Job Evaluation is an important part of Human Resource Management. It is a comparative process. Job Evaluation is a formal and systematic way of determining the relative intrinsic value or worth of a job in relation to other jobs in an organisation. It is a process which is very helpful for framing compensation plans by the personnel manager. Job Evaluation begins with job analysis and ends at that point where the worth of a job is ascertained for achieving pay equity between jobs and different roles. The objective of job evaluation is to determine which jobs should get more pay than others. Job Evaluation is usually based on compensation factors rather than on the employee which means that job evaluation is done for ranking of job and not the job holder. As job holders are rated through performance appraisal. Several methods such as job ranking, job grading and factor comparisons are employed in job evaluation. Job Evaluation forms the basis for wages and salary negotiation. The value or worth of the job varies from time to time and from place to place under the influence of certain economic pressure. Some of the features of job evaluation are it helps in building a base for salary negotiation, it assesses the job and not the employee, Job Evaluation is done by a group of experts and not individuals, Job Evaluation is the output provided by job analysis, last but not the least it helps the management to maintain high level of productivity and satisfaction among employees which motivates them to work hard. The main point which must be understood is that job evaluation is about relationship and not absolutes it cannot be the sole determining factor for deciding pay structure. As there are many other external factors like labour market conditions and collective bargaining. The objectives of Job Evaluation are –
- To help in measuring the “intrinsic” worth of the job. This is based on the degree of complexity of job content and requirements.
- To provide a rational basis for equitable remuneration within an organisation.
- To rank the job in order of importance like job duties and responsibilities.
- It helps in providing framework for periodic of wage rates and its revision too.
- It helps in providing a benchmark for career planning of the employees in the organisation.
- To identify a ladder of progression for future movement to all employees interested in improving their compensation.
- To develop a base for merit or pay for performance.
Job Evaluation as a process is advantageous and important to a company in many ways:-
- Helps in Wage and Salary Fixation – Job Evaluation helps the management so that they can establish a rational and consistent wage and salary structure. It lays down the base or foundation for wage incentive plan.
- Helps in Recruitment and Selection – Job Evaluation provides useful information for recruitment of new employees. It is also helpful at the time of selection of candidates as the factors which we have determined for job evaluation can be taken into consideration while selecting the employee. Likewise, promotion, transfer and so on can be made on a rational basis for different employees in the organisation.
- Improves Labour-Management Relation – Job Evaluation helps in eliminating wage inequalities within the organisation. And thus it helps in bringing and maintaining harmonious relationship between Employee and Employer
- Fair Distribution of Rewards – As each and every human likes to get rewarded same goes with employees. They should be rewarded fairly in relation to others in the organisation and it helps to ensure that rewards are allocated without any discrimination.
- Helps in Analysis of Company – It acts as a valuable tools for the analysis of a company. As it helps in identifying that whether there is any gap or overlap in responsibility.
As we know Job Evaluation is a very important part of Human Resource Management as it determines the worth of the job in the organisation.