Compensation Management

Job Evaluation

Job evaluation is the process of analyzing and assessing various jobs systematically to ascertain their relative worth in an organization. 

Job evaluation is an assessment of the relative worth of various jobs on the basis of a consistent set of job and personal factors, such as qualifications and skills required.

The objective of job evaluation is to determine which jobs should get more pay than others. Several methods such as job ranking, job grading, and factor comparison are employed in job evaluation. Research indicates, however, that each method is nearly as accurate and reliable as the other in ranking and pricing different jobs. Job evaluation forms the basis for wage and salary negotiations.

JOB EVALUATION METHODS

After job analysis preparations of job descriptions comes the essential stage of job evaluation, namely, the systematic comparison of jobs in order to establish a job hierarchy. The techniques which have been commonly used tend to fall into one of the two main categories: 

Non-analytical or Non-quantitative or summary methods

Analytical or quantitative methods. 

Qualitative methods are: 

1. Job Ranking

2. Job Classification or grading

Quantitative methods are: 

1. Factor Comparison

2. Point rating or assessment

1. Ranking Method

This is the oldest and simplest method of job evaluation. This is generally used in smaller units where the job raters know all the jobs quite well. In this method no effort is made to break a job down into its elements or factors, but the aim is to rather judge the job as a whole and determine the relative value by ranking one whole job against another whole job. In this technique ranking is done according to 'whole job' rather than a number of compensable efforts. 

In it a committee constituted of several executives’ studies job descriptions. Then jobs are arranged from highest to lowest, in order of their value or merit to the organization. Jobs also can...