Chapter5

Performance and Job Evaluation

Concept of job evaluation:
In simple words, job evaluation is the rating of jobs in an organization. This is the process of establishing the
value or worth of jobs in a job hierarchy. It attempts to compare the relative intrinsic value or worth of jobs
within an organization. Thus, job evaluation is a comparative process.

Below are given some important definitions of job evaluation:

According to the International Labour Office (ILO) “Job evaluation is an attempt to determine and compare the
demands which the normal performance of a particular job makes on normal workers, without taking into
account the individual abilities or performance of the workers concerned”.

The British Institute of Management defines job evaluation as “the process of analysis and assessment of jobs to
ascertain reliably their negative worth using the assessment as the basis for a balanced wage structure”. In the
words of Kimball and Kimball “Job evaluation is an effort to determine the relative value of every job in a plant
to determine what the fair basic wage for such a job should be”.

Wendell French defines job evaluation as “a process of determining the relative worth of the various jobs within
the organization, so that differential wages may be paid to jobs of different worth. The relative worth of a job
means relative value produced. The variables which are assumed to be related to value produced are such
factors as responsibility, skill, effort and working conditions”.

Job evaluation provides basis for developing job hierarchy and fixing a pay structure. It must be remembered
that job evaluation is about relationships and not absolutes. That is why job evaluation cannot be the sole
determining factor for deciding pay structures.

External factors like labour market conditions, collective bargaining and individual differences do also affect
the levels of wages it, organizations. Nonetheless, job evaluation can certainly provide an objective standard
from which modifications can be made in fixing wage structure.

The starting point to job evaluation is job analysis. No job can be evaluated unless and until it is analysed. How
job evaluation is different from job analysis, job description and job specification is given in the following

1
Table 14.1.
Objectives of job evaluation:
The main objective of job evaluation is to determine relative worth of different jobs in an organisation to serve
as a basis for developing equitable salary structure. States an ILO Report the aim of the majority of systems of
job evaluation is to establish, on agreed logical basis, the relative values of different jobs in a given plant or
machinery i.e. it aims at determining the relative worth of a job. The principle upon which all job evaluation
schemes are based is that of describing and assessing the value of all jobs in the firms in terms of a number of
factors, the relative importance of which varies from job to job.

The objectives of job evaluation, to put in a more orderly manner are to:
1. Provide a standard procedure for determining the relative worth of each job in a plant.

2. Determine equitable wage differentials between different jobs in the organization.

3. Eliminate wage inequalities.

4. Ensure that like wages are paid to all qualified employees for like work.

5. Form a basis for fixing incentives and different bonus plans.

6. Serve as a useful reference for setting individual grievances regarding wage rates.

7. Provide information for work organization, employees’ selection, placement, training and numerous other
similar problems.

8. Provide a benchmark for making career planning for the employees in the organization.

2
Procedure of job evaluation:
Though the common objective of job evaluation is to establish the relative worth of jobs in a job hierarchy,
there is no common procedure of job evaluation followed by all organizations. As such, the procedure of job
evaluation varies from organization to organization. For example, a job e valuation procedure may consist of the
eight stages as delineated in Figure 14.1.

1. Preliminary Stage:
This is the stage setting for job evaluation programme. In this stage, the required information’s obtained about
present arrangements, decisions are made on the need for a new programme or revision of an existing one and a
clear cut choice is made of the type of programme is to be used by the organization.

2. Planning Stage:
In this stage, the evaluation programme is drawn up and the job holders to be affected are informed. Due
arrangements are made for setting up joint working parties and the sample of jobs to be evaluated is selected.

3. Analysis Stage:
This is the stage when required information about the sample of jobs is collected. This information serves as a
basis for the internal and external evaluation of jobs.

4. Internal Evaluation Stage:

Next to analysis stage is internal evaluation stage. In the internal evaluation stage, the sample of bench-mark
jobs are ranked by means of the chosen evaluation scheme as drawn up at the planning stage. Jobs are then
3
graded on the basis of data pending the collection of market rate data. Relative worth of jobs is ascertained by
comparing grades between the jobs.

5. External Evaluation Stage:

In this stage, information is collected on market rates at that time.

6. Design Stage:
Having ascertained grades for jobs, salary structure is designed in this stage.

7. Grading Stage:
This is the stage in which different jobs are slotted into the salary structure as designed in the preceding stage 6.

8. Developing and Maintaining Stage:

This is the final stage in a job evaluation programme. In this stage, procedures for maintaining the salary
structure are developed with a view to accommodate inflationary pressures in the salary levels, grading new
jobs into the structure and regarding the existing jobs in the light of changes in their responsibilities and market
rates.

In India, the Indian Institute of Personnel Management, Kolkata has suggested the following five steps to
be taken to develop a job evaluation programme:

1. Analyze and Prepare Job Description

2. Select and Prepare a Job Evaluation Programme/Plan

3. Classify Jobs

4. Install the Programme

5. Maintain the Programme

These steps are self-explanatory. Hence are not discussed in detail.

Advantages of job evaluation:

According to an ILO publication job evaluation offers the following advantages:
1. Job evaluation being a logical process and objective technique helps in developing an equitable and
consistent wage and salary structure based on the relative worth of jobs in an organisation.
4
2. By eliminating wage differentials within the organisation, job evaluation helps in minimizing conflict
between labour unions and management and, in turn, helps in promoting harmonious relations between them.

3. Job evaluation simplifies wage administration by establishing uniformity in wage rates.

4. It provides a logical basis for wage negotiations and collective bargaining.

5. In the case of new jobs, job evaluation facilitates spotting them into the existing wage and salary structure.

6. In the modem times of mechanisation, performance depends much on the machines than on the worker
himself/herself. In such cases, job evaluation provides the realistic basis for determination of wages.

7. The information generated by job evaluation may also be used for improvement of selection, transfer and
promotion procedures on the basis of comparative job requirements.

8. Job evaluation rates the job, not the workers. Organisations have large number of jobs with specialisations. It
is job evaluation here again which helps in rating all these jobs and determining the wages and salary and also
removing ambiguity in them.

Job Evaluation Methods

There are non-analytical and analytical job evaluation methods that are employed by the organizations to realize
the worth of a set of jobs.

5
 Non-analytical Job Evaluation Methods

1. Ranking Method: This is the simplest and an inexpensive job evaluation method, wherein the jobs are ranked
from he highest to the lowest on the basis of their importance in the organization. In this method, the overall job
is compared with the other set of jobs and then is given a rank on the basis of its content and complexity in
performing it.

Here the job is not broken into the factors, an overall analysis of the job is done. The main advantage of the
ranking method is, it is very easy to understand and is least expensive. But however it is not free from the
limitations, it is subjective in nature due to which employees may feel offended, and also, it may not be fruitful
in the case of big organizations.

2. Job Grading Method: Also known as Job-Classification Method. Under this method the job grades or classes
are predetermined and then each job is assigned to these and is evaluated accordingly.

For Example Class, I, comprise of the managerial level people under which sub-classification is done on the
basis of the job roles such as office manager, department managers, departmental supervisor, etc.

The advantage of this method is that it is less subjective as compared to the raking method and is acceptable to
the employees. And also, the entire job is compared against the other jobs and is not broken into factors. The
major limitation of this method is that the jobs may differ with respect to their content and the complexity and
by placing all under one category the results may be overestimated or underestimated.

Analytical Job Evaluation Methods

1. Factor-Comparison Method: Under this method, the job is evaluated, and the ranks are given on the basis of a
series of factors Viz. Mental effort, physical effort, skills required supervisory responsibilities, working
conditions, and other relevant factors. These factors are assumed to be constant for each set of jobs. Thus, each
job is compared against each other on this basis and is ranked accordingly. The advantage of this method is that
it is consistent and less subjective, thus appreciable by all. But however it is the most complex and an expensive
method.
2. Point-Ranking Method: Under this method, each job’s key factor is identified and then the subfactors are
determined. These sub-factors are then assigned the points by its importance.

For example, the key factor to perform a job is skills, and then it can be further classified into sub-factors such
as training required, communication skills, social skills, persuasion skills, etc.

The point ranking method is less subjective and is an error free as the rater sees the job from all the
perspectives. But however it is a complex method and is time-consuming since the points and wage scale has to
be decided for each factor and the sub factors.

Limitation of job evaluation-

The limitations of job evaluation are summarised as under:
(1) Not a scientific technique—Job evaluation is a systematic technique and not the scientific technique of
rewarding the job. Job evaluation lacks scientific precision because all factors cannot be measured accurately.
(2) Problem of adjustment—Though many ways of applying the job evaluation techniques are available rapid
changes in technology and in the supply and demand of particular spills have given rise to problems of
6
adjustment.
(3) Unrealistic—Substantial differences exist between job factors and the factors emphasised in the market.
These differences are wider in cases in which the average pay offered by a company is lower than that prevalent
in other companies in the same industry or in the same geographical area.
(4) Organisational Limitations—A job evaluation scheme takes a long time to install. It requires specialised
personnel and it is costly.
(5) Opposition by workers—Job evaluation is regarded by the trade unions with suspicion because it is made on
certain principles and results are generally ignored. Some of the methods of job evaluation are not easily
understood by workers. Workers fear that job evaluation will do away with collective bargaining.
(6) Subjective—Too many factors are used in job evaluation and moreover there is no standard list of factors to
be considered. Definitions of factors vary from organinsation to organisation. Many researches show that the
factors used are not independently be valued at all. It gives more reliance on internal standards and evaluation
for fixing wage rates.
Conclusion—Inspite of these limitations, job evaluation is very useful in evaluating the relative worth of the
job. Job evaluation provides a systematic study and assessment of the job and many complaints about disparity
in existing wage structures are removed by this technique. Although job evaluation not an exact science, it is a
systematic way of avoiding several anomalies in wages. Hence it can be concluded that job evaluation is not an
exact science. It is a technique which can help avoid several anomalies in wages that causes so much heart
burns and disgust today—provided it is used sensibly and is not pressed beyond its proper limits. While using
this technique, its limitations should also be considered.

Competency Matrix in the hospitality industry-

Hospitality, Tourism, and Events Competency Model

The Employment and Training Administration (ETA) has worked with the National Travel and Tourism Office
of the Department of Commerce and with technical and subject matter experts from education, business, and
industry to develop a comprehensive competency model for the Hospitality, Tourism, and Events industry. The
model identifies the knowledge, skills, and abilities that provide a foundation for industry workers, as well as
competencies specific to key sectors. While the model seeks to cover all workers in the industry, it is not
intended that each worker possess all of the competencies listed. The model is rather a compilation of
competencies that can be included as a basis for preparation in a Hospitality, Tourism, and Events occupation.

The American Hotel and Lodging Educational Institute; American Society of Travel Agents; The Broadmoor
Hotel; Destination Marketing Association International; International Association of Exhibitions and Events;
Madison Area Technical College; National Concierge Association; National Federation of Tourist Guides
Association; Purdue University College of Health and Human Sciences; and Richland College provided input to
development of the model. The International Association of Exhibitions and Events (IAEE) and Madison Area
Technical College have committed to providing technical assistance related to the model and to working with
their industry partners to ensure that the model evolves to accommodate changing skill requirements.

In 2017, the model was revised again to incorporate foundational workplace health and safety skills from the
National Institute for Occupational Safety and Health's (NIOSH) Safe • Skilled • Ready Workforce
Program designed to help protect America's workforce and create safe, healthy, and productive workplaces. The
updated CMC competencies were reviewed and validated by subject matter experts identified by the IAEE. For
more information, download the Summary of Changes.

7
Hospitality, Tourism, and Events Competency Model