JOB EVALUATION - HUMAN RESOURCE MANAGEMENT



JOB EVALUATION

BY

SMART LEARNING WAY 


CONTENTS 

Job Evaluation: What It Is
Introduction
Definitions
Objectives of job evaluation
Process of job evaluation
Advantages of uses of job evaluation
Limitations of job evaluation
Essentials of successful job evaluation
 Job evaluation methods
 Conclusion
 Bibliography




Job Evaluation: What It Is

·         A transparent system for comparing  jobs
·         Used for establishing relativities between jobs
·         A basis for grading jobs in the new pay structure
·         Based on the demands of jobs
·         Involves analysing jobs under factor headings :
             @ Knowledge and Skills;
             @Responsibilities;
             @Effort & Environment.

Introduction

Job evaluation is an orderly and systematic technique of determining the relative worth of the various jobs within the organization so as to develop an equitable wage and salary structure.

The two most common methods of job evaluation that have been used are first, whole job ranking, where jobs are taken as a whole and ranked against each other. The second method is one of awarding points for various aspects of the job. In the points system various aspects or parts of the job such as education and experience required to perform the job are assessed and a points value awarded.

The higher the educational requirements of the job the higher the points scored. The most well known points scheme was introduced by Hay management consultants in 1951. This scheme evaluates job responsibilities in the light of three major factors - know how, problem solving and accountability

Job evaluation needs to be differentiated from job analysis and performance appraisal. Job analysis is the process of collecting information relating to a job in terms of duties, working conditions, supervisions, etc. it provides the information for evaluating a job. Therefore, job evaluation is something more than job analysis.

Definitions

According to Scott, Clothier and Spriegel, "Job evaluation or job rating is the operation of evaluating a particular job in relation to other jobs either within or outside the organisation."

According to the International Labour Office (I.L.O), “job evaluation is an attempt to determine and compare the demands, which the normal performance of a particular job makes on normal workers, without taking into account the individual abilities or performance of the workers concerned”.

The British Institute of Management has defined job evaluation as “the process of analysis and assessment of jobs to ascertain reliably their relative worth using the assessment as the basis for a balances wage structure”

Eugene J.Benge- A method which helps to establish a justified rank order of jobs. it is only one of the starting points for establishing the relative differentiation of wage rates

Milkowhich and Newman- A systematic procedure designed to aid in establishing pay differentials among jobs within a single employer.

In the words of Dale Yoder, "Job evaluation is a practice which seeks to provide a degree of objectivity in measuring the comparative value of jobs within an organisation and among similar organisations."

According to Kimball and Kimball Jr., "Job evaluation represents an effort to determine the relative value of every job in a plant and to determine what the fair basic wage for such a job should be."

Job evaluation begins with job analysis and ends up with the classification of jobs according to their worth. A job cannot be evaluated unless and until it is analyzed.

Job evaluation also differs from performance appraisal. Performance appraisal is the process of assessing the worth of a jobholder. Whereas job evaluation involves assessment of the worth of a job.

The purpose of job evaluation is to determine basic wage rates for different jobs whereas the aim of performance appraisal is to determine incentives, and rewards for superior performance.

Objectives of job evaluation

The objectives of job evaluation are as follows:
1) to determine equitable wage differentials between different jobs in the organisation ;
2) to eliminate wage inequities;
3) to develop a consistent wage policy;
4) to establish a rational basis for incentive and bonus schemes;
5) to provide a framework for periodic review and revisions of wage rates;
6) to provide a basis for wage negotiations with trade unions.
7)to minimise wage discrimination on the basis of age, sex, caste, region, religion, etc.
8) to enable management to gauge and control the payroll costs.

Process of job evaluation

1)      Gaining Acceptance:

 first of all the cooperation and support of top management, employees and the trade union should be obtained through communication and participation. For this purpose conferences, letters and booklets can be used for explaining the aims and benefits of job evaluation.

2)      Constituting Job Evaluation Committee: 

it is very difficult for a single person to evaluate all jobs objectively. Therefore, a committee consisting of experienced and respected representatives of a management and workers and outside experts should be constituted. Participation of employees in job evaluation will reduce their doubts and suspicion about the programme. 

3)      Selecting Jobs to be Evaluated: 

due to constraints of time and money it may not be possible to evaluate each and every job. Therefore, some key jobs may be selected in each department. The key jobs are evaluated in detail and the other jobs are compared with the keys jobs. The key jobs should be representative of the type of work performed.

4)      Describing the jobs: 

a detailed written description of every job is prepared to indicate the duties and responsibilities involved in it. The job description  is thoroughly checked to ensure that there are no omissions and duplication in it. The acceptance of the employee performing the job is also obtained to the job description.

5)      Selecting the Method of Evaluation: 

there are several methods available for evaluating jobs. The method most appropriate to the job and the organization is choosen. If possible more than one method may be used to increase the accuracy of evaluations.

6)      Weighing job factors:

 a job is compared with other jobs in terms of significant factors which may be as follows:
·         Skill- mental and manual
·         Experience
·         Efforts and initiative
·         Working conditions
·         Responsibilities
·         Supervision required
·         Weights are assigned to each job factor and total weights for a job to indicate its relative value.
·          Different jobs are arranged in a sequence in terms of their relative worth to the company.

7)      Assigning Money Values:

 each job is priced in terms of its worth. In other words, the sequences of jobs in terms of their relative worth is related to a money scale.

8)      Periodic Review:

 a periodic review and revision of job description will help to assuage the feelings of employees who believe that their work was not properly evaluated. moreover, it will enable management to update job description in the light of technological and other changes. For example, automation of a job reduces physical effort, but increases responsibility.

Advantages of uses of job evaluation

1) Job evaluation is a logical and objective technique of ranking jobs and thereby removing wage inequities. It is helpful in developing an equitable, rational and constant wage and salary structure.

2) It helps to improve industrial relations by reducing employee doubts and grievances arising out of wages. It increases employee satisfaction on wage differentials. 

3) It helps in fitting new jobs at their appropriate places in the existing wage structure. 

4) It provides a clear and objective basis for wage negotiations and collective bargaining.

5) It simplifies wage administrations by making wage rate more uniform.

6) It facilitates job redesign by re-allocating the easy and difficult tasks equally among different jobs.

 7) It reveals job which require less or more skilled workers than those already performing these jobs. In this way job evaluation facilitates better utilization of the workforce.
 
8) Due to increasing mechanization and automation, performance depends in many cases more on the machine than on the worker. In such cases, it is unrealistic to pay workers on the basis of their output. Job evaluation is a realistic basis of wage fixation in these cases.

9) Job evaluation invariable involves detailed analysis of a job. Data generated in job evaluation is very useful in selection, placement and training of employees. 

Limitations of job evaluation 

1) Job evaluation is not fully objective and scientific. There is considerable scope for subjective judgment and human error. There is no standard list of factors to be considered and some job factors cannot be measured accurately.

2) Job evaluation fails to consider several factors which influence the value of a given job from worker’s point of view. Demand and supply of a particular skill, security of service, career prospects, social status, nature of supervision, etc. are such factors.

3) Job evaluation makes the wage and salary structure inflexible by freezing wage differentials between jobs. It makes little provisions for adjusting to prevailing wage rates and changing conditions.

4) Job evaluation is not well suited to determining the relative worth of managerial jobs. These jobs involve considerable planning, decision making and supervision of others. These executive skills cannot be measured in quantitative terms.

5) Some methods of job evaluation are difficult to understand. Workers and trade unions often oppose job evaluation. They fear that it will do away with collective bargaining for settlement of wage rates.

6) Job evaluation is a time-consuming and expensive process. As job contents change revaluation of jobs become necessary. Moreover, jobs standardization essential for proper evaluation maybe difficult under changing conditions.

Essentials of successful job evaluation 

The following methods may be adopted to make the job evaluation programme successful:

1) The support of top management must be won for job evaluation programme.

2) Operating managers should convince about the need for and programme of job evaluation. They should be given training in fixing and revising the wages on the basis of job evaluation.

3) All the employees should be provided with complete information about the objectives, programme and techniques of job evaluation.

4) Clear and accurate job descriptions should be prepared and jobs should be standardized before starting the evaluation process.

5) All groups and grades of jobs should be covered in the programme. Similar jobs should be grouped together for this purpose.

6) The techniques used should be simple to understand for employees.

7) The acceptance and support of the trade unions should be obtained.

8) The factors selected for evaluation should be measurable, and should represent the job content. This factors should be clearly defined.

9) The job evaluation programme should not involve unreasonably high costs of installation and administration.

10) In the evaluation process, the knowledge, judgment and experience of human resource department, line managers and outside experts should be posted together.

11) The focus should be on rating the job not the job holder.

12) Job evaluation should be undertaken as an adjunct to collective bargaining.

13) Job evaluation should not adversely affect the terms and conditions of existing employees. 

Job evaluation methods

Job ranking : 
raters examine job description and arrange jobs according to value of the company. 

Job classification:
classes or grades are defined to describe a group of jobs.

Point method:

numerical values are assigned to specific job components; some values provide quantitative assessment of jobs worth.

Conclusion

Job evaluation is the process by which the organization develops a job structure. The job structure is the hierarchy of jobs within the organization, ordered according to their value and importance to the organization. 

Job evaluation involves comparing jobs to each other or to a standard, and then ranking them by the standard of organizational importance.

Over 50% of the jobs in the U.S., as well as an increasing number of other countries, have their wages influenced by job evaluation. However, the popularity of job evaluation has declined in recent years. Changes in organizations away from rigid bureaucratic structures, have found job evaluation not a useful tool.

The first decision to be made in developing a job evaluation plan, is to decide on the factors that account for the importance of the jobs to the organization, called compensable factors.

 Second, a decision must be made as to what jobs will be placed into the job evaluation plan all jobs in the organization or some sub-set of jobs leading to whether there will be one or a number of plans in the organization.

Third, a decision needs to be made as to the type of job evaluation plan that will provide the organization with the best results. Here the organization has a number of choices.
Job evaluation plans are categorized as being either non-quantitative or quantitative. Non-quantitative plans, ranking or classification, 

(1) rate the job as a whole,
(2) clearly rely on the judgments of the evaluator, and 
(3) are generally simpler and more flexible. 

These non-quantitative plans are used mainly in small organizations and governmental units. Quantitative plans, factor comparison and point factor, evaluate the job by the use of factors. These are more difficult to set up, provide a basis for determining their accuracy, and are more popular in industry.

Job evaluation has a basic dilemma. On one hand, it is a technical function that requires training and expertise to perform. On the other hand, the usefulness of job evaluation depends on the acceptance by management and employees of the job structure that results from the process. 

The best way to obtain acceptance is to allow managers and employees a role in the decision making that creates the job structure. Too often, job evaluation is seen by managers and employees as some mysterious, incomprehensible process that has a considerable impact on their wages.



Bibliography

1.)    Human resource management
 by- Jogendra Mehta.
2.)    Essentials of H.R.M. and I.R.
by- P.S. Narayan, P.C.K. Rao
3.)    Human resource and personnal management
by K. Asvathappa
4.)    Human resource management by- C.B. Gupta Sultan Chand and sons
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