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(1) Point Method—This method is most widely used system of job evaluation. It involves a more detailed, quantitative and analytical evaluation of jobs. It requires identifying a number of compensable factors i.e. various characteristics of jobs and the determining degree to which each of these factors is present in the job. A different number of points is usually assigned for each degree, of each factor. According to Dale S. Beads— "Every point plan consists of a number of compensable job factors or characteristics. This can be classified under four headings of skill, effort, responsibility, and job conditions."
Following are the steps involved in point method:
(i) Determination of Type of Job-The jobs in any organisation will range from the top executive down to watchman, each involving different skills, responsibility, efforts, and working conditions. Many of the jobs are unskilled also. There should be separate evaluation programme for different categories of jobs. It would be better to select 'key* or 'benchmark' jobs which represent each major level of duties, efforts and skills for each classification of jobs to be rated. It enables to work with relatively few jobs in selecting factors.
(2) Factor Comparison Method—Thomas E. Hitten was the first to originate factor comparison -method of job-evaluation. This method determines the relative rank of the jobs to be evaluated in relation to monetary scale. It is often used in evaluating, the managing administrative and white-collared jobs. It is essentially a combination of the ranking and point systems. Like the rank order method it rates jobs by comparing one with another. Like the point system, it is more analytical in the sense of sub-dividing jobs into compensable factors and finds ratings one expressed in terms of numbers. These factors are not predetermined and chosen on the basis of job-analysis. The most widely used factors are (a) mental requirements (b) skill requirements, © physical requirements (d) responsibilities and (e) working conditions.
Under this system, a few jobs arc selected as key jobs which serve as standard against which all other jobs are compared. Key job is one whose contents has been stabilised over a period of time and whose wage rate is considered to be presently correct by the management and the union. The steps in evaluating the job under this method can be enumerated as under:
(a) first, various factors (as given above) are selected and defined clearly.
(b) Secondly, key jobs are selected.
(c.) Thirdly, wages are fixed for different factors of each key job.
(d) Fourthly, a comparison scale is developed. Each key job should be fitted to it, when all the key jobs have been evaluated and wages allocated in this manner, a job comparison scale is constructed.
(e) Fifthly, jobs are evaluated factor by factor, in relation to key jobs on job comparison scale. Then each job is to be evaluated and compared to other jobs in terms of each factor, and
(f) Lastly, a wage structure is designed, adjusted and operated.
The system is usually used to evaluate white collar, professional and managerial positions.
(ii) Selection of Factors—A factor is a distinguishing feature of a job. In the selection of factors, the following points should be kept into consideration: (a) factors chosen must be rateable, (b) factors must not be too many, © factors must not overlap in meaning, and (d) factors must meet both employer and employee standards.
It is very difficult to lay down the exact number of factors which should be used for evaluating a job. C.W. Lytie, after analysing the problem of the number of factors, feels that there are only four major job characteristics, namely skill, effort, responsibility and working conditions. These factors are genei^_ divided into a number of sub-factors called specific factors. A possible division of general factors i specific factors is given below :
Skill: Education, experience, training, judgment.
Responsibility : Machinery and equipment used, raw-materials used, quality of output, work of others.
Effort: Physical and mental.
Working Conditions : Working environment, accident hazard, discomfort, etc.
Each of the above mentioned general and specific factors must be defined precisely. It would ensure consistency in evaluation by different job evaluators.
(iii) Construction of Factor Scales—The next step is to construct factor scale. It will include (a) determine relative value of each factor (b, determine degree of each factor and © assign point values to each degree factor.
(iv) Evaluation of jobs— After the construction of scales the task of evaluation can be started. Read job analysis information carefully. Compare it with degree definitions. Decide at which degree the job falls and obtain the points. Do it with each factor and total up to the points so obtained. This will give worth of job in terms of points.
(v) Conducting the wage survey-When the worth of jobs in terms of points is available, the next logical step is to convert these into money value. For this purpose, a wage survey must be conducted to know what wages are being paid by others in the industry. This information should be collected in respect of only the representative jobs.
(vi) Design the wage structure-Management takes a decision what kind of wage structure does it wish to have. There are two main kinds of wage structure in vogue:
(1) In the first kind same amount of wages are paid to each job falling in any particualr job class. The rates do not vary within a particular job class.
(2) In the second kind the wages change not only between different job classes but also within the job classes.
(vii) Adjusting the existing wage structure—The wage structure designed in the preceding step is the one to which the existing structure must conform. Those who are getting less than what they should as per the new wage structure should get a wage raise. But those who are getting more should not have their wages reduced. Instead such job should be "red circled" so that when the occupant leaves the organisation, the job in question is either eliminated or changed or when the new person occupies it he is given "appropriate" wage.
