Chapter 5

Why does the design process matter?

- Attend to the fairness of the design rather than the results - review procedures help ensure procedural fairness - powerful member of the job evaluation committee may sway results

To be useful, compensable factors should be:

- Based on the strategy and values of the organization. - Based on the work performed. - Acceptable to the stakeholders affected by the resulting pay structure.

Communicate and Train Users

- a manual allows others to apply the plan - users will require training on how to apply the plan

Classification consists of:

- a series of classes that cover the range of jobs - class descriptions as labels - compare job descriptions to class descriptions to find the best fit - the label captures work detail yet is general enough to cover jobs - describe classes further with titles of benchmark jobs

Acceptable to the stakeholders

- acceptance of compensable factors may depend on tradition - so the question is, acceptable to whom?

Employee acceptance of the process is crucial to build this:

- communicate to all employees whose jobs are part of the process used to build the structure - communicate through informational meetings, websites, or other methods

Point Method three common characteristics

- compensable factors - factor degrees are numerically scaled - weights reflect the relative importance of each factor

What are the eight steps in the design of a point plan?

- conduct job analysis - determine compensable factors - scale the factors - weight the factors according to importance - select criterion pay structure - communicate the plan and train users - apply to nonbenchmark jobs - develop online software support

Criteria for scaling factors

- ensure the number of degrees is necessary to distinguish jobs - use understandable terminology - anchor definitions with benchmark job titles and work behaviors - make it apparent how the degree applies to the job

Job evaluation helps establish an aligned pay structure which

- supports organization strategy — answers the question: how does the job add value? - supports work flow — integrates the job's pay with its relative contribution to the organization, helps set pay for new, unique, or changing jobs - is fair to employees — reduces disputes and grievances over pay differences - motivates behavior toward organization objectives — shows ees what about their work is valued, helps ees adapt to organization changes, helps create the network of rewards

What is job evaluation based on?

A combo of job content, skills required, value to the organization, organizational culture, and the external market

Job evaluation

A process for determining relative value, its the process of systematically determining the relative worth of jobs to create a job structure for the organization

What is the final result of this entire process?

A structure, a hierarchy of work that translates an internal alignment policy into practice

Compensable factors

Are based on the strategic direction of the business and how the work contributes to these objectives and strategy

Most factor scales

Consist of four to eight degrees - in practice, evaluators use undefined degrees - another issue is whether to make each degree equidistant from adjacent degrees

Statistical modeling (Select criterion pay structure)

Determines the weight for each factor and the factor scales that will reproduce the chosen structure

What to do if some aspect of job content is not related to wages?

Eliminate that aspect from the job evaluation

What is content?

It refers to what work is performed and how it gets done

Alternation ranking

Orders job descriptions alternately at each extreme

Structure based on content

Orders jobs by skills, duties, and responsibilities

Structure based on job value

Orders jobs by the relative contribution of the skills, duties, and responsibilities to the organization's goals

Apply and support

The final step is to apply the plan to remaining jobs - once its developed it becomes a tool for managers and HR - the last step is to develop online software support

Hay Group Guide Chart-Profile Method

The hay factors are know-how, problem solving, and accountability

benchmark jobs

They capture all aspects of the work - its contents are well known and relatively stable over time - the job is common across employers - a reasonable proportion of the work force holds this job

Some say if job evaluation can be rigorous and systematic, then it can be judged according to technical standards T/F?

True

Some see job evaluation as a way to link job content and internal value with external market rates T/F?

True

Paired comparison

Uses a matrix to compare all possible pairs of jobs

Based on the work itself

Work related documentation helps gain acceptance by employees, is easier to understand, and withstands challenges to the pay structure

Who are primarily responsible for job evaluation of most jobs?

compensation professionals

Ranking

simply orders the job descriptions from highest to lowest based on relative value or contribution to the organization's success

Some major decisions in job evaluation when determining an internally aligned job structure

- establish purpose of evaluation - decide whether to use single or multiple plans - choose among alternative approaches - obtain involvement of relevant stakeholders - evaluate plan's usefulness

What are the major decisions in the job evaluation process include?

- establishing the purpose - deciding on single versus multiple plans - choosing among alternative methods - Obtaining involvement of relevant stakeholders - evaluating the usefulness of the results

What are the drawbacks to ranking?

- if ranking criteria is poorly defined, evaluations become only opinions - evaluators must be knowledgeable about every single job under study - results are difficult to defend and costly solutions may be required

Based on the strategy and values of the organization

- if the direction changes, then compensable factors may also change - factors may be eliminated if they no longer support business strategy

Who should be involved?

- managers and employees with a stake in the results should be involved in the design process

Factor weights

- reflect the relative importance of each factor - advisory committees often determine weights

Factors tend to fall into four generic groups and are included in the equal pay act as well as the National Electric Manufacturers Association plan (NEMA)

- skills required - effort required - responsibility - working conditions

What are some things about evaluation?

- some say evaluation uncovers job content with intrinsic value, and other say the only fair measure of job value is in the external market - some say contemporary job evaluation practices are just and fair, and others say they are just fair

Why is it important when choosing a job evaluation method?

Research consistently finds that different job evaluation plans generate different pay structures