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JOB EVALUATION
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ANNOTATED OUTLINE

INTRODUCTION
The purpose of job evaluation is to find the relative worth of a job and
determine what a fair wage for such a job should be. Job evaluation, it should
be noted, begins with job analysis (a systematic way of gathering information
about a job) and ends at that point where the worth of a job is ascertained
for achieving pay equity between jobs. Job evaluation is different from
performance appraisal too. Performance appraisal is the systematic
description of an employee's job related strengths and weaknesses.

Job Evaluation
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Features of job evaluation

 It tries to assess jobs

 The standards of job evaluation are relative, not absolute
 It gets the basic information through job analysis
 It is generally carried out by groups, not individuals
 Some amount of subjectivity is always present in job evaluation
 It does not fix pay scales but offers a sound basis for determining a rational
wage structure

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The Process Of Job Evaluation

The process of job evaluation involves the following steps

 Gaining acceptance from employees and trade unions
 Creating a job evaluation committee
 Finding the jobs to be evaluated
 Analyzing and preparing job descriptions
 Selecting the method of job evaluation
 Classifying jobs
 Installing the programme
 Reviewing the process periodically

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Essentials For The Success of A

Job Evaluation Programme
Guidelines for conducting the job
evaluation programme
 Rate the job and not the person on the job
 Collect all the relevant facts accurately
 List the distinguishing features of a job and its relationship with other jobs
 Study the jobs independently and objectively and then discuss views openly and
thoroughly
 Cover all groups and grades of employees
 Make it easy to understand
 Gain acceptance and support from employees, unions etc.

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Job Evaluation Methods

A. Ranking method: The job ranking method arranges jobs in

numerical order on the basis of the importance of the job's duties
and responsibilities to the organization. This method, though easy
to understand, is highly subjective in nature.
B. Classification method: The job classification method slots jobs
into preestablished grades. Higher-rated grades demand more
responsibilities, tougher working conditions and varied job duties.
This method is easy to understand and takes care of all relevant
factors affecting the performance of a job. However, it is not easy
to write all inclusive descriptions of a grade. Further, the method
oversimplifies sharp differences between different jobs and
different grades.
C. Factor comparison method: In this method, jobs are ranked
according to a series of factors such as mental effort, physical
effort, skill needed, responsibility, supervisory responsibility,
working conditions, etc. pay will be assigned in this method by
comparing the weights of the factors required for each job.
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An example of factor comparison

method

Factors Daily Physical Factors Skill Responsibility Working

Key Wage effort mental conditions
Job Rate effort

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)

Labourer 25 8(5) 4(5) 6(4) 3(5) 4(5)

Suppose the job of a painter is found to be similar to electrician in skill (15),

fitter in mental effort (10), welder in physical effort (12), cleaner in
responsibility (6) and labourer in working conditions (4) then the wage for
the job would be 47.

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Job Evaluation Methods

D. Point method: The point system of job evaluation uses a point

scheme based on the compensable job factors of skill, effort,
responsibility and working conditions. The more compensable
factors a job possesses, the more points are assigned to it. Jobs
with higher accumulated points are considered more valuable to
the organization.
 Select key jobs
 Identify the factors to all identified jobs such as skill, effort,
responsibility etc.
 Divide each major factor into a number of sub factors. Each
sub factor is defined and expressed in order of importance.
 Find the maximum number of points assigned to each job
 Once the worth of a job in terms of total points is known, the
points are converted into money values, keeping the wage
rates in mind.
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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
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 of all factors depending on their importance to job = 540
(Bank Officer)

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Conversion of job grade points into

money value
Point range Daily Wage rate (Rs) Job grades of key bank officials

500-600 300-400 1 Officer

600-700 400-500 2 Accountant

700-800 500-600 3 Manager I Scale

800-900 600-700 4 Manager II Scale

900-1000 700-800 5 Manager III Scale

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A Comparative Picture of Major Job

Evaluation Methods
Major job evaluation methods
Method What facet of How is job Type of Major Major
job is evaluated? evaluated? method advantages(s) disadvantage(s)

Ranking Whole job Jobs are subjectively Non-quantitative Relatively quick Entirely subjective
(compensable ordered according and in expensive
factors are to relative worth
implicit)

Classification Whole job Compare job to Non-quantitative Readily available Cumbersome

descriptions of job and inexpensive system
grades

Factor Compensable Compare job to key Quantitative Easy to use Hard to construct;
comparison factors of job jobs on scales of inaccurate over time
compensable factors

Point method Compensable Compare job to Quantitative Accurate and May be costly
factors of job standardised stable overtime
descriptions of
degrees of universal
compensable factors
and subfactors

Job Evaluation