Compensation: Chapter 5- Job Based Structures (Test 2)

Structures based on job value order jobs: on the basis of the relative contribution of the skills, duties, and responsibilities.

How are structures based on job value ordered?

Complex procedures and bureaucracy can cause users to lose sight of the objectives...ask yourself: "how does this help accomplish our objectives" and do not solely focus on the "how-to" Must stay flexible while maintaining guidelines (maintain fairness).

How do you balance chaos and control?

Create user manual so other people can apply the plan. Manual describes the method, defines compensable factors, and provides enough information to permit users to apply the plan as intended. Should strive for high interrater reliability.

How do you communicate the plan and train users?

Remember: JE is supposed to help establish an internally aligned pay structure. Alignment occurs when: -Supports the organizational strategy -Supports the workflow --Integrates each job's pay with relative contributions --Helps set pay for new, unique, or changing jobs -Is fair to employees -Motivates behavior toward organizational objectives

How do you establish the purpose?

Keep in mind the objectives of the job evaluation process. Consider if results of JE: Help establish internal alignment Supports the organizational strategy Is fair to employees Motivates behavior toward organizational objectives

How do you evaluate the results of a job evaluation?

Reflect different degrees within each factor. Most factor scales consist of four to eight degrees.

How do you scale compensable factors?

How are structure based on job content ordered?

Structures based on job content order jobs by: skill, duties, and responsibilities.

Representative sample should include entire domain of work for as many levels in the structure and groups of related jobs as possible. When choosing what to Include: Contents are well known and stable over time Job is common across a number of different employers Reasonable proportion of workforce employed in this job

What are benchmark (key) jobs?

Compensable factors are characteristics in the work that the organization values, and that help it pursue its strategy and achieve its objectives.

What are compensable factors?

Knowledge, skills, and abilities necessary to perform the job

What are job specifications?

Advantage: Can group a wide range of work together in one system Disadvantage: Descriptions may leave too much room for manipulation

What are the advantages and disadvantages of classification?

Advantage: Compensable facors call out basis for comparisons. Compensable factors communicate what is valued Disadvantage: Can become bureaucratic and rule-bound

What are the advantages and disadvantages of point?

Advantage: fast, simple, easy to explain Disadvantage: cumbersome as number of jobs increases. Basis for comparison is not called out. Can create problems (with expensive solutions) because it does not tell employees or managers what it is about their jobs that is important

What are the advantages and disadvantages of ranking?

1. Conduct job analysis 2. Determine compensable factors. 3.Scale the factors. 4. Weight the factors by importance 5. Select criterion pay structure. 6. Communicate the plan and train users. 7 . Apply to remaining jobs. 8. Develop online support.

What are the eight steps in designing a point plan?

1. Ranking 2. Classification 3. Point

What are the methods you can choose from for a job evaluation?

Uses a matrix to compare all possible pairs of jobs. When all comparisons are completed, the job judged "more valuable" becomes the highest ranked job, and so on.

What is paired comparison?

Common Characteristics: 1. Compensable factors based on: Strategic direction of the business How the work contributes to the objectives and strategy 2. Factor degrees numerically scaled 3. Weights reflect the relative importance of each factor

What is point method?

Orders job descriptions from highest to lowest based on a global definition of relative value or contribution to the organization's success.

What is ranking?

Typically, work content is too diverse to be usefully evaluated by one plan, so organizations usually utilize multiple evaluation plans. Usually focus on related groups of jobs, like: manufacturing, technical, or administrative Start with a sample of benchmark (key) jobs.

What is single vs. multiple plans?

Stakeholders can reach consensus on value

What is the assumption of assessment of relative value?

Content has intrinsic value outside of external market

What is the assumption with assessment of job content?

Value cannot be determined without external market

What is the assumption with external market link?

Criteria: 1. Are the number of degrees sufficient to distinguished among jobs? 2. Is the terminology understandable? 3. Do my degree definitions anchor to benchmark jobs? 4. Is it apparent how the degree applies to the job?

What is the criteria for scaling compensable factors?

The criterion pay structure is a pay structure duplicated from a point plan chosen by committees.

What is the criterion pay structure?

Must consider: fairness! Cannot just focus on results (internal pay structure). Must include: appeals/review procedures. Fairness in process and approach results in employee and management: Commitment Trust Acceptance of results

What is the design process of a job evaluation?

Based on: job content, skills required, value to the organization, org culture, and external market

What is the job evaluation based on?

1. Job Analysis 2. Job Description 3. Job Evaluation 4. Job Structure

What is the order of determining a job structure?

Purpose: create a job structure

What is the purpose of a job evaluation?

Decide what content is valuable to the external market. Typically, higher skill levels or working closely with customers commands higher wages. These become useful criteria for establishing differences among jobs.

How do you link content with the external market?

Reflect the relative importance of each factor to the overall value of the job. Different weights reflect differences in importance attached to each factor. Usually decided by an advisory committee.

How do you weigh compensable factors?

1. Establish the purpose 2. Decide on single versus multiple plans 3. Choose among alternative methods 4. Obtain involvement of relevant stakeholders 5. Evaluate the usefulness of the results

What are the major decisions of the job evaluation process?

Relationship among jobs inside an organization, based on work content and each job's relative contribution to achieving the organization's objectives. A hierarchy of work. Organizations commonly have multiple structures derived from different approaches that are applicable to different functional groups.

What are the outcomes of a job structure?

How many factors should be included -Make sure they account for unique criteria "small numbers" -If one job in our benchmark sample has a certain characteristic, we tend to use that factor for the entire work domain E.g., "working conditions" did not vary among 90% of jobs

What are things to consider when determining compensable factors?

Can be based on: 1. Current rates paid for benchmark jobs 2. Market rates for benchmark jobs 3. Rates for jobs held predominately by males 4. Union-negotiated rates

What can the criterion pay structure be based on?

The job analysis - job description - job evaluation process is a structure translating the internal alignment policy into practice.

What does the job structure process determine?

A systematic method to discover and describe similarities and differences among jobs.

What is a job analysis?

Tasks, duties, and responsibilities that make up a job.

What is a job description?

Job evaluation is the process of systematically determining the *relative worth* of jobs.

What is a job evaluation?

Orders job descriptions alternately at each extreme. Evaluators agree on which jobs are the most and least valuable, then the next, etc.

What is alternation ranking?

A series of classes covers the range of jobs. Job descriptions are compared to class descriptions to determine class level. Greater specificity of the class definition improves the reliability of the evaluation. It also limits the number of jobs easily classified. Jobs within each class are considered equal and will be paid equally.

What is classification?

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

What is content?

Should be based on: the strategy and values of the organization the work performed what is considered acceptable to the stakeholders affected by the resulting pay structure

What should compensable factors be based on?

Common approach: use committees, task forces, or teams made up of representatives from key operating functions (e.g., managers and employees).

Who is involved in a job evaluation?