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Job evaluation

Job Evaluation is a method to rank jobs by keeping in mind the duties and responsibilities given

to the job in an organization. Job is evaluated on the basis of contents and it is placed in the

order of their position and significance.

It should be noted that in job evaluation, the jobs are ranked not the job holders. The job

holders are rated through performance appraisal. It is different from the job analysis as job

analysis is a systematic method of gathering information about a job but it needs some job

analysis so that factual information about the jobs concerned is provided. In simpler words job

evaluation is a process of finding out relative value of a job as compared to other jobs.

For nearly 75 years, job evaluation plans are being used in the public and private sectors. There

are different ways in order to design a job evaluation plan. Yet, the same approach is followed,

which is to value each job in a defined group of jobs grounded on a common set of generic

factors.

Job evaluation process

This process starts with describing objectives of evaluation and finishes with establishing wage

and salary differences, which is the main objective of job evaluation. The steps which are

needed to be taken in this process are explained below:

Gaining acceptance

First of all before the process is started, the top management should explain the uses and the

aim of the program to the unions and the employees. Further explanation in the form of oral

representations, letters, or can be used.

Staffing

A committee consisting of heads of different departments acting as representatives of

employees should be made. HR specialists will be the chairmen of this committee. The overall

responsibility for the program should be awarded to a senior executive.

Training for the Committee

In order to make this program successful, members of the job evaluation committee should be

appropriately trained in its procedure.

Selecting the method

Keeping the job factors and the organizational demands in mind, the most suitable method of

evaluating the jobs should be adapted. The ranking method, classification method, factor

comparison method, and point method are among the different methods that can be used.

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Time Factor

Job evaluation should not be carried out in hurriedness so that appeals against the grading of

jobs can be minimized.

Isolating criteria for evaluation

The heart of job evaluation is to determine the criteria for evaluation. Responsibility, skill, effort

and working conditions are used as major criteria in most of the cases. It is clear that job

evaluation criteria vary across jobs.

The main factors determining pay

Demand and supply

Wage rates of workers depends upon demand and supply force in labour market. If the labor is

in short supply, the workers will offer the services only if they are paid well. On the other hand,

if the supply is more than workers available might get ready work at cheaper rates.

Bargaining Power

Where labor unions are strong enough to force the hand of employers, the wages will be

determined at a higher level in comparison to other units where unions are weak.

Cost of living

Wages of workers also depends upon the cost of living of the worker so as to ensure him a

decent living wage. Cost of living varies under deflationary and inflationary pressures.

Where labour unions are strong and employer do not show enough awareness, here wage are

adjusted according to cost of living index numbers.

Condition of product market

Degree of competitions prevailing in the market for the product of the industry will also

influence the wage level. For e.g. if there is perfect competition in the market the wage level

may be at par with the value of net additions made by the workers to the total output, but may

not reach this level in case of imperfect competition in the market.

Comparative Wages

Wages paid by the other firms for the same work also influence the wage levels. Wage

rates must also be in consistent with the wages paid by the other firms in the same industry so

as to increases the job satisfaction among the workers.

Ability to Pay

Wage rates are influenced by the paying ability of industry or firms to its workers. Those firms

which are earning huge profits may afford to pay high wages and can provide more facilities to

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its workers in comparison to the firms earning comparatively low profits.

Productivity of labour

Higher productivity will automatically fetch more profit to the firm, where in turn workers will

be paid high wages in comparison to other firms with low productivity.

Job Requirements

If a job requires higher skill, greater responsibility and risk, the worker placed on that job will

naturally get higher wages in comparison to other jobs which do not require the same degree

of skill, responsibility or risk.

Govt. Policy

Since the bargaining power of the workers is not enough to ensure fair wages in all industries,

the Govt. has to interfere in regulating wage rate to guarantee minimum wage rates in order to

cover the essentials of a decent living.

Goodwill of the company

A few employers want to establish themselves as good employer in the society and fix higher

wages for their workers. It attracts qualified employees.

In addition there are other important factors which affect the individual differences in wage

rates. These are:

1). Workers Capacity and Age

2). Educational qualification.

3). Work experience.

4). Promotion possibilities.5). Stability of employment

6). Demand for product.

7). Profits earned by the organisation.

8). Hazards involved in work etc.

Gender Difference

Although great strides have been made in assuring "equal pay for equal work," on the whole,

women continue to receive lower pay than men. As a group, women also tend to hold lower

paying, lower status jobs, and experience a number of additional inequities in the area of

compensation. There is a basis in law and in court decisions for rectifying pay inequities when

they are due to intentional discrimination on the basis of gender. However, it is often difficult

to determine if wage discrimination is intentional. For instance, women may earn less because

of fewer years of sustained work experience or a lower level of education.

If you believe that you have been discriminated against by an employer, labor union, or

employment agency because of race, color, sex, religion, national origin, age, or disability, a

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