JOB EVALUATION SCHEME
1.1 What is Job Evaluation?
Job evaluation is a systematic process for defining the relative worth or size of jobs or roles within an organisation in order to establish internal relativities and provide the basis for designing an equitable grade structure, grading jobs in the structure and managing relativities.
1.2 Equal Pay for Equal Value – the Legal Position
If an employer wishes to defend an equal pay claim, equal pay legislation requires the job evaluation study to have been done by an analytical method, i.e. the study should have been undertaken with a view to evaluating ‘in terms of the demands made on a worker under various headings (for instance, effort, skill, decision)’. The employer must demonstrate the absence of sex bias in the job evaluation scheme, and jobs will be held to be covered by a job evaluation scheme only if they have been fully evaluated using the scheme’s factors. Slotting whole jobs against benchmarks is insufficient.
Employers must also comply with the General Statutory Duty placed upon them by The Equality Act 2010. This Act became law in October 2010 and replaces previous legislation and ensures consistency in what you have to do to make your workplace a fair environment and to comply with the law.
1.3 Types of Job Evaluation Schemes
There are two basic types of job evaluation schemes, known as "non-analytical" and "analytical". We offer advice on both non-analytical and analytical job evaluation schemes.
1.3.1 Non-analytical Schemes
The defining feature of non-analytical evaluation schemes is that whole jobs are compared with each other without any attempt to break down and analyse jobs under their various demands or components. These types of job evaluation schemes are particularly prone to sex discrimination because where whole jobs are being compared (rather than scores on components of jobs) judgements made by the evaluators can have little objective basis other than the traditional value of the job.
1.3.2 Analytical Schemes
Analytical evaluation schemes are schemes where jobs are broken down into components (known as factors) and scores for each component of the job are awarded with a final total giving an overall rank order.
1.4 Types of Non-Analytical Schemes
There are 4 types of non-analytical job evaluation scheme.
1.4.1 Job Ranking
Ranking is the process of comparing whole jobs with one another and arranging them in order of their perceived value to the organisation. Job ranking is a simple process which reflects what people tend to do when comparing jobs, but:
- there are no defined standards for judging relative worth and there is therefore no rationale to defend the rank order - it is simply a matter of opinion
- ranking is not acceptable as a method of determining comparable worth in equal value cases
- it may be hard to justify slotting new jobs into the structure or to decide whether or not there is a case for moving a job up the rank order, i.e. re-grading
1.4.2 Paired Comparisons
This is also a relatively simple technique. Each job is evaluated as a whole with each other job in turn, and points (0, 1 or 2) awarded according to whether its overall importance is judged to be less than, equal to, or more than the other jobs. Points awarded for each job are then totalled and a rank order produced. This method of job evaluation has all the advantages of job ranking and is slightly more systematic. However, it is best limited to organisations with a maximum of 30 jobs in a particular job population and, like job ranking; it does not involve any analysis of jobs nor indicate the extent of difference between them. Paired comparisons is not acceptable as a method of determining comparable worth in equal value cases
1.4.3 Internal Benchmarking or Job Matching
Job evaluation by internal benchmarking or job matching simply means comparing the job under review with any internal benchmark job which is believed to be properly graded and paid and slotting the job under consideration into the same grade as the benchmark job. The comparison is usually made on a whole job basis without analysing the jobs factor by factor. Internal benchmarking is a simple and quick method of job evaluation, but:
- it relies on judgements which may be entirely subjective and could be hard to justify
- it is dependent on the identification of suitable benchmarks which are properly graded and such comparisons may only perpetuate existing inequities
- it is not acceptable as a defence in equal value cases
1.4.4 Job Classification
Job classification is the process of slotting jobs into grades by comparing the whole job with a scale in the form of a hierarchy of grade definitions. It is based on an initial definition of the number and characteristics of the grades into which jobs will be placed. The grade definitions may refer to such job characteristics as skill, decision making and responsibility. Job classification is the most used form of non-analytical job evaluation because it is simple, easily understood and at least, in contrast to whole-job ranking, it provides some standards for making judgements in the form of the grade definitions. But:
- it cannot cope with complex jobs which will not fit neatly into one grade
- the grade definitions tend to be so generalised that they may not be much help in evaluating border-line cases
- it fails to deal with the problem of evaluating and grading jobs in dissimilar occupational or job families where the demands made on job holders are widely different
- grade definitions tend to be inflexible and unresponsive to changes affecting roles and job content
- the grading system can perpetuate inappropriate hierarchies
- it does not provide a defence in equal value cases.
1.5 TYPES OF ANALYTICAL JOB EVALUATION SCHEMES
1.5.1 Points Rating
This is the most commonly used method. The key elements of each job, which are known as 'factors', are identified by the organisation and then broken down into components. Each factor is assessed separately and points allocated according to the level needed for the job. The more demanding the job, the higher the points value. This scheme has the following advantages:
- it provides a rationale why jobs are ranked differently
- it may be entered as a defence to an equal value claim
- it will be seen generally as less subjective than non analytical techniques.
However, it is time consuming to introduce and can be complex and costly to undertake. In addition it can be seen to be an inflexible form of job evaluation in times of rapid change and can imply an arithmetical precision which is not justified.
1.5.2 Factor Comparison
Factor Comparison is similar to Points Rating job evaluation scheme, being based on an assessment of factors, though no points are allocated. Use of the Factor Comparison method of job evaluation is not as widespread as the Points Rating systems, because the use of points enables a large number of jobs to be ranked at one time.
1.5.3 'Tailor Made' or 'Off the Peg'
A prime consideration in deciding which analytical job evaluation scheme to select lies in the choice of factors and weightings. The benefit of proprietary 'off the peg' evaluation schemes is that they normally have been well tried and tested and there is therefore a saving in time. In addition, many schemes are linked to mechanisms for checking salary levels. The benefit of 'tailor made' schemes is that the factors and definitions more accurately reflect the range of jobs to be evaluated and are arrived at through consensus; consequently they are more likely to be acceptable to the workforce.
1.6 Basic Characteristics of Job Evaluation Methods
The diagram below highlights the main differences between the extremes of job evaluation schemes.
|Job ranking:||very subjective||simple||quick||difficult to defend, equal value claim, difficult to do with lots of jobs|
|Factor Analysis:||least subjective||complex||time consuming||easy to defend,
equal value claim,
Easy to do with lots of jobs
Despite their complexity and the amount of time required to complete them, analytical methods are much more popular than non-analytical methods. Most companies obviously prefer more objective methods which can easily defend an equal pay claim.