Job evaluation is the name given to any activity which sets out to make systematic comparison between jobs to asses their relative worth, for the purpose of establishing a rational pay structure. In essence job evaluation aims to reduce reliance on arbitrary methods of pay determination by introducing an element of objectivity in the ways jobs are compared. Every job evaluation method requires at least some basic job analysis in order to provide factual information about the jobs concerned. Nevertheless, as with many other aspects of personnel management, judgment has to be exercised in the final analysis.
As Kempner (1980) points out: “Job evaluation methods depend to some extent on a series of subjective judgments made in the light of concepts like logic, justice and equity and the progressive refinement of job evaluation techniques is an attempt to minimize the subjective element.”
Purpose of Job Evaluation
The purpose of job evaluation is to produce a defensible ranking of jobs on which a rational and acceptable pay structure can be built. There are a number of important features of job evaluation which need to be recognized at the outset. These are:
1. Job evaluation attempts to assess jobs, not people.
2. The standards of job evaluation are relative, not absolute.
3. The basic information on which jobs evaluation are made is obtained from job analysis.
4. Job evaluations are carried out by groups, not by individuals.
5. Job evaluation committees utilize concepts such as logic, fairness and consistency in their assessment of jobs.
6. There is always some elements of subjective judgment in job evaluation.
7. Job evaluation does not determine pay scales, but merely provides the evidence on which they may be devised.
Job Evaluation Methods
Job evaluation methods can be divided into two basic categories:
- Non-analytical methods
- Analytical methods
The primary difference between these two categories is that the non-analytical methods take whole jobs and rank them, whereas the analytical methods break jobs down into their component parts and then compare them factor by factor. The implication is that analytical methods provide a more refined means of measurement than non-analytical methods. This point is particularly
relevant for equal pay legislation, since only analytical schemes are considered to provide an acceptable means of identifying “work of equal value”.
1. Non-analytical methods
The two most widely-used non-analytical methods are job ranking and job grading or job classification
1. Job Ranking
The basic process in job ranking is to select a representative sample of jobs (so called benchmarks), prepare basic job description for them, compare them on the basis of the information in the job descriptions and rank them in order of their perceived importance. Each evaluator’s ranking is discussed job evaluation committee, compared with the results obtained by other evaluators, and eventually a final rank order is drawn up. The remaining jobs in the organization are then slotted in to the evaluated rank order on a like-for-like basis. The advantage of this form of evaluation is that it is relatively simple and cheap to operate. Its main disadvantage is that it relies heavily on the subjective assessments of the evaluators, and in particular on their personal knowledge of the benchmark jobs.
In essence, the paired comparisons approach is an attempt to reduce the subjective element to a limited extent by at least forcing judges to make comparisons in a systematic way. Nevertheless, in the final analysis, such a system of evaluation relies considerably on personal judgment.
2. Job Grading
This form of evaluation, also known as job classification, attempts to distinguish between work levels by establishing a small number of general criteria against which specific jobs may be compared. The most well-known, and widely used, system of job grading is the scheme developed by the Institute of Administrative Management. This scheme now has eight grades, each with their statement of general criteria, into which almost 1000 typical office tasks can be slotted. As fig 10.2 shows, grades A and B contain jobs at the elementary level of office work, while Grade F, G and H contain work of high professional level. In a survey of job evaluation
methods conducted by Thakur & Gill (1976)², about one third clerical, administrative and supervisory jobs were evaluated using some form of grading or classification.
Summary of I.A.M. Job Grading Scheme
Grade A – Tasks requiring no previous clerical experience; each individual task is either very simple or closely supervised. Examples include: simple sorting and filling, and messenger work.
Grade B – Simple tasks carried out in accordance with limited number of well-defined rules; fairly short period of training; tasks closely directed and checked. Examples include: simple copying work, and straightforward adding operations and using machine.
Grade C – Tasks of routine nature and following well-defined rules, but requiring some experience or special aptitude. Examples include: simple calculating machine operations preparing routine invoices, and shorthand –typing of routine work.
Grade D – Tasks requiring considerable experience, but only a limited degree of initiative, and which are carried out within existing procedure. Work is not subject to same amount of direction as in lower grades. Examples include; shorthand typing of non-routine work, routine administrative of a group of sales or purchase accounts.
Grade E – Tasks of requiring a basic level of professional knowledge or the performance of clerical/administrative work requiring the occasional use of discretion and initiative, or the supervision of two to six clerical staff. Examples include: routine computer programming, supervision of a section of typists.
Grade F – Tasks requiring intermediate professional or specialized knowledge, or the performance or control of complex clerical or routine administrative work requiring occasional non-routine decisions and some use of judgment on routine matters, or the
supervision of five to twelve clerical staff. Examples include supervision of a print room, conducting routine O&M or systems analysis surveys, complex computer programming, and full secretarial service to chief executive.
Grade G – Tasks requiring professional or specialized knowledge to first degree standard or advanced professional qualification, or the performance or control of work of wide complexity or importance requiring regular non- routine decisions and exercise of discretion,
or supervision of nine to twenty clerical staff. Examples include: supervision of large wages office, computer programming of complex sets of programs, and tutoring on clerical training courses for staff in grades A-F.
Grade H – Tasks requiring professional or specialized knowledge to degree or final qualification level, or performance or control of complex arid important work, requiring extensive use of judgment or initiative and some contribution to policy-making, or
supervision of twenty or more clerical staff together with their supervisors. Examples include: supervision of a customer accounts office with responsibility to credit control within agreed policy, leading complex O & M or systems analysis projects, and control of complex computer programming projects and their staff.
Source: I.A.M. (1976)
As well as being given the broad parameters described above, users of the I.A.M. system have access to some 1000 task definitions against which they can compare practically every office task they are likely to incorporate in their business. Any management using this system will be able to work out appropriate salary scales for each of the grades identified, and thus devise a reasonable structure of pay differentials. The main advantage of job grading is its relative simplicity and cheapness.
Analytical methods of job evaluation examine jobs in terms of their principal components, and not as whole entities. The most widely-used analytical methods are the Points Rating Method and the Hay-MSL Guide Chart System. In both of these methods differences between jobs in an organization can be described, distinguished and measured in relative terms, with a fair degree of credibility, such methods require much more time and effort than non-analytical methods, and are therefore more costly to operate, but many organizations prefer them because they provide a sounder and more defensible basis for wage and salary administration than non-analytical methods.
The basic procedure for introducing an analytical method is as follows:
1. The aims/objectives of the exercise are agreed
2. the organization appoints its own job evaluation team fro amongst its own staff, or hires consultants; employee representatives are elected to the team, as appropriate
3. Relevant job factors are agreed upon
4. Each factor is subdivided by ‘degrees’ or ‘levels’
5. Each factor (and its sub-divisions) is given a weighting
6. points are then allocated to each factor and subdivisions
7. Benchmark jobs are identified
8. detailed job description are written for these jobs
9. Each benchmark job is evaluated in accordance with the points system
10. Benchmark jobs are ranked according to its score
11. The initial ranking of benchmarks is reviewed to identify any anomalies
12. The final benchmark ranking is agreed
13. The remaining jobs are slotted into the benchmark ranking
14. Jobs are grouped within the ranking to isolate possible salary grades, or may be allocated as salary scale on the basis of their individual points total
1. Points Rating Methods
The most frequent factors employed in points systems are as follows:
- Education and training required
- Breadth/depth of experience required
- Social skills required
- Problems-solving skills
- Degree of discretion/use of judgment
- Creative thinking
- Breadth of responsibility
- Specialized responsibility
- Complexity of the work
- Degree of freedom to act
- Number and nature of subordinate staff
- Extent of accountability for equipment/plant
- Extent of accountability for product/materials
- Mental demands of job
- Physical demands of job
- Degree of potential stress
- Timescale of operations
- Turbulent or steady- state
- Amount of necessary traveling
- Diversity of subordinates
- Pressures from other groups
- Difficulty or hazardous surroundings
Most point’s methods incorporate the above factors in one form or another. When devising an “in-house” system, the inclusion of particular factors and decisions about their weightings will be the subject of negotiation between various interested parties. Where trade unions are involved, they will want to be consulted about these matters and to have some influence over the choice of factors in their weightings. Additionally, a significant numbers of women are employed care needs to be taken to ensure that the job factors selected do not implicitly favor ones sex against another, for example by giving higher weightings to length of service and
physical demands (which favor men) in comparison to mental complexity and accountability for others (which may be considered as neutral).
In a leaflet on the amended Equal Pay Act, the Equal Opportunities Commission provides examples of such “neutral” factors. Neutral
factors provide a fairer basis for ensuring “equal pay for work of equal value”. Different management groups also have their preferred weightings. Line managers tend to stress the importance, and therefore weighting, of responsibility, whereas specialists
managers tend to emphasize skills. Ideally, whatever the eventual choice of factors/weightings, one standardized set of criteria should emerge to be applied consistently to all the jobs in the population concerned.
2. Guide Chart Method
A variation of the usual point’s method is widely-used Hay-MSL Guide Chart method. In this method the basic point’s matrix is a standard one, which is applicable across organizational and indeed national boundaries. This is an important future for organizations
that wish to adopt a unified approach that can be applied company-wide, and who are prepared to make full use of Hay consultants in setting up the exercise and seeing through to its to its conclusion. The basic structure of the Hay system is as follows:
1. Three broad factors are employed for the analysis: Know-how, Problem-solving and Accountability, each scored on a Guide-Chart.
2. Each factor is considered by breadth and depth.
3. Know-how refers to the knowledge and skills required to attain “average acceptable performance”.
4. Problem solving refers to the analytical and evaluation aspects of the job, and is seen in two dimensions the extent to which thinking is prescribed and the nature of the thinking challenge (variability creativity, etc).
5. Accountability refers to “the answerability for actions and the consequences of that action”. It has three dimensions: (a) the extent of freedom to act, (b) the job impact on end-results, and (c) the magnitude of the job primarily seen in terms of responsibility for financial results.
The Hay system, as with any other points rating system cannot measure jobs with complete and objective assurance. What it can do is to reduce the subjective and arbitrary elements by a substantial margin, and thus achieve a fairer result with a Non-analytical method. After evaluation, the Hay system ranks benchmarks jobs in accordance with point’s totals. The final rank order is agreed after any Red-circling anomalies have been put right, and salaries are then derived from the application of a tailor-made formula agreed between the individual organization and the Hay consultants.
Job evaluation can play an important role in the development of systematical and equitable pay systems. Analytical systems, in particular, provide a means of identifying key job factors, weighting them as appropriate, and the comparing jobs against them, and eventually arriving at an understanding of relative value of all the jobs in a particular population. On the basis of this evidence of relative worth, pay differential can be worked out in way that is demonstrably fairer than arbitrary decision of individuals or powerful section groups. To the extent that job evaluation bureaucratizes the formulation of pay scales, it reduces the negotiation power of both
trade unions and other influential groups by lobbying them of the possibility of appearing to emotional consideration, which has very little to do with the nature, scope and contribution of jobs in the organizational hierarchy.
Non-analytical methods, popular though they may be, lack the credibility of Analytical methods. No employer, for example, can resist an equal pay demand with any confidence if he is employing Non-analytical methods of job evaluation. The Equal Opportunity legislation will not consider such methods as “proper job evaluations”