Job Evaluation definition
A systematic, formal process that allows organisations to compare jobs to others across the company and the industry. Job evaluation is often seen as the foundation for a fair and efficient pay framework.
Job evaluations may be carried out in order to help businesses:
- Produce a fair pay framework
- Reduce inefficiencies in remuneration e.g. two people on the same ‘level’ with different salaries
- Compare remuneration with other companies
- Design new jobs, departments and functions
- Rework their pay framework after a company re-organisation
Job evaluation differs from job analysis – the latter is the process of gathering information about a job, whereas job evaluation goes a stage further by placing a relative value on a job so that a fair and suitable pay framework can be produced.
Job evaluation can be quite an invasive process, particularly if the analysis runs deeply, which means HR must consider and mitigate the effect on employees. A good relationship with unions and employees is important.
Employees are welcome to appeal against plans put into place as a result of a job evaluation. Companies should have established procedures – separate from the standard grievance procedures – for dealing with these appeals.
One of the biggest criticisms of job evaluation is that it is conducted from the employer’s point of view. Other stakeholders, such as employees and unions, may ascribe greater importance to certain factors than employers.