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Classification Performance Management

Job/Work Evaluation

Definition Job evaluation is a formal process for:
  • determining the relative value of various jobs within the organization, and
  • assigning jobs to a grade structure or some other hierarchical index of job value.
The term "work evaluation" often has the same meaning as "job evaluation," but also includes methods for valuing work that are not centered on job tasks. For example, work evaluation could be based on roles or competencies.
Purpose of job evaluation Job evaluation helps organizations establish coherent relationships among positions. Common functions of job evaluation include:

Function

Application(s) of job evaluation:

Employment
  • identify "families" of occupations,
  • identify skills and competencies needed for successful performance,
  • evaluate "fit" between candidates and job requirements, and
  • develop career paths.
Pay administration
  • develop a grade structure and pay ranges,
  • define key responsibilities and skills to aid in conducting salary surveys, and
  • assign jobs to a grade structure.

Internal equity

  • determine whether different jobs have comparable requirements and responsibilities, and
  • ensure compliance with the Equal Pay Act.
Methods of job evaluation Common methods of job evaluation include:

Method

Places a job in the job hierarchy by…

Market pricing using going market rates as the primary determinant of a job’s worth and pay.
Ranking ordering jobs based on their relative value to the organization.
"Job slotting" determining the job’s relationship to a set of predetermined benchmark jobs.

Whole-job evaluation

comparing the job to others with similar entry requirements, duties, and responsibilities.
Point-factor job evaluation
  • evaluating the job against a predetermined set of factors,
  • assigning a level or point value for each factor, and
  • translating the levels or points to a position in the job hierarchy.
Examples Examples of job evaluation include:
  • a Federal manager establishes a new position and assigns a General Schedule series, title, and grade under delegated classification authority,
  • a job evaluation committee, composed of management, HR, and employee representatives, assigns a position to a pay band based on the job’s competency requirements and scope, and
  • an employee’s position is reviewed and upgraded because of additional duties and responsibilities.
Any of these actions places the job in the grade structure or job hierarchy.
Choice of methods Practitioners consider several factors when selecting a job evaluation approach.

Method

Can be used when…

Market pricing
  • external equity is a primary objective
  • internal equity is not a primary objective
  • labor market matches and data are readily available
  • cost control is not a primary objective
Ranking
  • precision and internal equity is not a primary objective
  • the number of jobs is small
"Job slotting"
  • precision is not critical
  • benchmark jobs are readily available
  • simplicity and speed are important
Whole-job evaluation
  • speed is important
  • "big picture" is more important than precision
  • evaluators have broad organizational knowledge
  • documentation is not critical
Point-factor job evaluation
  • internal equity is important
  • validation and precision are important
  • consistent procedure and results are needed
  • job evaluation results must be documented and defended
  • resources are available for development and administration
Federal practice and history

The Federal Government uses job evaluation to determine a job’s title, series, and grade and, thereby, its pay range. 

Federal job evaluation focuses on job content – e.g., knowledge, supervisory controls, scope and effect. An employee’s personal qualities and performance generally have little impact on job evaluation.

The role of competencies in job evaluation is evolving, in both the public and private sectors. The Classification Act of 1949 delegated job evaluation (position classification) to agencies. To promote equity and consistency, the Civil Service Commission developed uniform job evaluation guides (classification standards).

In the 1970s, the Factor Evaluation System, a point-factor system that uses nine basic factors to evaluate white-collar positions, was introduced to make job evaluation more uniform, systematic, and understandable.

Public sector practice Formal job evaluation appears to be nearly universal among large public sector employers. All of the State governments that OPM has surveyed to date have job evaluation systems. States use job evaluation to:
  • identify qualification requirements,
  • place jobs in salary structures, and
  • maintain internal equity.
In some States, job evaluation is the sole determinant of a job’s grade or pay range. In other States, job evaluation results are used in conjunction with market rates, internal salary relationships, and other factors to assign a job to a grade or pay range.
Trends Most organizations continue to use formal, structured job evaluation systems. However, the precision and value of job evaluation are decreasing as work and positions become increasingly dynamic. Consequently, organizations are deemphasizing "scientific" job evaluation and:
  • emphasizing external equity (linking pay to external markets) over internal equity (linking pay to internal measures of job worth),
  • focusing attention on paying the person, rather than paying the job, and
  • focusing on measuring performance instead of job content.
Private sector practice Most large private sector organizations have formal job evaluation systems. OPM's survey of a cross-section of private sector firms found that:
  • market pricing and job slotting were the most common approaches,
  • a substantial minority used point factor systems, and
  • firms without a formal job evaluation system had monitoring and review mechanisms to ensure compliance with the Equal Pay Act.

Example: How internal equity might be analyzed for practices in this component.

Job/Work Evaluation varies across the dimension of internal equity from a Very High Level of internal equity (e.g., position classification with narrow grades) through a High/Moderate Level (e.g., banding) to a Very Low Level of internal equity (e.g., direct market pricing of the skills needed to perform a particular job). The workgroup might observe that job/work evaluation practices merit further consideration if they fall between Very High and Moderate on the internal equity dimension.

Workgroup Member Selection

These general and specific qualities would support a workgroup member's capacity to contribute.
General
  • Ability to represent the perspective of the organization on compensation issues.
  • Knowledge of human resources laws and policies.
  • Ability to analyze possible new compensation practices in broad context and to visualize their application in the Federal environment.
  • Ability to work on ad hoc teams.
Specific
  • Knowledge of Federal GS Classification System.
  • Knowledge of Federal exceptions to GS System - e.g., broadbanding.
  • Familiarity with other methods of job or work evaluation.
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