Job Evaluation

Technique for comparing JOBS rather than employees. “system for comparing different jobs systematically to assess their relative worth, so providing a basis for a grading and reward structure”.

Job Evaluation Good remuneration systems must be seen as fair – especially by employees! The law also demands that jobs of equal worth should attract equal pay. A key factor in fairness will be linking the degree of difficulty of the job with the reward. Job evaluation can be used to assess the relative difficulty of the job.

Job Evaluation Types of job evaluation: Non-analytical (eg rating, grading, paired comparison) Analytical (eg points rating, HAY-MSL)

Job Evaluation Using job evaluation for setting pay: Analyse jobs and rank them Group jobs into grades/bands Link pay to bands Only the first stage is ‘job evaluation’

Job Evaluation Job evaluation is, by definition, subjective. Subjectivity reduces effectiveness. However, analytical systems try to reduce subjectivity. Effectiveness of job evaluation can also be affected by external forces (eg market shortages) and ‘tinkering’ (eg using perks)

Job Evaluation Advantages Provides a systematic and rational procedure for valuing each job Ensures a degree of equity and objectiveness in remuneration Job descriptions generated are useful for other activities Helps motivation and morale Both employee and employer needs are addressed Scope for union/employee involvement

Job Evaluation Disadvantages Bonuses can upset relationships External factors may do the same Lack of allowance for differences in performance Assessment can be costly & time-consuming especially at the start Assessment can be inaccurate or approximate It’s still subjective!