2. 14-2
ANNOTATED OUTLINE
INTRODUCTION
The purpose of job evaluation is to find the relative worth of a job and
determine what a fair wage for such a job should be. Job evaluation, it should
be noted, begins with job analysis (a systematic way of gathering information
about a job) and ends at that point where the worth of a job is ascertained for
achieving pay equity between jobs. Job evaluation is different from
performance appraisal too. Performance appraisal is the systematic
description of an employee's job related strengths and weaknesses.
Job Evaluation
3. 14-3
Features of job evaluation
It tries to assess jobs
The standards of job evaluation are relative, not absolute
It gets the basic information through job analysis
It is generally carried out by groups, not individuals
Some amount of subjectivity is always present in job evaluation
It does not fix pay scales but offers a sound basis for determining a rational
wage structure
Job Evaluation
4. 14-4
The Process Of Job Evaluation
The process of job evaluation involves the following steps
Gaining acceptance from employees and trade unions
Creating a job evaluation committee
Finding the jobs to be evaluated
Analyzing and preparing job descriptions
Selecting the method of job evaluation
Classifying jobs
Installing the programme
Reviewing the process periodically
Job Evaluation
5. 14-5
Essentials For The Success of A
Job Evaluation Programme
Guidelines for conducting the job
evaluation programme
Rate the job and not the person on the job
Collect all the relevant facts accurately
List the distinguishing features of a job and its relationship with other jobs
Study the jobs independently and objectively and then discuss views openly and
thoroughly
Cover all groups and grades of employees
Make it easy to understand
Gain acceptance and support from employees, unions etc.
Job Evaluation
6. 14-6
Job Evaluation Methods
A. Ranking method: The job ranking method arranges jobs in
numerical order on the basis of the importance of the job's duties
and responsibilities to the organization. This method, though easy
to understand, is highly subjective in nature.
B. Classification method: The job classification method slots jobs
into preestablished grades. Higher-rated grades demand more
responsibilities, tougher working conditions and varied job duties.
This method is easy to understand and takes care of all relevant
factors affecting the performance of a job. However, it is not easy
to write all inclusive descriptions of a grade. Further, the method
oversimplifies sharp differences between different jobs and different
grades.
C. Factor comparison method: In this method, jobs are ranked
according to a series of factors such as mental effort, physical
effort, skill needed, responsibility, supervisory responsibility, working
conditions, etc. pay will be assigned in this method by comparing
the weights of the factors required for each job.
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7. 14-7
An example of factor comparison
method
F a c to rs D a ily P h y s ic a l F a c to rs S k ill R e s p o n s ib ility W o rk in g
K ey W age e ffo rt m e n tal c o n d itio n s
Job R a te e ffo rt
E l e c t r ic ia n 60 11 (3 ) 1 4 (1 ) 1 5 (1 ) 1 2 (1 ) 8 (2 )
F itt e r 50 1 4 (1 ) 1 0 (2 ) 9 (2 ) 8 (2) 9 (1 )
W e ld e r 40 1 2 (2 ) 7 (3 ) 8 (3 ) 7 (3 ) 6 (3 )
C le a n e r 30 9 (4 ) 6 (4 ) 4 (5 ) 6 (4 ) 5 (4 )
L a b o u re r 25 8 (5 ) 4 (5 ) 6 (4 ) 3 (5 ) 4 (5 )
Suppose the job of a painter is found to be similar to electrician in skill (15),
fitter in mental effort (10), welder in physical effort (12), cleaner in
responsibility (6) and labourer in working conditions (4) then the wage for
the job would be 47.
Job Evaluation
8. 14-8
Job Evaluation Methods
D. Point method: The point system of job evaluation uses a point
scheme based on the compensable job factors of skill, effort,
responsibility and working conditions. The more compensable
factors a job possesses, the more points are assigned to it. Jobs
with higher accumulated points are considered more valuable to the
organization.
Select key jobs
Identify the factors to all identified jobs such as skill, effort,
responsibility etc.
Divide each major factor into a number of sub factors. Each
sub factor is defined and expressed in order of importance.
Find the maximum number of points assigned to each job
Once the worth of a job in terms of total points is known, the
points are converted into money values, keeping the wage
rates in mind.
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9. 14-9
Point values to factors along a scale
P o in t v a lu e s f o r D e g r e e s T o ta l
F a c to r 1 2 3 4 5
S k i ll 10 20 30 40 50 150
P h y s ic a l e ffo rt 8 16 24 32 40 120
M e n ta l e ffo rt 5 10 15 20 25 75
R e s p o n s ib ilit y 7 14 21 28 35 105
W o r k i n g c o n d it io n s 6 12 18 24 30 90
M a x im u m t o t a l p o in t s o f a ll f a c t o r s d e p e n d in g o n t h e ir im p o r t a n c e t o jo b = 540
( B a n k O ffic e r)
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10. 14-10
Conversion of job grade points into
money value
P o in t r a n g e D a ily W a g e r a t e ( R s ) J o b g r a d e s o f k e y b a n k o ff ic ia ls
5 0 0 -6 0 0 3 0 0 -4 0 0 1 O ffic e r
6 0 0 -7 0 0 4 0 0 -5 0 0 2 A c c o u n ta n t
7 0 0 -8 0 0 5 0 0 -6 0 0 3 M a n a g e r I S c a le
8 0 0 -9 0 0 6 0 0 -7 0 0 4 M a n a g e r II S c a le
9 0 0 -1 0 0 0 7 0 0 -8 0 0 5 M a n a g e r I II S c a le
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A Comparative Picture of Major Job
Evaluation Methods
Major job evaluation methods
M e th o d W h a t fa c e t o f H o w is jo b Typ e of M a jo r M a jo r
jo b is e v a l u a t e d ? e v a lu a t e d ? m e th o d a d v a n ta g e s ( s ) d is a d v a n t a g e ( s )
R a n k in g W h o le jo b J o b s a r e s u b je c t i v e ly N o n - q u a n t it a t iv e R e l a t i v e ly q u ic k E n t ir e ly s u b je c tiv e
( c o m p e n s a b le o r d e r e d a c c o r d in g a n d in e x p e n s iv e
fa c to r s a re t o r e la t i v e w o r t h
im p lic it)
C la s s if ic a t io n W h o l e jo b C o m p a re jo b to N o n - q u a n tita tiv e R e a d i ly a v a il a b l e C u m b e rs o m e
d e s c r ip t io n s o f jo b a n d in e x p e n s iv e s y s te m
g ra d e s
F a c to r C o m p e n s a b le C o m p a r e jo b to k e y Q u a n t i t a t iv e E a s y to u s e H a r d to c o n s tru c t;
c o m p a r is o n fa c to r s o f jo b jo b s o n s c a le s o f in a c c u r a te o v e r tim e
c o m p e n s a b le f a c t o r s
P o in t m e t h o d C o m p e n s a b le C o m p a r e jo b t o Q u a n t i t a t iv e A c c u r a te a n d M a y b e c o s t ly
fa c to r s o f jo b s ta n d a r d is e d s t a b le o v e r t im e
d e s c r ip t io n s o f
d e g r e e s o f u n iv e rs a l
c o m p e n s a b le f a c t o r s
a n d s u b fa c to rs
Job Evaluation
