Job Evaluation

Job Evaluation is a systematic method of appraising and ascertaining the contributed worth of distinct jobs in an organization. The functions of job evaluation are to create a standard system for evaluating jobs based on an objective set of variables, including skills, responsibilities, complexity, and working conditions. Job-evaluation methods may vary with regard to organizational needs and preferences but generally include the analysis of job descriptions, collection of job-related data, assignment of job grades or classifications, and establishment of salaries structure. Job evaluation is the basis for creating compensation systems, determining pay rates and determining internal equity and consistency in employee compensation throughout the organization.

Example of Job Evaluation

For instance, Global Enterprises, a large corporation, will need to conduct a job evaluation to agree compensation strategies with market standards and internal equity principles. Global Enterprises sets up a cross-functional job evaluation committee that has human resources professionals, subject matter experts, and department representatives to handle the process. The committee starts with analyzing the current job descriptions and gathering data on the tasks, qualifications and performance expectations for all the job positions in the organization. The employment committee can use a job evaluation method such as the point factor system or job ranking to score each job according to predetermined criteria like skill level, decision-making authority and impact of organizational objectives. The results of the job evaluation can be used for decisions about job classification, salary benchmarking, compensation structures and their adjustment to ensure fairness and the competitiveness in the labor market.