Job-Based Structures and Job Evaluation

Job analysis and job descriptions collected and summarized work information. There is an equally important process to place value on jobs, how to assess that value, and how to translate it into a job-based structure. Job evaluation is a process for determining relative value. Job evaluation is the process of systematically determining the relative worth of jobs to create a job structure for the organization. The evaluation is based on a combination of job content, skills required, and value to the organization. Content refers to what work is performed and how it gets done. Perspectives differ on whether job evaluation is based on job content or job value. Internal alignment based on content orders jobs on the basis of the skills required for the jobs and the duties and responsibilities associated with the jobs. A structure based on job value orders jobs on the basis of the relative contribution of the skills, duties, and responsibilities of each job to the organization’s goals. Job value may also include the job’s value in the external market (exchange value). Plus, pay rates may be influenced by collective bargaining or other negotiations. In addition, the value added by the same work may be more (or less) in one organization than in another. Some see job evaluation as a process for linking job content and internal value with external market rates. Aspects of job content (e.g., skills required and customer contacts) take on value based on their relationship to market wages. Because higher skill levels usually commands higher wages in the labor market, then skill level and nature of customer contacts become useful criteria for establishing differences among jobs. Job evaluation is an important tool for organizations that wish to differentiate themselves from competitors if, for example, their particular strategy relies more heavily on certain jobs or skills than is the case in other organizations. Some researchers say the only fair measure of job value is found in the external market.