UNIT 7 JOB EVALUATION AND Job Evaluation and

Internal Equity

INTERNAL EQUITY

Objectives

After going through this unit, you should be able to:

• understand the concept of Internal Equity,

• explain the concept of Job Evaluation (JE),
• describe and understand the procedure of JE, and
• ennumerate different methods of JE.

Structure

7.1 Concept of Internal and External Equity

7.2 Job Evaluation
7.3 Methods and Systems of JE
7.4 Job Analysis and Job Description
7.5 Linking Wage- Fixation
7.6 Implementing Job Evaluation
7.6 Summary
7.8 Self-Assessment Questions
7.9 Further Readings

7.1 CONCEPT OF INTERNAL AND EXTERNAL

EQUITY
The basic binding factor for an employee with the organisation is the
compensation & recognition he gets for the contribution/services he renders
to accomplish the desired output or goals of the enterprise. We, all know that
salary (including allowances) or wages is the prime compensation to an
employee in primarily associating and motivating him to work. Being a social
animal, he also compares his take home-pay with others working along at the
work-place and expects an equitable compensation in relation to similar tasks
performed within his organisation. And also, the approach is also to compare
the compensation levels of similar jobs/tasks in the industry or the region or
locality.

This is how the concept of Internal Equity and External Equity have come
about. The basic tenets of Taylor's Scientific Management with respect to
human resource management centre around.

• Right Man For The Right Job

• Right Pay For The Right Job

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Legal Frameworks of Thereby, the man on the job is kept highly motivated to associate himself
Compensation and
Rewards with the work through suitable (right) training & placement as well as
attractive (equitable) compensation, so that skill and attitude (motivation) of
the employee is most optimum for discharging his duties. This is where the
issue of determining the relative worth of a job within his organisation to
establish internal equity assumes relevance. The method of determining the
internal worth of the jobs is .known as Job Evaluation, which establishes the
rational differentials that are required between jobs, ultimately leading to a
wage-structure across the jobs in the organisation.

Accordingly, Pay/wage surveys in the industry/region attempt to compare the

internal wage structure of an organisation with those prevailing in the market.
Such an External Equity enables the management-to evolve a suitable wage
structure to attract required skills/talent and retain them with the organisation.

In conclusion, it may be observed that Job-Evaluation is a means to establish

the internal worth of a job relative to others, where as pay/wage-surveys are
the means to evolve suitable wage structure to attract/motivate & retain
employees by establishing External Equity. These two techniques of
scientific management would enable the management to locate the Right man
and retain him suitably motivated through Pay or wages.

7.2 JOB EVALUATION

Definition

Job evaluation is over 100 years old. According to a source first attempts at
the job evaluation were made in 1861 by US Civil Services Commission.
(Patton, little Field & Self, 1964). With the advent of Scientific management
and Industrial engineering it is used widely till today, for purposes of
determining differentials in remuneration, particularly for manual jobs and
related activities. Defined by British standard Institution (1969) Job
Evaluation is "A generic term covering methods of determining the relative
worth (Equity) of jobs." Job Evaluation is a systematic (Quantitative and
qualitative) method, for determining the relative worth of a job in
comparision with in and outside organisation . It helps to eliminate wage
inequities and to establish a basis for sound salary and wage-structure. Job
Evaluation consists the following:

• Job analysis: the process of examining the content of a job, breaking it

down into it's task, functions, processes, operation & elements.
• Job Description: description of a job based on job analysis.
• Job Specification: the statement of the content of job based on job
description and job grading.
• Job Grading: ranking of job as a result of job analysis
• Job Classification: grouping jobs according to their worth
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• Job Assessment: the ascription of a monetary value on the basis of job. Job Evaluation and
Internal Equity
grading.

The methods used for Job Evaluation of workers & managers are marginally
different at the grading & Assessment stages, while the above generic process
is usually followed. Job Evaluation is concerned with the evaluation of the
job in terms of its requirement of skill, responsibilities, effort and other
factors in performing the job. It does not evaluate the man performing the job
and it is not related with the quality or quantity of the output or the speed of
working. These are subject matters of merit rating and work-study.

Rationale

There are number of reasons for it's extended usage. Organisations are
becoming more scientific and systematic through the introduction of various
management strategies and techniques i.e. growth, amalgamation, take-overs,
stiff competition, and in many cases shortage of skilled manpower. All
combine to cause a critical appraisal of the workforce and subsequent
rationalisation with the ongoing social, technological and economic change,
the content of jobs are inexorably altering. New and newer jobs are created
every day. Even the shape of traditional jobs have also changed in due
course. Jobs have become de-skilled and more of systematic and new
specialists have proliferated with the march of "change". The problem is
further exacerbated where traditional notions of skilled, semiskilled &
unskilled work still forms the basis of remuneration. The technology of today
has changed the degree of skill required and redistribute the same to wider
exhaust. And the addition of white collor workforce to traditional workforce
has changed the traditional worker to sophisticated manager of own job work.

Today the jobs are not what they are named and the work is not what it is
paid for. So this is the plinth of pay determination problem - assessing and
agreeing the fairness of pay differentials. Wage or Pay in equities do creep in
due to a number of reasons in our organizations namely

i Favoritism by the supervisor/manager

ii Pressures from employee groups/unions
iii Scarcity of Skills
iv Unsystematic approach to pay-structure.

Job Evaluation as a systematic approach brings in better rationalisation in

Pay/wage structure.

Objectives

The purposes that are served by JE are multi-fold considering the issues
facing the organisation at a point of time. However the primary & secondary
objectives JE serves are as below:

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Legal Frameworks of Primary Objectives:
Compensation and
Rewards
 To. establish wage level of a plant
 To establish relative wage level in a plant.
 To bring new jobs to their proper relative parity with existing jobs
 To facilitate wage negotiations Secondary Objectives
 To determine qualities (Job-Specification) for new Jobs for employee
selection
 To determine criterion for merit rating & promotions
 To analyse wage rates.
 To find scope of automation & improvement
 To train new supervisors
 To improve working condition as better compensation in lieu. of that.

Activity 1
Talk to managers of the departments of a four companies is your vicinity
and prepare a bring write up as the significance of job evalution for an
organization.
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Job Evaluation Procedure

The general step-wise procedure for job evaluation is as under

1. Select the group of jobs

Such as workmen category, office staff, supervisory or managerial as
distinct groups.
2. Study the Job (Job analysis)
i. The jobs are studied by (a) qetting information from the employee
about his work, (b) Observing the work, and (c) Consulting the
supervisors of the employees.
ii. The information gathered from different sources regarding a
88 particular job is recorded on the Job Analysis Sheet. Full details
 regarding the content of work, equipment used, working conditions, Job Evaluation and
Internal Equity
qualifications needed to do the work, time taken to learn the job,
supervision received and given, and responsibilities involved are
noted down on the Job Analysis Record.
3. Prepare Job Descriptions - approval.
On the basis of detailed information, recorded in thed Job Analysis
Sheet, Job descriptions are prepared. These job descriptions state simply
and clearly a comprehensive picture of the job.
4 Device an evaluation plan - common characteristics/traits
A set of key factors such as education, experience, responsibilities and
working conditions are selected and weightages given to all these factors.
Each factor is generally divided into degrees which indicates the extent
to which the factor is required for successful performance of the job.
This constitutes the job evaluation plan. It is known as the point plan as it
involves giving points to each of the jobs to indicate their relative values.
5. Establish a committee of raters and Rate/Evaluate
A committee of raters jointly rate the jobs by applying the point plan to
the job description. In case of any difference of opinion among the raters,
efforts are made to arrive at a conclusion by referring to facts stated in
the job description, the job analysis, and in some cases by going back to
the work spot.
6 Establish a Committee of raters and Rate/Evaluate
A committee of raters jointly rate the jobs by applying the point plan to
the job description. In case of any difference of opinion among the raters,
efforts are made to arrive at a conclusion by referring to ,facts stated in
the job description, the job analysis, and in some cases by going back to
the work spot.
7 Group or Classify the jobs
The point values given to the job on various factors are totalled up and
the total points secured by different jobs are classified into grades. The
number of grades into which they can be classified depends upon the
policies of the organisation, the view of management and union, and the
experience and judgement of the raters.
8 Convert job grades to money value (Wage Survey)
The point values of the jobs are converted into money values on the basis
of wage survey results and finances available for establishing a more
equitable wage differential in the organisation.
9. Obtain approval from Union & Management
10. Establish a suitable grievance Procedure
A report on the job evaluation containing full details regarding the work
done and a set of recommendations is prepared for use, at the time of
implementation and in dealing with any appeals from the employees. 89
Legal Frameworks of
Compensation and 7.3 METHODS AND SYSTEMS OF JOB
Rewards
EVALUATION
The methods and systems of Job Evaluation. are divided in different
categories which are as follows:

A. Conventional: A variety of job evaluation systems are in use and all of

them are modifications of four basic systems. These are the ranking
system, the grading ,system, the factor comparison system, and the point
system. All of them are similar to each other in certain respects and are
applicable to all types of jobs at all levels.
I) Non quantitative
a) Ranking method
b) Classification method
II) Quantitative
a. Points Rating method
b. Factor Comparision method
B) Innovative/Non-Conventional: These systems are quite innovative and
use concepts of management- decision making and related aspects as
factors for establishing internal equity. These are:
i) Time span of Discretion method ii Decision Band Method
iii) Direct Consensus method iv Guide Chart Profile method v Urwick
Orr Profile method

Ranking Method

In this method simple & easy job-descriptions are made and sorted in the
sequential order of their worth as whole. The jobs common in various
organisations are checked and jobs are ranked/rated by interpolation. All the
jobs in an organisation are ranked in the order of complexity, responsibility
and demands they make on the respective employees. Ranking of all the jobs
is made easier by first identifying those that come at two extreme ends of the
scale and locating the rest in the middle-region. A committee carries out this
ranking more than once and the results of repeated ranking are pooled to
arrive at the final ranking. Wherever there is significant discrepancy in
rankings by members of the Evaluation Committee, the matter is settled by
mutual discussion. The final ranking of jobs is based on the average ranking
of all members and the times ranked.

Advantages
• It is simplest of all procedures
• It is less time consuming
• It leaves more room for unions to bargain Disadvantages
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• Sometimes equal differentials are assessed to adjacent ranks Job Evaluation and
Internal Equity
• None of the committee member is likely to be familiar with all jobs

Classification Method

This method is sometimes called as predetermined grading method. A limited

number of job grades are established on the basis of a knowledge about the
existing jobs in the organisation. Each of these grades is defined in terms of
general functions and qualifications required. This is followed by
development of job descriptions which briefly state the nature of duties of
each job. These global job descriptions are matched with the grades, and jobs
are classified into one or the other grades.

Advantages

• It is comparatively easier method

• It is less time consuming
Disadvantages
• It is irrational in absence of logic, and nearby jobs are sometimes put in
different classes
• It is very hard to determine the pre-requisites of classes.

Point Rating Method

In this method the whole job is analysed through 5-8 factors and over 20-50
sub- factors based on requirements. These factors/sub-factors are given points
which totals out as the overall position of the jobs. Though it is not scientific
it is systematic method. It is the most popular method in use today in judging
the relative of worth of jobs factors. This steps involved in this system so far
described are:

a) Job analysis through interview/questionnaire and actual observation.

b) Writing up of job descriptions from the data collected through job
analysis and checking them up with departments supervisors concerned
for accuracy.
The next important step is the selection of an appropriate plan for the jobs to
be evaluated. A plan should contain such job characteristics or factors
divided into a number of degrees which would provide suitable scales for
measuring the extent of a particular characteristic present in the job being
evaluated. Further, a plan should be developed or adopted in such a way as to
cover the types of jobs which are to be evaluated., thus, a plan for clerical
employees is not suitable for factory operatives. In such a plan, the inclusion
of the factor of physical effort may not be necessary because of the sedantary
nature of the job, but physical effort is an important factor in almost all
factory jobs. After factors have been decided upon they should be defined to
make their meanings clear and unambiguous. Due weightage should be given
to them. Here again one has to be careful in judging the relative weightage of
factors.
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Legal Frameworks of Thus in a sophisticated process plant the factor of mental/visual effort will
Compensation and
Rewards have a higher weightage than the factor of physical effort, because the job of
the operator is mainly to keep watch on instruments and meters at the control
panel rather than to go for heavy physical exertion. Factors are then divided
into a suitable number of degrees between their extremes and each degree is
defined to make its meaning clear. Thus, the factor of education may, in a
plan to evaluate factory operatives, have three degrees between the lowest
(which may be defined as ability to follow instructions) and the highest (a
certificate of proficiency in trade from an institution). Point values are then
assigned to each degree. Summing up, it may be stated that this step would
involve:

C. Development of an appropriate plan which involves-

i Selection and definition of factors and giving due weightage to them
ii Deciding on the number of degrees and defining them, and
iii Assigning point values to degrees

An example of the factors, degrees and points used in a job evaluation plan
for the daily-rated workers of a paper mill is given below:

Table 1:

Factors and Degrees Defined for Education

This factor appraises the educational requirement considered necessary to

perform the job satisfactorily. A formal education or schooling may not be
essential, but such requirement is expressed in terms of equivalent years of
schooling. The knowledge might have been acquired by self-study or
practical knowledge

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I DEGREE Job Evaluation and
Internal Equity
Ability to follow verbal instructions in local language for performing
manual tasks of either repetitive or closely supervised non-repetitive
nature and also to count numbers.
II DEGREE
Ability to read and write words in English and to perform simple
arithmetical calculations. Some trade knowledge in paper making,
finishing, etc., equivalent to primary school education.
III DEGREE
Ability to read and write simple. English, perform arithmetical
calculations involving use of fraction, decimals, etc.; use shop, tools and
understand simple drawings, good trade knowledge in 'beating, chalk
mixing, etc., equivalent to class VIII standard in High School.
IV DEGREE
Ability to read and write; perform mathematical calculations; understand
detailed sketches and proficiency in a trade like fitting, welding, etc.,
equivalent to Matriculation standard.
V DEGREE
Background education suitable for understanding all aspects of a trade
which may be considered equivalent to a certificate course from
Industrial Training Institute or a first-class certificate of compentency
from a Government Department.
Similar, factor and degree definitions are prepared for all other factors in
the plan.
The next step in the process is the actual evaluation of jobs. Appropriate
degree for each factor is determined for each job, and point values are
assigned to each degree. The total of these point values represents the
worth of an individual job. All types of jobs covered by the plan (daily
rated in the example) are thus evaluated and finally grouped into classes
according to the ranges of values between jobs having minimum and
maximum values and their clustering. Two jobs are evaluated below
(Table 2).
Table 2: Job Evaluation
Sweeper Point Turner
Degree Degree Point
Education 1 14 4 56
Experience 1 21 3 60
Initiative & Ingenuity 1 8 4 32
Physical effort 2 20 2 20
Mental demand 2 16 4 32
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Legal Frameworks of Responsibility for Mat./Prod./Process 8 3 24
Compensation and
Rewards Respon. For Tools & Equiipment 1 4 4 16
Respon. For Work of others 1 4 2 8
Respon. For Safety of others 1 4 2 8
Surroundings 3 36 3 36
Hazards 2 16 3 24
Total Points 150 316

According to the classification indicated below, the above jobs fall in classes
A and D respectively.

Table 3: Point and Class Range

Class Point range

A = 140-190
B = 191-240
C = 241-290
D = 291-340
E = 341-390
F = 191 & over

The point valtths finally arrived at are then covered to monetary values for
determining the wage rates of the jobs. A minimum wage rate can be decided
upon (may be after negotiation with union) for jobs .having the lowest point
values and a maximum rate for those with highest point values. Wage rates
for all jobs can be fixed between this rate range. Similarly, suitable wage
grades or scales can be worked out for other classified jobs after evaluation.
The resulting wage structure will reflect the true differential in the worth of
jobs.

It may be stated that though at times criticisms are leveled against job
evaluation, as the process involves certain amount of subjective judgement,
nevertheless, this is perhaps the best technique evolved so far to reduce
wages inequities.
Advantages
• It is the most sophisticated system.
• All the outcome is in hard fact numbers
Disadvantages
• It is time consuming
• Satisfying Benchmark jobs for the degrees are required to be put forth
for rating effectively.
Factor Comparision Method
Here important factors or elements of jobs are evaluated in terms of monetary
value and relative jobs are positioned in terms of those factors & values. The
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factors usually considered in this system are five in number. Mental Job Evaluation and
Internal Equity
requirement, skill, physical requirements, Responsibility and working
conditions.

The system involves detailed job analysis, ranking jobs in respect of pre-
determined factors, apportioning the total money paid to the different factors
of the job, fitting key jobs into the system, and locating all other jobs in
relation, to the key jobs. The main features of the system consist of evaluating
important elements of the job in terms of money value and establishing the
relative positions of jobs in terms of specific factors.

Advantages:

• Internal comparision & External comparision of job within and out of the
industry are considered.
• Monetary units are used for comparision
• Disadvantages:
• Conflict may arise on the valuation of each factor
• It is difficult of apportion the total wage in various factors

Comparative Merits of Factor Comparison and Point Systems

• Both the systems are fundamentally analytical and quantitative in their

approach. Unlike the ranking and grading systems, these are based on
detailed analysis of jobs and assessment of the different factors of the
job.
• Factor comparison system ranks jobs in relation in each other, while the
point system relates each job to a descriptive scale and arrives at a
numberical value.

There is no clearly stated and defined scale used in factor comparison,

whereas the point system defines the factors, their degrees and the point
values, in specific terms.

• These stages are more clear in the case of the point system than in factor
comparison.
• Money units are used as an integral part of the factor comparison system.
It is difficult for the employees to understand the justification. The point
system makes no reference to money units.
• The ranking of jobs is easier on the point system. The basis for ranking is
the number of points obtained by each job. Such ranking is difficult in
the factor comparison.
• While using the point system, it is fairly common to use a variety of
factors depending upon the requirements of the organisation.
• Both the systems recognise the need for giving weightages to factors.
But the point system uses point values for giving weightages to different
factors. Use of numerical values provides for greater flexibility and 95
Legal Frameworks of clarity.
Compensation and
Rewards • The factor comparison system can be applied to a wider range of jobs
including the Executive positions, while the point system is applicable to
a smaller range. The point system is usually restricted to evaluation of
jobs at the operative level. In practice however, even the factor
comparison system is restricted to this level. The essential nature of
Executive jobs is such that the factors in either system cannot help in
assessment.

Other Methods

These methods are sophisticated and are based on subtle aspects of

management like decision making etc., but are required to evaluate some
Managerial and/or special/ conceptional types of jobs. Well known
management consultancy organisations have evolved through innovation
such systems, when confronted with Executive Compensation packages

a. Time Span of Discretion Methods

This system uses the concept that all make decisions in their work and the
effect of such a decision on the work/organisation is felt after a certain period
for taking up a follow-up action. Here "the longest possible time for which
discretion (decision' to fructify) could be exercised without direct managerial
review" is considered, as the key factor in determining the levels. For e.g. A
decision taken by a board member may get reflected after a few years, as
against a supervisors in a week and a worker in a few hours similarly.

Unskilled worker - few hours Marketing Manager- 2-3 years Board of

direction- 10 years

b. Decision Band Method

Here, type of decision to be made by the job is considered and placed in the
applicable band. The Bands are:

Band E- Policy Making decisions i.e. Top Management

Band D- Programming decisions i.e. by Senior Managers
Band C- Interpretive decisions i.e. by middle managers
Band B- Routine decisions i.e. by skilled operators on line
Band A- Automatic decisions regarding when, how & where i.e. by semi-
Skilled operators
Band O- Defined decisions by unskilled workmen.
c. Direct Concensus Method
Here the workman & evaluator reach to the value by mutual concensus.
d. Guide Chart Profile method
This method is also called Hay MSL method. Its operational distinction is
96 that it attempts to combine job evaluation with external comparision of
market rates as a unified package. It concerns only managerial jobs. One of Job Evaluation and
Internal Equity
the main feature is the measurement of accountability & know-how to the
organisation by the job.

e. Urwick-Orr Profile Method

Here the point & ranking methods are applied with an addition of concensus
method. It is not a new method but an advancement in evaluation with the
addition of employees! union to a very high degree.

Activity 1
Evaluate the jobs of Constable in Army, Police & Para-Military and Traffic
Police by any two methods
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7.4 JOB ANALYSIS JOB DESCRIPTION

Job Analysis

American Management. Association. says "Where it is difficult to describe

the common characteristics of a group of positions that are to be allocated to
the same class in the process of classification, it is often possible to adoopt
the expedient of explaining the kind of ability, kind of experience, kind of
skills etc. that a person qualified to handle the work must posses. The first
step in the process of classification is, therefore, learn all that is practical to
learn regarding the duties of each position in the service. National Personnel
Association defines job analysis as "the process which results in establishing
the component of a job and ascertaining the human qualifications necessary
for it's successful performance."
Job analysis, which is the first step in the job evaluation process, consists of
analysing the jobs in detail. The idea of such analysis is to find out all
relevant facts in respect of the job. Job analysis is carried out by gathering
information in respect of the job either through interviews or questionnaires.
Where the workers are illiterate or unable to express themselves in written
languages, pertinent job information is collected through interviews. On the
other hand, the information is collected through questionnaires, wherein the
workers fill up particulars about their jobs.
The nature of information gathered through job analysis the requirements of
skill in performing the job, responsibilities involved, and the surroundings in
which it is performed. The job is studied and watched when actually
performed, to give a clear picture of the tasks involved and the skills, abilities
97
Legal Frameworks of and knowledge required.
Compensation and
Rewards Verification with supervisor is necessary for the accuracy of the job facts.
The data obtained through job analysis are recorded on what is known as a
job analysis sheet.
The analysis format may vary depending upon the nature of jobs analysed for
e.g. factors related to physical skill aspects can be covered for workman as
against managerial facets of decision making and responsibility for planning
etc. for supervisory level.
Job Description
A designation by itself does not give a clear idea as to what is involved in a
job and the situation in which it is carried out. Sometimes different jobs have
the same designation, and on other occasions very similar jobs are carried out
under different titles. It is essential that the jobs are described accurately in
order that any one using the job description can get a clear and" definite-
picture of the work involved. The validity and accuracy of any job evaluation
is mainly dependent upon a reliable job description which truly reflects what
is being done by the employees.

Job descriptions are used for a variety of purposes such as selection of

employees, training, prevention of accidents, and job evaluation. Job
description is further description of jobs based on job analysis sheets and
essentially contains:
• Identification data
• Summary of Job
• Work Performed
• Responsibilities of Tools, Equipment, Materials, Reports and Records,
Work of others & Results.
• Work Environment/Health Hazards
• Required qualities

The on the job data is collected by a combination of approaches which

essentially include: i) Observation- based on Work Study & Time Study
Principles ii) Interviewing the Employee iii) Questionnaire Method and iv.)
Consulting Supervisors. For illustration a typical job-descriptions of a cashier
is given in Table 4.

Activity 2
Having gone through the job description of a cashier, now write down the job
descriptions of the following:
i Plumber ………………………………………………………………….
ii Bus Conductor …………………………………………………………..
iii Mason …………………………………………………………………….
iv Electicion …………………………………………………………………
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 Table 4: Sample job description Job Evaluation and
Internal Equity

7.5 LINKING WITH WAGE FIXATION

After all the jobs have been evaluated, checked, and reviewed, the next step
is to link the wages to points and derive a final wage structure. The major
steps involved in this are: (I) Deriving the company wage curve, (ii) Job
Classification, and (iii) Pricing of jobs. The wage curve is a graphic
relationship between the job points and the corresponding wages paid to the
job. The points evaluated for each job is plotted on the x-axis, and the
corresponding wages on the y-axis. When all the jobs have been plotted a
scatter diagram would be obtained.

A line of best fit is obtained for the plotted points either by drawing a
freehand line or by statistical computations. Least squares trend and the
second degree curve are the statistical computations normally made.

The ultimate object of job evaluation is to determine equitable wage rates for
each job. For this the points would have to be connected into monitory
values.

Establishing pay-rates for each job, though possible, is extremely difficult to

operate, and makes administration of the wage structure cumbersome. Hence
the normal practice is to classify the jobs into a definite number of categories
and establish a wage rate for each category which will be applicable to all the
jobs falling in that category.
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Legal Frameworks of The jobs are arranged as per their evaluated points in an ascending or a
Compensation and
Rewards descending manner. This will facilitate in determining the point range for
each classification.

The number of categories with regard to factory jobs vary from 5 to 11 with 6
to 9 categories being the common number adopted in most of the industries.
When the final classification is established, it may be represented as follow:

Point Range Category

465 and above VI
400-464 V
325-399 IV
250-324 III
165-249 II
100-164 I

When all the jobs in the company have been classified into a definite number
of categories, each category needs to be fixed with proper wage-scales. For
this it is necessary to ascertain whether the existing wage structure of the
company is sound, reasonable, and comparable with the practices obtaining
in other industries. This is done through a wage or pay survey.

7.6 IMPLEMENTING JOB EVALUATION

It has been found that the idea of carryinging out Job Evaluation work mostly
comes from either the top management or the members of senior
management. Often it is the Personnel Manager who takes the initiative in
putting the idea across to the consideration of management. After the idea is
accepted by the top management and the employee representatives, there are
three alternatives open for getting the job done. The entire work is carried out
by (1) the company employees, or (2) consultants or (3) jointly carried out by
company employees and consultants.
Whatever be the scheme adopted for use it presupposes the establishment of a
Job Evaluation Committee. This committee usually consists of management
representatives drawn from various departments. Some companies invite
union representatives to serve on the committee. Acceptance of the invitation
and continued participation in committee work by the union representatives is
a communication of their acceptance of the scheme and also helps in keeping
them informed of what is going on. There are occasion when the union
representatives participate in rating the jobs.
Usually the committee obtains the assistance of other specialists in preparing
job descriptions and developing a suitable job evaluation scheme. Outside
consultants may render this help directly or by training the company
employees to carry out the different aspects of the work involved.
The main function of the committee is to maintain liaison with management,
different groups of employees and specialists at work. They check up
progress of work at periodic intervals and carry out rating of jobs and classify
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them. However it is possible for the committee to carry out the entire work. Job Evaluation and
Internal Equity
The committee serves in an advisory capacity.
The Job Evaluation Committee completes a stage when it presents a report
containing job descriptions, evaluation system, classification of jobs, results
of wage survey, tentative formula for conversion of points into monetary
terms and procedure for implementation. All the time and efforts spent upto
this stage proves to be useful only if the recommendations are implemented
by the management. There are several factors that contribute to the nature and
extent of implementation of the recommendations.

In most cases, work up to the point of preparation of reports runs fairly

smoothly, and from that point onwards, the situation becomes more difficult
and critical. The continued interest of the management and the union makes it
possible to tide over their difficulties at the stage of implementation, in fact,
the degree of cooperation during implementation is a consequence of
continued cooperation from all the parties concerned right from the beginning
In addition the development of proper attitudes, there is also need for
developing procedures for maintaining the system including a grievance
handling system. These procedures are fairly simple and are practiced in
companies where the job evaluation system is continuously in use. In spite of
thorough work prior to the preparation of report and advance planning for
implementation, problems of various kinds come up. These problems can be
dealt with keeping in mind the limits set by the Job Evaluation System.

7.7 SUMMARY
Job Evaluation work aims primarily at establishing a rational and fair basis
for developing a suitable wage structure. There are other advantages derived
from this work. Improvements in organisation procedures, better personnel
administration and improved morale are some of the results of developing a
wage structure on a factual bais.

7.8 SELF-ASSESSMENT QUESTIONS

1. What is internal equity & How is it relevent ?
2. Job Evaluation is a continuous process. Explain why?
3. Write down the procedure of Job Evaluation.
4. Name down the various methods of systems of Job Evaluation. Also
write advantages and disadvantage of any two.
5. Explain Job Analysis and Job Description.
6. Write Short Notes on:
i Time-Span of Discretion Method
ii. Decision Band Method
iii. Job Assessment
iv. Point Rating Method
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Legal Frameworks of 7. "Job Evaluation is not a. Scientific but a Systernatic Procedure". Explain it.
Compensation and
Rewards
7.9 FURTHER READINGS
• Wage Systems by G.K.Suri
• Hand book of Salary and Wage Systems by Angela M. Bowey
• Wages in India by Subramanian
• Wage Determination by Sinha PRN
• Job Evaluation - A Critical Review by Bryan Livy
• Job Evaluation Methods - by Lytle
• Job Evaluation Vol 1 & 2 by Peterson

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