What is the relative worth of each job?

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. Job evaluation needs to be differentiated from job analysis. Job analysis is a systematic way of gathering information about a job. 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 and different roles.

Process of Job Evaluation[1][edit]

Job evaluation is a process used to determine the relative worth of different jobs within an organization. The goal of job evaluation is to create a systematic and objective way to assess the value of each job and to ensure that the jobs within the organization are fairly compensated.

The process of job evaluation involves the following steps:

1. Gaining Acceptance: Before undertaking job evaluation, top management must explain the aim and use of the program to the employees and unions. To elaborate the program further, oral presentations could be made. Letters and booklets could be used to classify all relevant aspects of the job evaluation program.
2. Creating Job Evaluation Committee: It is not possible for a single person to evaluate all the key jobs in an organization. Usually, a job evaluation committee consisting of experienced employees, union representatives, and HR experts is created to set the ball rolling.
3. Identify Jobs to be Evaluated: This involves determining which jobs need to be evaluated and developing a list of the jobs to be included in the process.
4. Determine Criteria for Evaluating Jobs: This involves deciding on the factors that will be used to evaluate the jobs, such as the knowledge, skills, and abilities required for each job, the level of responsibility and decision-making required, and the level of physical and mental effort required.
5. Selecting Method of Evaluation: The most important method of evaluating the jobs must be identified now, keeping the job factors as well as organizational demands in mind.
6. Classifying Jobs: The relative worth of various jobs in an organization may be found out after arranging jobs in order of importance using criteria such as skill requirements, experience needed, under which conditions the job is performed, type of responsibilities to be shouldered, degree of supervision needed, the amount of stress caused by the job, etc. Weights can be assigned to each such factor. When we finally add all the weight, the worth of a job is determined. The points may then be converted into monetary values.
7. Collect and Analyze Data: This involves gathering information about the jobs to be evaluated, such as job descriptions, job duties, and the qualifications and experience of the employees who hold the jobs.
8. Assign a Value to Each Job: This involves using the criteria and data collected to assign a value to each job, based on its relative worth to the organization.
9. Installing Program: On the evaluation process is over and a plan of action is ready, management must explain it to employees and put it into operation.
10. Reviewing Periodically: In the light of changes in environmental conditions (technology, products, services, etc.) jobs need to be examined closely. For example, the traditional clerical functions have undergone a rapid change in sectors like banking, insurance, and railways, after computerization. New job descriptions need to be written and the skill needs of new jobs need to be duly incorporated into the evaluation process. Otherwise, employees may feel that all relevant job factors based on which their pay has been determined have not been evaluated properly.

Methods of Job Evaluation[2][edit]

These are the some of primary methods of job evaluation explained below:

1. Ranking Method
2. Classification Method
3. Point Method
4. Factor Comparison Method
5. Pay Survey Method
6. Job Evaluation Committee
7. Analytical Job Evaluation

Ranking Method[edit]

Perhaps the simplest method of job evaluation is the ranking method. According to this method, jobs are arranged from highest to lowest, in order of their value or merit to the organization. Jobs can also be arranged according to the relative difficulty in performing them.

The jobs are examined as a whole rather than on the basis of important factors in the job. 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.

The variation in payment of salaries depends on the variation of the nature of the job performed by the employees. The ranking method is simple to understand and practice and it is best suited for a small organization. Its simplicity however works to its disadvantage in big organizations because rankings are difficult to develop in a large, complex organization. Moreover, this kind of ranking is highly subjective in nature and may offend many employees.

This method works by assigning each job a grade, level, or class that corresponds to a pay grade for instance Grade I, Grade II, Grade III, and so forth. These grades or classifications are created by identifying gradations of some common denominations, such as job responsibility, skill, knowledge, education required, and so on:

1. Class I: Executives: Further classification under this category may be Office Manager, Deputy Office Manager, Office superintendent, Departmental supervisor, etc.
2. Class II: Skilled Workers: Under this category may come the Purchasing assistant, Cashier, Receipts clerks, etc.
3. Class III: Semiskilled Workers: Under this category may come to Stenotypists, Machine- operators, Switchboard operators,s, etc.
4. Class IV: Semiskilled Workers: This category comprises Daftaris, File clerks, office boys, etc.

Then, for each job grade so created standard job descriptions are determined. Thereafter, such standard description is matched with job descriptions in the organization. The standard description that most nearly matches the job description determines the job‘s grading.

This method requires a decision at the initial stage on the number of pay grades to be included in the wage and salary plan. Of course, the actual amount to be assigned to pay grades is made after the job evaluation is completed.

Factor Comparison Method[edit]

In this method, instead of ranking complete jobs, each job is ranked according to a series of factors. These factors include mental effort, physical effort, the skill needed, responsibility, supervisory responsibility, working conditions, and other such factors (for instance, know-how, problem-solving abilities, accountability, etc.).

Pay will be assigned in this method by comparing the weights of the factors required for each job, i.e. the present wages paid for key jobs may be divided among the factors weighted by importance (the most important factor, for instance, mental effort, receiving the highest weight). In other words, wages are assigned to the job in comparison to its ranking on each job factor.

Point Method[edit]

This method involves breaking down a job into its various components or factors, such as skills, education, experience, and responsibilities. Each factor is assigned a value, and the total value of the job is determined by adding up the values of all the factors.

1. Select key jobs. Identify the factors common to all the identified jobs such as skill, effort, responsibility, etc.
2. Divide each major factor into a number of sub-factors. Each sub-factor is defined and expressed clearly in the order of importance, preferably along a scale. The most frequent factors employed in point systems are:
   1. Skill (key factor): Education and training required, Breadth/depth of experience required, Social skills required, problem-solving skills, Degree of discretion/use of judgment, and Creative thinking.
   2. Responsibility/Accountability: Breadth of responsibility, Specialialised responsibility, Complexity of the work, Degree of freedom to act, Number of nature of the subordinate staff, Extent of accountability for equipment/plant, Extent of accountability for product/materials.
   3. Effort: Mental demands of a job, physical demands of a job, Degree of potential stress.
   4. Find the maximum number of points assigned to each job (after adding up the point values of all sub-factors of such a job). This would help in finding the relative worth of a job.
3. 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. A wage survey is usually undertaken to collect wage rates of certain key jobs in the organization.

Pay Survey Method[edit]

This method involves comparing the pay of similar jobs in other organizations to determine the value of a job in the organization.

Job Evaluation Committee[edit]

This method involves a committee of people, typically managers and HR professionals, who evaluate jobs based on a set of predetermined criteria.

Analytical Job Evaluation[edit]

This method involves using statistical techniques to evaluate jobs based on a variety of factors, such as skill level, responsibilities, and working conditions. The choice of method for job evaluation will depend on the specific needs and goals of the organization, as well as the resources and expertise available.

Advantages of Job Evaluation[edit]

The following are the important advantages of job evaluation:

1. Establishing Fair Pay: Job evaluations can help ensure that employees are paid fairly for their work, based on the duties and responsibilities of their positions.
2. Facilitating Promotions and Transfers: Job evaluations can provide a basis for determining which employees are eligible for promotions or transfers to other positions within the organization.
3. Improving Communication: Conducting a job evaluation can help improve communication between management and employees, as it allows employees to understand the expectations and responsibilities of their positions.
4. Identifying Training Needs: Job evaluations can help identify any training or development needs that employees may have in order to perform their jobs effectively.
5. Improving Morale: Fair pay and clear job expectations can improve employee morale and reduce turnover.
6. Facilitating Succession Planning: Job evaluations can help organizations plan for the future by identifying key positions and the employees who are best suited to fill them.
7. Ensuring Compliance: Job evaluations can help organizations ensure that they are in compliance with various laws and regulations, such as those related to equal pay and non-discrimination.

Disadvantages of Job Evaluation[edit]

There are some disadvantages to using job evaluation as a method in an organization. These are some disadvantages of job evaluation:

1. Complexity: Job evaluation can be a complex and time-consuming process, requiring extensive analysis and data gathering. This can be a burden on HR departments and managers who are responsible for conducting the evaluations.

1. Subjectivity: The process of evaluating jobs can be subjective, as it involves making judgments about the relative value of different positions. This can lead to inconsistency in the evaluation process and potential biases.

1. Resistance: Employees may resist the idea of job evaluation, particularly if they feel that their job is being undervalued or if they are concerned about the potential impact on their pay. This can lead to negative employee morale and lower productivity.

1. Cost: Implementing a job evaluation system can be expensive, as it requires resources to develop and maintain the system, as well as to train managers and employees on how to use it.

1. Limited Flexibility: Once a job evaluation system is in place, it can be difficult to make changes to the relative values of different positions. This can limit an organization's ability to respond to changes in the market or the needs of the business.

Concept of job evaluation[edit]

What is job design? As we just explained, job analysis provides job-related data as well as the skills and knowledge required for the incumbent to perform the job. A better job performance also requires deciding on sequence of job contents. This is called 'job design'. Job design is a logical sequence to job analysis. In other words, job design involves specifying the contents of a job, the work methods used in its performance and how the job relates to other jobs in the organisation.

A few definitions on job design are produced here with a view to help you understand the meaning of job design in a better manner. Michael Armstrong11 has defined job design as "the process of deciding on the contents of a job in terms of its duties and responsibilities, on the methods to be used in carrying out the job, in terms of techniques, systems and procedures, and on the relationships that should exist between the job holder and his superiors, subordinates and colleagues".

Mathis and Jackson I2 have defined job design as "a process that integrates work content (tasks, functions, relationships), the rewards(extrinsic and intrinsic), and the qualifications required (skills, knowledge, abilities) for each job in a way that meets the needs of employees and organisations."

Popplewell and Wildsmith13 define job design in these words: "......involves conscious efforts to organise tasks, duties, and responsibilities into a unit of work to achieve certain objectives".

Having gone through the above definitions of job design, it can now be described as a deliberate attempt made to structure both technical and social aspects of the job to attain a fit between the individual (job holder) and the job. The very idea is that job should be designed in such a way as to enable employees to control over the aspects of their work. The underlying justification being that by doing this, it enhances the quality of the work life, harnesses the potential of the workers in a more effective manner and thereby improves employee performance.

Techniques for designing jobs[edit]

Basically, there are four techniques used in the design of jobs. These include Job simplification, Job enlargement, Job enrichment and Job rotation.

Job simplification is a design method whereby jobs are divided into smaller components and subsequently assigned to workers as whole jobs. Simplification of work requires that jobs be broken down into their smallest units and then analysed. Each resulting sub-unit typically consists of relatively few operations. These subunits are then assigned to the workers as their total job. Many fast food restaurants such as McDonald's, Burger King and KFC use simplification because employees can learn tasks rapidly; short work cycles allow task performance with little or no mental effort and low-skilled and low-paid employees can be hired and trained easily.

On the negative side, job simplification results in workers experiencing boredom, frustration, alienation, lack of motivation and low job satisfaction. This, in turn, leads to lower productivity and increased cost.

Job enlargement[edit]

Job enlargement expands a job horizontally. It increases job scope; that is, it increases the number of different operations required in a job and the frequency with which the job cycle is repeated. By increasing the number of tasks an individual performs, job enlargement increases the job scope, or job diversity. Instead of only sorting the incoming mail by department, for instance, a mail sorter's job could be enlarged to include physically delivering the mail to the various departments or running outgoing letters through the postage meter.

Efforts at job enlargement have met with less than enthusiastic results. As one employee who experienced such a redesign on his job remarked, "Before I had one lousy job. Now, through enlargement, I have three!" So while job enlargement attacks the lack of diversity in overspecialised jobs, it has done little to provide challenge or meaningfulness to a worker's activities.

Job rotation[edit]

Job rotation refers to the movement of an employee from one job to another. Jobs themselves are not actually changed, only the employees are rotated among various jobs. An employee who works on a routine job moves to work on another job for some hours/days/months and returns to the first job. This measure relieves the employee from the boredom and monotony, improves the employee's skills regarding various jobs and prepares worker's self-image and provides personal growth. However, frequent job rotations are not advisable in view of their negative impact on the organisation and the employee..

Job enrichment[edit]

Job enrichment, as currently practiced in industry, is a direct outgrowth of Herzberg's Two Factor Theory of motivation. It is, therefore, based on the assumption that in order to motivate personnel, the job itself must provide opportunities for achievement recognition, responsibility, advancement and growth. The basic idea is to restore to jobs the elements of interest that were taken away under intensive specialisation. Job enrichment tries to embellish the job with factors that Herzberg characterised as motivators: achievement, recognition, increased responsibilities, opportunities for growth, advancement and increased competence. There is an attempt to build into jobs a higher sense of challenge and achievement, through vertical job loading. 6 Job enrichment has four unique aspects:

What is the process that determines the relative value of one job in relation to another?

What are the 5 types of job evaluation methods?

How should the firm determine the relative value of different jobs so as to justify differences in compensation levels?

What is a job classification?