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Methods of Job Evaluation Joaquin, Kim Sharlyn D. MPA - Fiscal istration Prof. Rosette Librea
Top Four Methods of Job Evaluation
Non-quantitative Methods
Ranking method or Job comparison
Grading method or Job classification
Quantitative Methods
Point rating method
Factor comparison method
Job Evaluation
Systematic way of determining the value or worth of a job in relation to other jobs in an organization
Job evaluations are used to determine the comparative worth of each job, which will then help determine the basis of the wages and salaries offered for each job.
Ranking Method
This method involves putting all jobs in an organization in rank order of importance based upon their contributions towards the achievement of an organization's goals.
All jobs are ranked in the order of their importance from the simplest to the hardest or from the highest to the lowest.
Ranking Method The application of the Ranking Method involves the following procedure: 1.
Utilizing job descriptions
2.
Making paired comparisons
3.
Ranking along a number line a.
Supervision and leadership of subordinates
b.
Cooperation with associates outside the line of authority
c.
Probability and consequence of errors
d.
Minimum experience requirement
e.
Minimum education required
Ranking Method
Merits 1. It is the simplest method. 2. It is quite economical to put it into effect. 3. It is less time consuming and involves little paper work.
Demerits 1. The main demerit of the ranking method is that there are no definite standards of judgment and also there is no way of measuring the differences between jobs. 2. It suffers from its sheer unmanageability when there are a large number of jobs.
Grading Method
Also known as “classification method”
job grades or classes are established by an authorized body or committee appointed for this purpose.
A job grade is defined as a group of different jobs of similar difficulty or requiring similar skills to perform them.
Grading Method Class
Rank
Employees
Class 1
Executives
Office manager, Deputy office manager, Office superintendent, etc.
Class 2
Skilled Workers
Purchasing assistant, Cashier, Receipts clerk, etc.
Class 3
Semi skilled Workers
Stenotypists, Machine operators, etc.
Class 4
Less skilled Workers
File clerks, Office boys, etc.
Grading Method
Merits 1.
This method is easy to understand and simple to operate.
2.
It is economical and, therefore, suitable for small organizations.
3.
The grouping of jobs into classifications makes pay determination problems easy to ister.
4.
This method is useful for Government jobs.
Demerits 1.
The method suffers from personal bias of the committee .
2.
It cannot deal with complex jobs which will not fit neatly into one grade.
3.
This method is rarely used in an industry.
Point Rating Method
Under this method, jobs are broke down based on various identifiable factors such as skill, effort, training, knowledge, hazards, responsibility, etc.
Points are allocated to each of these factors.
The jobs with similar total of points are placed in similar pay grades.
Point Rating Method
The procedure involved in determining job points is as follows: 1.
Determine the jobs to be evaluated.
2.
Decide on the factors to be used in analyzing and evaluating the jobs.
3.
Define the factors clearly in written.
4.
Determine degrees of each factor and assign point value to each degree.
5.
Point values are assigned to different degrees on the basis of arithmetic progression.
6.
Finally, money values are assigned to points.
Point Rating Method
Merits 1.
It is the most comprehensive and accurate method of job evaluation.
2.
Prejudice and human judgment are minimized, i.e. the system cannot be easily manipulated.
3.
Being the systematic method, workers of the organization favor this method.
4.
The scales developed in this method can be used for long time.
5.
Jobs can be easily placed in distinct categories.
Demerits: 1.
It is both time-consuming and expensive method.
2.
It is difficult to understand for an average worker.
3.
A lot of clerical work is involved in recording rating scales.
4.
It is not suitable for managerial jobs wherein the work content is not measurable in quantitative .
Factor Comparison Method
Ranking and point methods
This system is usually used to evaluate white collar, professional and managerial positions.
Factor Comparison Method
Steps in Factor Comparison method: 1.
The key or benchmark jobs are selected as standards.
2.
The factors common to all jobs are identified, selected and defined precisely.
3.
Once the key jobs are identified and also the common factors are chosen, the key jobs are, then, ranked in of the selected common factors.
4.
The next step is to determine a fair and equitable base rate and, then, allocate this base rate among the five common factors as mentioned earlier.
5.
The final step in factor comparison method is to compare and evaluate the remaining jobs in the organization.
Factor Comparison Method Key Job
Daily Wage Rate
Physical Effort
Factors Mental Effort
Skill
Responsib Working ility Condition s
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)
Factor Comparison Method
To illustrate, a ‘painter’ job is to be evaluated. After comparison, it is found that its skill is similar to electrician (15), mental effort to fitter (10) Physical effort to welder (12), working conditions to laborer (4) and responsibility to cleaner (6). Thus, the wage rate for the job of painter will be 47 (15+10+12+4+6).
Factor Comparison Method
Merits: 1.
It is more objective method of job evaluation.
2.
The method is flexible as there is no upper limit on the rating of a factor.
3.
It is fairly easy method to explain to employees.
4.
The use of limited number of factors (usually five) ensures less chances of overlapping and over-weighting of factors.
5.
It facilitates determining the relative worth of different jobs.
Demerits: 1.
It is expensive and time-consuming method.
2.
Using the same five factors for evaluating jobs may not always be appropriate because jobs differ across and within organizations.
3.
It is difficult to understand and operate.
SUMMARY Scheme
Characteristics
Advantages
Disadvantages
Ranking
Whole job comparisons are made to place them in order of importance
Easy to apply and understand
No defined standards of judgementdifferences between jobs are not measured
Grading
Job grades are defined and jobs are slotted into the grades by comparing the whole job description with the grade definition
Simple to operate and standards of judgement are provided in the shape of the grade definitions
Difficult to fit complex jobs into one grade without using excessively elaborate grade definitions
SUMMARY Scheme
Characteristics
Advantages
Disadvantages
Point rating
Separate factors are scored to produce an overall points score for the job
The analytic process of considering separate defined factors provides for objectivity and consistency in making judgements
Complex to install and maintainjudgement is still required to rate jobs in respect of different factors
Factors comparison
Jobs graded by Realistic, practical, reference to market straightforward and rate data and direct quick comparisons with jobs at or near the same level within the organization
Market rate information maybe difficult to obtain or inaccurate
Sources
Singh, S. (2013). Job Evaluation. Retrieved 1 December 2016 from http:// www.slideshare.net/kakhwarisandeep/job-evaluation-16452457
RMS (2013). What are the different methods of job evaluation?. Retrieved 1 December 2016 from http:// www.educationobserver.com/forum/showthread.php?tid=12836
Chand, S. (2016). Top 4 methods of Job Evaluation. Retrieved 29 November 2016 from http://www.yourarticlelibrary.com/hrm/jobs/top-4-methods-of-job-evaluati on-explained-with-diagram/35338/
Grimsley, S. (n.d.) Four Methods of Job Evaluation: Ranking, Classification, Point & Factor Comparison. Retrieved 27 November 2016 from http://study.com/academy/lesson/four-methods-of-job-evaluation-rankingclassification-point-factor-comparison.html#transcriptHeader
Top Four Methods of Job Evaluation
Non-quantitative Methods
Ranking method or Job comparison
Grading method or Job classification
Quantitative Methods
Point rating method
Factor comparison method
Job Evaluation
Systematic way of determining the value or worth of a job in relation to other jobs in an organization
Job evaluations are used to determine the comparative worth of each job, which will then help determine the basis of the wages and salaries offered for each job.
Ranking Method
This method involves putting all jobs in an organization in rank order of importance based upon their contributions towards the achievement of an organization's goals.
All jobs are ranked in the order of their importance from the simplest to the hardest or from the highest to the lowest.
Ranking Method The application of the Ranking Method involves the following procedure: 1.
Utilizing job descriptions
2.
Making paired comparisons
3.
Ranking along a number line a.
Supervision and leadership of subordinates
b.
Cooperation with associates outside the line of authority
c.
Probability and consequence of errors
d.
Minimum experience requirement
e.
Minimum education required
Ranking Method
Merits 1. It is the simplest method. 2. It is quite economical to put it into effect. 3. It is less time consuming and involves little paper work.
Demerits 1. The main demerit of the ranking method is that there are no definite standards of judgment and also there is no way of measuring the differences between jobs. 2. It suffers from its sheer unmanageability when there are a large number of jobs.
Grading Method
Also known as “classification method”
job grades or classes are established by an authorized body or committee appointed for this purpose.
A job grade is defined as a group of different jobs of similar difficulty or requiring similar skills to perform them.
Grading Method Class
Rank
Employees
Class 1
Executives
Office manager, Deputy office manager, Office superintendent, etc.
Class 2
Skilled Workers
Purchasing assistant, Cashier, Receipts clerk, etc.
Class 3
Semi skilled Workers
Stenotypists, Machine operators, etc.
Class 4
Less skilled Workers
File clerks, Office boys, etc.
Grading Method
Merits 1.
This method is easy to understand and simple to operate.
2.
It is economical and, therefore, suitable for small organizations.
3.
The grouping of jobs into classifications makes pay determination problems easy to ister.
4.
This method is useful for Government jobs.
Demerits 1.
The method suffers from personal bias of the committee .
2.
It cannot deal with complex jobs which will not fit neatly into one grade.
3.
This method is rarely used in an industry.
Point Rating Method
Under this method, jobs are broke down based on various identifiable factors such as skill, effort, training, knowledge, hazards, responsibility, etc.
Points are allocated to each of these factors.
The jobs with similar total of points are placed in similar pay grades.
Point Rating Method
The procedure involved in determining job points is as follows: 1.
Determine the jobs to be evaluated.
2.
Decide on the factors to be used in analyzing and evaluating the jobs.
3.
Define the factors clearly in written.
4.
Determine degrees of each factor and assign point value to each degree.
5.
Point values are assigned to different degrees on the basis of arithmetic progression.
6.
Finally, money values are assigned to points.
Point Rating Method
Merits 1.
It is the most comprehensive and accurate method of job evaluation.
2.
Prejudice and human judgment are minimized, i.e. the system cannot be easily manipulated.
3.
Being the systematic method, workers of the organization favor this method.
4.
The scales developed in this method can be used for long time.
5.
Jobs can be easily placed in distinct categories.
Demerits: 1.
It is both time-consuming and expensive method.
2.
It is difficult to understand for an average worker.
3.
A lot of clerical work is involved in recording rating scales.
4.
It is not suitable for managerial jobs wherein the work content is not measurable in quantitative .
Factor Comparison Method
Ranking and point methods
This system is usually used to evaluate white collar, professional and managerial positions.
Factor Comparison Method
Steps in Factor Comparison method: 1.
The key or benchmark jobs are selected as standards.
2.
The factors common to all jobs are identified, selected and defined precisely.
3.
Once the key jobs are identified and also the common factors are chosen, the key jobs are, then, ranked in of the selected common factors.
4.
The next step is to determine a fair and equitable base rate and, then, allocate this base rate among the five common factors as mentioned earlier.
5.
The final step in factor comparison method is to compare and evaluate the remaining jobs in the organization.
Factor Comparison Method Key Job
Daily Wage Rate
Physical Effort
Factors Mental Effort
Skill
Responsib Working ility Condition s
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)
Factor Comparison Method
To illustrate, a ‘painter’ job is to be evaluated. After comparison, it is found that its skill is similar to electrician (15), mental effort to fitter (10) Physical effort to welder (12), working conditions to laborer (4) and responsibility to cleaner (6). Thus, the wage rate for the job of painter will be 47 (15+10+12+4+6).
Factor Comparison Method
Merits: 1.
It is more objective method of job evaluation.
2.
The method is flexible as there is no upper limit on the rating of a factor.
3.
It is fairly easy method to explain to employees.
4.
The use of limited number of factors (usually five) ensures less chances of overlapping and over-weighting of factors.
5.
It facilitates determining the relative worth of different jobs.
Demerits: 1.
It is expensive and time-consuming method.
2.
Using the same five factors for evaluating jobs may not always be appropriate because jobs differ across and within organizations.
3.
It is difficult to understand and operate.
SUMMARY Scheme
Characteristics
Advantages
Disadvantages
Ranking
Whole job comparisons are made to place them in order of importance
Easy to apply and understand
No defined standards of judgementdifferences between jobs are not measured
Grading
Job grades are defined and jobs are slotted into the grades by comparing the whole job description with the grade definition
Simple to operate and standards of judgement are provided in the shape of the grade definitions
Difficult to fit complex jobs into one grade without using excessively elaborate grade definitions
SUMMARY Scheme
Characteristics
Advantages
Disadvantages
Point rating
Separate factors are scored to produce an overall points score for the job
The analytic process of considering separate defined factors provides for objectivity and consistency in making judgements
Complex to install and maintainjudgement is still required to rate jobs in respect of different factors
Factors comparison
Jobs graded by Realistic, practical, reference to market straightforward and rate data and direct quick comparisons with jobs at or near the same level within the organization
Market rate information maybe difficult to obtain or inaccurate
Sources
Singh, S. (2013). Job Evaluation. Retrieved 1 December 2016 from http:// www.slideshare.net/kakhwarisandeep/job-evaluation-16452457
RMS (2013). What are the different methods of job evaluation?. Retrieved 1 December 2016 from http:// www.educationobserver.com/forum/showthread.php?tid=12836
Chand, S. (2016). Top 4 methods of Job Evaluation. Retrieved 29 November 2016 from http://www.yourarticlelibrary.com/hrm/jobs/top-4-methods-of-job-evaluati on-explained-with-diagram/35338/
Grimsley, S. (n.d.) Four Methods of Job Evaluation: Ranking, Classification, Point & Factor Comparison. Retrieved 27 November 2016 from http://study.com/academy/lesson/four-methods-of-job-evaluation-rankingclassification-point-factor-comparison.html#transcriptHeader
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