context or work performed.

How does the point factor method differ from ranking or classification?

Unlike job ranking, point factor plans do not rank jobs in an organisation purely based on a comparison of one against another, and they do not rely on a rater’s perception of the whole job. Instead, each job is examined concerning the degree to which each factor is present. In this way, the point factor plan is similar to the classification approach in that it uses an external standard, evaluating each job in relation to that standard.

Unlike the classification system, however, the point factor approach breaks jobs down into component parts and assigns point values for various characteristics numerical values for each degree within each factor. A job hierarchy is derived by ranking jobs by their total point score.

Point factor plans have a number of advantages, the written evaluation enables an organisation to trace, analyse, and document differences among jobs. Such differences can be the foundation for training, development, and career progression initiatives that can benefit the organisation in the long run. The fact that jobs are broken down into parts and evaluated using the same criteria over and over again limits the opportunity for rates explaining job evaluation to employees, point factor plans appear to have a high level of integrity.

On the other hand, point factor plans are expensive to design or buy and they are time consuming to install and maintain. Some consultants assert that point factor plans should be administered by an evaluation committee consisting of line operating managers. The time and cost of such commitments must be considered.

In summary, an organisation chooses a job evaluation approach that it believes will best meet its needs and systematically evaluates each job within or against that standard. In addition, many organisations combine elements from each of these approaches to create a hybrid, or combination, approach. Regardless of the method used, job evaluation ratings are typically done by a committee of persons knowledgeable about the jobs under study, with different committees charged with the evaluation of different job families.

Step # 4. Creating the Job Hierarchy:

The result of a job evaluation plan is a hierarchical ordering of jobs in terms of their relative worth to the organisation. Whether it is created by totalling the points assigned to each position, the resulting top-down list should reflect an ordering of position that makes sense to and is meaningful for a particular organisation.

Before finalising this hierarchical list, it is important that the evaluation be studied carefully in relation to another. Consider this something of a “Sore throbbing” process that looks at the final results of the job evaluation and identifies positions that don’t appear to fit best where the job evaluation plan has placed them.

The purpose of a compensation plan is not only to create an internally equitable programme, but also one that is externally competitive. The next step is to consider market place pay practices to that the organisation may effectively complete for workers.


Job Evaluation – Methods: Non-Quantitative and Quantitative Methods (With Examples)

1. Non-quantitative or summary system that utilise non-quantitative methods of listing the jobs-

(a) Ranking System

(b) Grading or Job Classification System

2. Analytical or Quantitative System that use quantitative techniques in listing the jobs-

(a) The Points System

(b) The Factor Comparison System

Method # 1. Ranking System:

Under this system, all the jobs are arranged or ranked in the order of their importance from the lowest to the highest or in the reverse order. The jobs can be rated within the department or a cluster of jobs from different departments can be considered for rating. Job description may be used for ranking different jobs.

Example:

Ranking of teaching job in a college (in the ascending order) like Lecturer, Assistant Professor, Associate Professor, Professor, Senior Professor and Head of the department or ranking of all the jobs which includes both teaching and administrative staff (peons, clerk, head clerk, assistant registrar, registrar and teaching staff) in the college.

The rating is done by a committee of raters and about 10-20 key jobs are rated and other jobs are compared with the key jobs. The ranked jobs are classified into say 8-12 groups. All the jobs under a particular group may receive the same salary or salary range. Example – The Registrar and the Associate Professor may receive the same salary or come under same salary range.

Advantages of Ranking System:

The system is simple, easy to understand and easy to explain to the employees. It require less time, less work and is less expensive.

Disadvantages:

There is no defined criteria for rating the jobs and the rating is based on judgement of the raters. The rating may be influenced by bias/favouritism. The systems only ranks the jobs and does not indicate the exact differences between one job and the other.

Method # 2. Job Classification or Grading:

A number of predetermined grades or classifications are determined by a committee of raters. The jobs are assigned to the grade or class. After detailed job analysis, jobs are grouped into various classes or grades which indicate different pay levels. For each grade/class, there is detailed description so that the employees assigned to particular grade or class. Grade description is based on several factors such as education, independent working, knowledge, skills, attitude, leadership qualities, decision making ability etc.

Example:

If there are five hundred employee holding different jobs, the jobs can be grouped into six to eight classes or grades, i.e., grade 1 to 6/8 arranged from high to low, together with grade descriptions. Jobs at low level (Grade 8) involve routine and repetitive work, works under close supervision.

Grading system is advancement over ranking system and it is also based on judgement of the raters. It is rather difficult to write grade descriptions as the number of jobs increases. This system is used in Government and less in the industry.

Method # 3. The Points System:

The Points System is one of the widely used job evaluation plan. The points system involves identifying a number of job factors and sub-factors and then determining the degree to which these factors are present in the job. Points are assigned for each degree of each factor. The number of points for each factor is added to obtain overall points. The sum of these points gives an index of the relative importance of the jobs that are rated. Money values are assigned to each of the jobs, based on the total value of each job.

Example:

Hay Profile Method developed by Edward N Hay is one of the well-known job evaluation methods. The Hay method makes use of three key factors i.e. Know-how, Problem solving ability and Accountability for evaluation of job position.

Advantages of Points System:

(a) It is more systematic and objective than other systems.

(b) It provides numerical basis for job classification and wage differentials.

(c) Bias/favouritism minimised.

(d) A large number of jobs can be evaluated and the jobs can be placed in distinct categories.

(e) Once the factors, sub factors and points are developed, they can be used for a long time.

(f) Acceptance is better than other systems.

Limitations:

(a) It is time-consuming and expensive process.

(b) Employees find it difficult to understand the working of this method.

Is defined as a systematic method of appraising the worth or value of each job in relation to all other jobs in the same organization?

Note:

Skill – Job factor, Education- Sub-job factor and the points are assigned as shown below-

College education- 40 points, High School- 32, Middle School- 24, Primary School- 16 and Read and Write- 8

Method # 4. The Factor Comparison Method:

Here, the analyst or committee selects some key jobs for which job descriptions and wage rates are agreed upon and are acceptable to the workers and management. Each job is ranked several times, once for each of the job factors selected.

Example- Each job is ranked for skill requirement, and then ranked for responsibility and so on. Then these rating are combined for each job to obtain overall numerical rating for each.

Process of Job Evaluation:

It is a systematic process of evaluating the worth of a job in relation to other jobs in the organisation. HR has to take initiative in developing and implementing an appropriate job evaluation programme in consultation with senior managers in the organisation.

The following factors have to be considered for successful introduction of the system:

a. The management has to explain the objectives and advantages of the job evaluation programme and seek the acceptance of employees and the trade union.

b. A committee comprising of HR manager and senior managers are to be formed and they should receive adequate training well in advance.

c. Selection of the most appropriate job evaluation system.

d. The committee has to decide about the different jobs to be evaluated.

e. Written job analysis document will provide adequate information about each job and each job has to be thoroughly studied.

f. Grading/classifying the jobs based on relative worth of each job.

g. Explain to the employees the outcome of the job evaluation programme and clarify doubts if any.

h. Make changes, if required, based on the feedback.

i. Prepare a document giving the details of the job evaluation process and the worth of each job in the organisation for the purpose of salary fixation, recruitment, selection and promotion.

j. Periodical review to keep it updated.


Job Evaluation – Implementation of Job Evaluation

The evaluated job structure has to be translated into a structure of wage rates.

This depends upon the following things:

(i) The range of wages to be paid, i.e., what should be the maximum and minimum wages for the grade.

(ii) Should there be any overlapping between pay ranges for adjacent pay grades? If so, by how much?

(iii) How many grades should be used?

(iv) On what basis will an individual employee be advanced in wages through the established pay large for the grade?

Above mentioned issues are inter-related, and a change in any of these calls for a change in at least one or the other issue.

As far as the first issue is concerned, it may be noted that the difference between the maximum and the minimum is referred to as the ‘wage range’ or ‘wage differential’. While evaluating a wage structure, it should be seen that the range is not too high and that the job evaluated wage curve does not have too many deviations from the existing industry wage line. This should be done to prevent the turnover of workers and avoid dissatisfaction amongst them.

A wage range can be made with or without an overlap. Theoretically, there should be no overlap because, in that case, an employee near the top of a lower grade gets higher wages than the employee in the higher grade. Too great an overlap may cause dissatisfaction amongst employees and minimise the rewards for superior performance.

However, though a too great overlap should be avoided, there should be some overlapping between the grades so that employees in the lower grades may, get higher wages for excellent performance than an employee working in a higher grade but showing a poor performance.

As regards the number of grades to be adopted in any wage structure, the accuracy may be secured upto six grades; 12 or more grades result in a higher accuracy. Generally, the number of grades considered is between 6 to 11. If more grades are adopted, the overlapping between them would be greater.


Job Evaluation – An I.L.O. Publication Claims Following Advantages for Job Evaluation

An I.L.O. publication claims following advantages for job evaluation:

1. Job evaluation is a logical and, to some extent, an objective method of ranking jobs relative to one another. It may help in removing inequalities in existing wage structures and in maintaining sound and consistent wage differentials in a plant or industry.

2. In the case of new jobs, the method often facilitates fitting them into the existing wage structure.

3. The method helps in removing grievances arising out of relative wages; and it improves Labour- management relations and workers’ morale. In providing a yardstick, by which workers complaints or claims can be judged, the method simplifies discussion of wage demands and enables differences in wages to be explained and justified.

4. The method replaces the many accidental factors, occurring in less systematic procedures, of wage bargaining by more impersonal and objective standards, thus establishing a clear basis for negotiations.

5. Such information also reveals that workers are engaged in jobs requiring less skill and other qualities than they possess, thereby pointing to the possibility of a making more efficient use of the plant’s Labour.

6. The information collected in the process of job description and analysis may also be used for the improvement of selection, transfer and promotion procedures on the basis of comparative job requirements.

7. The method may lead to greater uniformity in wage rates, thus, simplifying wage administration.


Job Evaluation – Limitations

Following are the limitations of job evaluation:

(1) A job evaluation frequently favours groups different from those which are favoured by the market. This is evident from the observations of Kerry and Fishers. They observe, the jobs which tend to rate high as compared with the market are those of janitor, nurse and typist, while craft rates are relatively low. Weaker groups are better served by an evaluation plan than by the market; the former places the emphasis not on force but on enquiry.

(2) Substantial differences exist between factors and the factors emphasised in the market. These differences are wider in cases in which the average pay offered by a company is lower than that prevalent in other companies in the same industry or in the same geographical area.

(3) Though many ways of applying the jobs evaluation technique are available, rapid changes in technology and in the supply and demand of particular skills have given rise to problems of adjustment. These need to be probed.

(4) Higher rates of pay for some jobs at the earlier stages than, other jobs or the evaluation of a higher job higher in the organisational hierarchy at a lower rate than another job relatively lower in the organisational hierarchy often given rise to human relations problems/and lead to grievances among those holding these jobs.

(5) Job factors fluctuate because of changes in production technology, information systems, and division of labour and such other factors. Therefore, the evaluation of a job today is made on the basis of job factors, and does not reflect the time job value in future. In other words, continuing attention and frequent evaluation of a job are essential.

(6) When job evaluation is applied for the first time in any organisation, it creates doubts and often fears in the minds of those, whose jobs are being evaluated. It may also disrupt the existing social and psychological relations his.

(7) Job evaluation takes a long time to install, requires specialised technical personnel, and may be costly.

(8) When job evaluation results in substantial changes in the existing wage structure, the possibility of implementing these changes in a relatively short period may be restricted by the financial limits within which the firm has to operate.

(9) A large number of jobs are called red circle jobs. Some of these may be getting more and others less than the rate determined by job evaluation.


Job Evaluation – Measures for the Success of Job Evaluation Programme

When it is finally decided to install a formal system of job evaluation irrespective of which system is decided upon, the utmost care must be exercised to ensure that human as well as technical aspects are taken into account.

In order that a job evaluation system works efficiently, it is necessary that all those who are concerned with job evaluation should be fully conversant with the techniques and implications of the different available systems – Otherwise, the chances of success are doubtful.

The following measures may be adopted:

(1) Supervisors as a group should receive a thorough training in advance of the actual introduction of the plan to enable them to explain the policies, principles and procedures to anyone who wants to understand them.

(2) Whatever plan or system is selected for each group will arouse some fears or apprehensions. To overcome these, the details of the administration of the plan should be as simple as possible, and the management should endeavour to involve a broad range of employees from a number of departments.

(3) Supervisors should have full knowledge of the system. They should understand it; and be able to explain to their people the purpose of the plan and how it works. They must accept the desirability of the plan, for if they are not convinced that it is useful, they will certainly not be able to convince the employees.

(4) The management must give the widest publicity to every phase of the programme, utilising employee publications, notice boards, departmental meetings and letters to employees homes.

(5) Separate pay structures should be maintained for major groups of employees. For example, it would be difficult to work out a plan equally applicable to factory workers, office workers, salesmen, and departmental heads. The wages that are offered must be at or about the prevailing rate in order that there may be a successful competition for capable people.

According to the findings of the International Relations Sections of the Princeton University, the following conditions are necessary for the successful operation of a job evaluation programme.

(1) It must be carefully established by ensuring that – (a) the management’s aims are clear to all concerned and that not only the manual workers but also all levels of supervision and management employees fully understand its implications; and (b) all the relevant internal and external factors have been taken into account in arriving at the final form the scheme.

(2) The importance of factors, other than job content, in wage rate determination (employment market conditions, sex, wage differentials, geographical wage differentials, and the relative bargaining power of the management and the trade union) must be recognised and taken into consideration while launching a job evaluation programme.

(3) Adequate administrative control must be set up to ensure – (i) a centralised co-ordination of the scheme; (ii) the evaluation of new and changed jobs; (iii) a proper control of individual rate ranges; and (iv) the conduct of wage surveys to provide the necessary information about the intra-plant ranges.

(4) It must have obtained the acceptance of trade unions.

(5) It must have the full approval and continued support and backing of the top management.

(6) Before launching a job evaluation programme; certain issues should be decided beforehand, There are – (i) which category of employees are to be covered (i.e. whether hourly paid job or salaries job employees) and upto what range? (ii) who will evaluate a job outside consultants or trade analysts or the personnel of the personnel department? (iii) how will the employees be consulted in regard to the method of putting the programme through? add (iv) does a proper atmosphere exist for launching of the programme?

We suggest the following measures and steps for improving the working of evaluation programmes:

1. The details of a scheme should be drawn up in such a way that they do not conflict with other provisions of a Collective Agreement such as for example, seniority clauses and grievance procedure.

2. A job evaluation scheme should be chosen cautiously. It should be devised and administered with due regard to the conditions of the employment market, which cannot be ignored if the scheme is to be successful. It should, therefore, reflect the forces. Which are important in the market, e.g., relative supply of and demand for labour, bargaining power of the parties and job conditions.

3. The scheme should be introduced on a plant-to-plant basis than applied to a whole industry. This is because it is difficult to standardise jobs throughout an industry unless the plants in it are so familiar that they can be treated as being virtually a single firm.

4. It is of major importance that the number of job titles and classifications be kept to a minimum. If they are not, a scheme becomes too inflexible because of the narrow coverage of the job descriptions. Promotion is within a grade become more serious. Moreover, workers tend to feel more insecure and cling to their present jobs because they may not have the qualifications for another job.

5. Any anticipated changes in methods should be carried out before a scheme is installed and all modifications in it should be resisted until it becomes fully established.

6. The better the state of industrial relations the easier it is to introduce a job evaluation scheme.

7. In preparing job descriptions it is sound practice to emphasise in them the things which make on job different from another rather than to find a comprehensive statement all the duties of the jobs.

8. The scheme should be sold to all concerned and suggestions sought. If the workers in a plant are unionised, it is highly desirable that any scheme adopted should be agreed to and, if possible, develop jointly by the company and the trade unions.

9. A scheme which provides for single rates and for definite ratios between the rates for classes of workers (A, B,C, etc.) within a job grade is easier to administer than one which establishes rate ranges and has no fixed ratios.

10. A scheme is better administered by the Industrial Relations staff of a company than by the Industrial Engineers, who may have developed it. The essence of successful administration of a scheme is flexibility, and this is better understood by those engaged in industrial relations work than by Industrial Engineers.


Is the systematic way of determining the value and worth of a person in relation to other person in an organization?

A job evaluation is a systematic way of determining the value/worth of a job in relation to other jobs in an organization. It tries to make a systematic comparison between jobs to assess their relative worth for the purpose of establishing a rational pay structure.

Is a systematic approach of determining the relative worth or value of each job in an organization?

Job evaluation is the systematic process of determining the relative value of different jobs in an organization. The goal of job evaluation is to compare jobs with each other in order to create a pay structure that is fair, equitable, and consistent for everyone.

What is job evaluation and its methods?

Job evaluation refers to a systematic method of determining a given job's relative value or worth in relation to other jobs within a specific organization.

What are the 4 methods of job evaluation?

Four primary methods of job evaluations used to set compensation levels are point factor, factor comparison, job ranking and job classification.