W12 - Job Evaluation Theory

Process of evaluating value of jobs performed

Used to calculate appropriate compensation

Makes use of specific types of factors (skills, education, responsibility, decision-making …)

Helps avoiding subjectivity

Ranking employees who do the same job

All jobs with the same factor and compensation is based on the ranking order

Simple and effective

Only suitable for small organizations with small number of employees

Classifies into job groups/classes

Classification by factors like judgement used, skills required or physical effort

Simple method

Judgements are subjective nd could include bias

Scientific method with complex calculations taking into account skills, education and experience…

Ranking each job with set of factors and sub factors

Value of Job is expressed in monetary terms, more unsubjective

While scientific, factoring might include biases

Quantitative method awarding points for various aspects of the job

Select jobs => Identify factors common to all the identified jobs => Divide factor in number of defined subfactors with level of skill going higher in rank => Go along scale to check score

Divide Point ranges in hierachy levels

Reliable, flexible, sytematic

Complex and time consuming