Job Evaluation

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Job Evaluation
Dr. Anil Mehta
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Definition
Job evaluation is a systematic way of
determining the value/worth of a job in relation
to other jobs in organisation
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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

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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

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

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• 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 unions acceptance and support to the program
  should be obtained

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• 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

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Job Evaluation Methods 1Ranking Method
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
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Advantages

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

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• 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

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• 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

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Factor comparison Method
Responsibility
Factors
Physical Effort
Daily wages Rate
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)
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• 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

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• 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

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

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• 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

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• 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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Thank You