Methods of Job

Evaluation
Joaquin, Kim Sharlyn D.
MPA - Fiscal Administration
Prof. Rosette Librea

Top Four Methods of Job Evaluation

Non-quantitative Methods

Ranking method or Job comparison

Grading method or Job classification

Quantitative Methods

Point rating method

Factor comparison method

Job Evaluation

Systematic way of determining the value or worth of a job in relation to other

jobs in an organization

Job evaluations are used to determine the comparative worth of each job,
which will then help determine the basis of the wages and salaries offered for
each job.

Ranking Method

This method involves putting all jobs in an organization in rank order of

importance based upon their contributions towards the achievement of an
organization's goals.

All jobs are ranked in the order of their importance from the simplest to the
hardest or from the highest to the lowest.

Ranking Method
The application of the Ranking Method involves the following procedure:
1.

Utilizing job descriptions

2.

Making paired comparisons

3.

Ranking along a number line

a.

Supervision and leadership of subordinates

b.

Cooperation with associates outside the line of authority

c.

Probability and consequence of errors

d.

Minimum experience requirement

e.

Minimum education required

Ranking Method

Merits
1. It is the simplest method.
2. It is quite economical to put it into effect.
3. It is less time consuming and involves little paper work.

Demerits
1. The main demerit of the ranking method is that there are no definite standards of
judgment and also there is no way of measuring the differences between jobs.
2. It suffers from its sheer unmanageability when there are a large number of jobs.

Grading Method

Also known as classification method

job grades or classes are established by an authorized body or committee

appointed for this purpose.

A job grade is defined as a group of different jobs of similar difficulty or

requiring similar skills to perform them.

Grading Method
Class

Rank

Employees

Class 1

Executives

Office manager, Deputy

office manager, Office
superintendent, etc.

Class 2

Skilled Workers

Purchasing assistant,
Cashier, Receipts clerk,
etc.

Class 3

Semi skilled Workers

Stenotypists, Machine
operators, etc.

Class 4

Less skilled Workers

File clerks, Office boys,

etc.

Grading Method

Merits
1.

This method is easy to understand and simple to operate.

2.

It is economical and, therefore, suitable for small organizations.

3.

The grouping of jobs into classifications makes pay determination problems easy to
administer.

4.

This method is useful for Government jobs.

Demerits
1.

The method suffers from personal bias of the committee members.

2.

It cannot deal with complex jobs which will not fit neatly into one grade.

3.

This method is rarely used in an industry.

Point Rating Method

Under this method, jobs are broke down based on various identifiable factors
such as skill, effort, training, knowledge, hazards, responsibility, etc.

Points are allocated to each of these factors.

The jobs with similar total of points are placed in similar pay grades.

Point Rating Method

The procedure involved in determining job points is as follows:

1.

Determine the jobs to be evaluated.

2.

Decide on the factors to be used in analyzing and evaluating the jobs.

3.

Define the factors clearly in written.

4.

Determine degrees of each factor and assign point value to each degree.

5.

Point values are assigned to different degrees on the basis of arithmetic

progression.

6.

Finally, money values are assigned to points.

Point Rating Method

Merits
1.

It is the most comprehensive and accurate method of job evaluation.

2.

Prejudice and human judgment are minimized, i.e. the system cannot be easily manipulated.

3.

Being the systematic method, workers of the organization favor this method.

4.

The scales developed in this method can be used for long time.

5.

Jobs can be easily placed in distinct categories.

Demerits:
1.

It is both time-consuming and expensive method.

2.

It is difficult to understand for an average worker.

3.

A lot of clerical work is involved in recording rating scales.

4.

It is not suitable for managerial jobs wherein the work content is not measurable in quantitative
terms.

Factor Comparison Method

Ranking and point methods

This system is usually used to evaluate white collar, professional and

managerial positions.

Factor Comparison Method

Steps in Factor Comparison method:

1.

The key or benchmark jobs are selected as standards.

2.

The factors common to all jobs are identified, selected and defined precisely.

3.

Once the key jobs are identified and also the common factors are chosen, the key
jobs are, then, ranked in terms of the selected common factors.

4.

The next step is to determine a fair and equitable base rate and, then, allocate this
base rate among the five common factors as mentioned earlier.

5.

The final step in factor comparison method is to compare and evaluate the remaining
jobs in the organization.

Factor Comparison Method

Key Job

Daily
Wage
Rate

Physical
Effort

Factors
Mental
Effort

Skill

Responsib Working
ility
Condition
s

Electrician 60

11(3)

14(1)

15(1)

12(1)

8(2)

Fitter

50

14(1)

10(2)

9(2)

8(2)

9(1)

Welder

40

12(2)

7(3)

8(3)

7(3)

6(3)

Cleaner

30

9(4)

6(4)

4(5)

6(4)

5(4)

Laborer

25

8(5)

4(5)

6(4)

3(5)

4(5)

Factor Comparison Method

To illustrate, a painter job is to be evaluated. After comparison, it is found

that its skill is similar to electrician (15), mental effort to fitter (10) Physical
effort to welder (12), working conditions to laborer (4) and responsibility to
cleaner (6). Thus, the wage rate for the job of painter will be 47
(15+10+12+4+6).

Factor Comparison Method

Merits:
1.

It is more objective method of job evaluation.

2.

The method is flexible as there is no upper limit on the rating of a factor.

3.

It is fairly easy method to explain to employees.

4.

The use of limited number of factors (usually five) ensures less chances of overlapping and
over-weighting of factors.

5.

It facilitates determining the relative worth of different jobs.

Demerits:
1.

It is expensive and time-consuming method.

2.

Using the same five factors for evaluating jobs may not always be appropriate because jobs
differ across and within organizations.

3.

It is difficult to understand and operate.

SUMMARY
Scheme

Characteristics

Advantages

Disadvantages

Ranking

Whole job
comparisons are
made to place them
in order of
importance

Easy to apply and

understand

No defined
standards of
judgementdifferences between
jobs are not
measured

Grading

Job grades are

defined and jobs are
slotted into the
grades by comparing
the whole job
description with the
grade definition

Simple to operate
and standards of
judgement are
provided in the
shape of the grade
definitions

Difficult to fit
complex jobs into
one grade without
using excessively
elaborate grade
definitions

SUMMARY
Scheme

Characteristics

Advantages

Disadvantages

Point rating

Separate factors are

scored to produce an
overall points score
for the job

The analytic process

of considering
separate defined
factors provides for
objectivity and
consistency in making
judgements

Complex to install
and maintainjudgement is still
required to rate jobs
in respect of different
factors

Factors comparison

Jobs graded by
Realistic, practical,
reference to market
straightforward and
rate data and direct
quick
comparisons with jobs
at or near the same
level within the
organization

Market rate
information maybe
difficult to obtain or
inaccurate

Sources

Singh, S. (2013). Job Evaluation. Retrieved 1 December 2016 from http://

www.slideshare.net/kakhwarisandeep/job-evaluation-16452457

RMS (2013). What are the different methods of job evaluation?. Retrieved 1
December 2016 from http://
www.educationobserver.com/forum/showthread.php?tid=12836

Chand, S. (2016). Top 4 methods of Job Evaluation. Retrieved 29 November

2016 from
http://www.yourarticlelibrary.com/hrm/jobs/top-4-methods-of-job-evaluati
on-explained-with-diagram/35338/

Grimsley, S. (n.d.) Four Methods of Job Evaluation: Ranking, Classification,

Point & Factor Comparison. Retrieved 27 November 2016 from
http://study.com/academy/lesson/four-methods-of-job-evaluation-rankingclassification-point-factor-comparison.html#transcriptHeader