Job Evaluation Dr. Anil Mehta

Definition “Job evaluation is a systematic way of determining the value/worth of a job in relation to other jobs in organisation ”

features Tries to assess jobs ,not people The standards of job evaluation are relative not absolute The basic information is obtained from job analysis Carried out by groups, not by individuals Provides a basis for a rational wage-structure

Objectives Establishment of sound wage differentials between jobs Discovery and elimination of inequalities Establishment of sound wage foundation for incentives and bonus Maintenance of consistent wage policy Providing ground for negotiation Effective means for wage control Collection of job facts

Job Evaluation vs Performance Appraisal Point Job-Evaluation Performance Appraisal Define Find the selective worth of a job Find the worth of a job- holder Aim Determine wage rates for different jobs Determine incentives and rewards for superior performance Shows How much a job is worth How well an individual is doing on assigned jobs Compulsion Not Compulsory Compulsory

Basis of Rating Responsibility, qualification, experience, working condition etc. Performance Time Before employee is hired After employee is hired Purpose To establish satisfactory wage differentials To effect promotions, offer rewards, award punishments, assess training needs resort to lay offs , transfers etc.

Objectives of Job evaluation Job Evoluation Process Objectives of Job evaluation Job Analysis Job Specification Job Description Job-evaluation Program Wage-Survey Employee Classification

Steps involved in Job Evaluation Gaining acceptance Creating job evaluation committee Finding the jobs to be evaluated Analyzing and preparing job evaluation Selecting the method of evaluation Classifying the jobs Installing the program Reviewing periodically

Essentials for success of a job evaluation program Compensable factors should represent all the major aspects of job content Operating manager must be convinced about the techniques and programs of job evaluation Al employees should be provided with complete information about the evaluation techniques and program All groups and grades of employees should be covered by the job evaluation program Program and technique of job evaluation should be understood by all employees The union’s acceptance and support to the program should be obtained

Benefits Helps in removing inequalities in existing wage structure Facilitates new jobs in fitting them into existing wage structure Helps in removing grievances, improves in Labour-management relations and workers morale enables wage differences to be purposeful Basis for negotiations Uniformity in wage structure Effective use of Labour

Job Evaluation Methods Array of jobs according to the Ranking Method Rank Monthly Salaries 1 Accountant Rs 6000 2 Accounts Clark Rs 3600 3 Purchase Assistant Rs 3400 4 Machine Operator Rs 2800 5 Typist Rs 1800 6 Office Boy Rs 1200

Advantages Simple and easy to understand Disadvantage Not suitable for big organisation Highly subjective

2 Job Classification Method Advantages Cooperatively less subjective Easy to understand Takes into account all the factors Effectively used for verity of jobs Disadvantages Oversimplifies sharp differences Job descriptions are vague and are not quantified

3 Factor Comparison Method Steps involved Select key jobs Fond out the factors in terms of which the jobs are evaluated Rank the selected jobs Assign money value to each factor The wage rate of every job is appropriated All jobs are compared with the list of key jobs and wage rate is determined

Factor comparison Method Responsibility Factors Daily wages Rate Physical Effort Mental effort Skill Working conditions Key jobs Electrician 60 11 (3) 14 (1) 15 (1) 12 (1) 8 (2) Fitter 50 14 (1) 10 (2) 9 (2) 8 (2) 9 (1) Welder 40 12 (2) 7 (3) 8 (3) 7 (3) 6 (3) Cleaner 30 9 (4) 6 (4) 4 (5) 6 (4) 5 (4) Laborer 25 8 (5) 4 (5) 6 (4) 3 (5) 4 (5)

Advantages Analytical and objective Relative and valid as each job is compared Disadvantage Difficult to understand Same criteria to assess all the jobs is questionable Time consuming and costly

4 Point Method Steps involved Select key jobs Divide each major factor into a number of sub-factor Point out the maximum number of points assigned The points are converted into money value

Point Values to factors along a scale Point values for Degrees Total Factor 1 2 3 4 5 Skill 10 20 30 40 50 150 Physical effort 8 16 24 32 40 120 Mental effort 5 10 15 20 25 75 Responsibility 7 14 21 28 35 105 Working conditions 6 12 18 24 30 90 Maximum total points all factors on their importance to job 540

Job grades of key officials Conversion of Job Grade Points into Money Value Paint range Daily Wage range Job grades of key officials 500-600 600-700 700-800 800-900 900-1000 300-400 400-500 500-600 600-700 700-800 1 Officer 2 Accountant 3 Manager Scale 1 4 Manager Scale 2 5 Manager Scale 3

Advantages Disadvantages Superior and widely used Systematic Reliable Minimum of rating error Disadvantages Complex Time consuming

Limitations of Job Evaluation Rapid changes in demand, supply and technology Substantial differences between job factors and market factors Difficult to change initial stage wage fixation Doubts and fears Financial limitations Not exactly scientific difficulty in selecting compensable factors

Certain Guidelines to Conduct Job Evaluation Rate the job not to a person Strive to collect all the facts accurately Look especially the distinguished features of the job and for relationships to other jobs Study the job objectively and independently Must be conducted systematically The results must be fair, rational and unbiased to the individuals being affected

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