Posted by In my previous post, I described what job valuation is for and how it affects salaries. I also described 2 methods of valuing work: summative, which focuses on evaluating the total work of a position without a detailed analysis of the difficulty of its performance, and analytical, which involves valuing the difficulty of the tasks included in the duties of a position according to predetermined criteria.
I describe other methods below.
The simplest, but also the most subjective, method of valuing work is ranking. Ranking involves ranking all positions in a company according to the difficulty of the tasks associated with them. In practice, factors are often defined that make a particular task more difficult than another. Comparison of positions is done in pairs. Within these pairs, it is determined which position has more difficult tasks associated with it. Then this position receives 2 points, and the position with easier tasks receives 1 point. After comparing all the posts in pairs and adding up all the points that each post received, the assessed posts can be ranked from the most difficult – the highest number of points – to the easiest.
The method of comparison seems simple and effective, but the more posts there are, the number of pairs compared grows at a dizzying pace. For 5 positions it would be necessary to make 10 comparisons, but already in a company of 50 people such pairs will be 1225. Valuation of work by the method of ranking should not be carried out by one person, but by a team, which through discussion comes to an agreement. However, even team evaluations are characterized by a high degree of subjectivity due to the work experience of team members.
A method recommended especially to large employers by the International Labor Organization is the analytical-point method. It also involves assessing the difficulty of tasks on a given job, but the comparisons are not made in pairs, but are based on listed factors of work handicaps. Job impediments can be such factors as the place of work, the complexity and variety of tasks of the job, or the property liability of the employee.
Within the framework of such factors, the components of each factor are very precisely distinguished and evaluated by assigning points. The sum of these points determines the number of points awarded to each of the main job impediment factors. In addition, each factor is assigned a weight based on the opinions of the employees themselves and experts in the field. The weight of each work impediment factor varies depending on the job and the type of enterprise. The weight of the “complexity of tasks” factor will be different for the position of a foremen and another for a finance director. The total valuation of a job is formed by adding up the multiplied points of each job impediment factor and their weights.
Jobs with similar point totals are combined into job classes, also called grade categories. In this way, tariffs are created, which flexibly combine the difficulty of the work performed with the salary. Job valuation can also be used to determine the responsibilities and tasks of a position. In practice, labor valuation aims to create a consistent system of remuneration, in which the work of each employee would be objectively evaluated as far as possible and, depending on the condition of the company, equally objectively rewarded.