With the new requirements for organisations with 250+ staff to conduct a gender pay audit and publish results from 2018, many organisations are reviewing or implementing their job evaluation schemes.
Employers operate job evaluation schemes for a range of reasons, including the development of clear and orderly pay and grading structures and to help counter equal pay claims, as well to assist with market pricing where required.
A single job evaluation may be implemented to cover the whole workforce or employers may operate different schemes for varying groups of employees. The former approach is often favoured as this is likely to help counter any potential equal pay issues.
Types of job evaluation
There are two main types of job evaluation: analytical schemes, where jobs are broken down into their core components, and non-analytical schemes, where jobs are viewed as a whole. The use of analytical schemes is more popular because of the capacity to help provide a defence against equal pay claims.
These offer greater objectivity in assessment as the jobs are broken down in detail.
Examples of analytical schemes include ‘points rating’ and ‘factor comparison’ approaches.
Points rating – the key elements of each job, which are known as ‘factors’, are identified by the organisation and then broken down into components which may also be weighted. Each factor is assessed separately and points allocated according to the level needed for the job. The more demanding the job, the higher the points value.
Examples of factors commonly assessed include:
- knowledge and skills
- people management responsibility
- communication and networking
- working environment
- impact and influence
- financial responsibility.
Factor comparison is also based on an assessment of factors, though no points are allocated. Use of this method is less widespread than ‘points rating’ systems as the latter approach enables a large number of jobs to be ranked at the time.
These are less objective than analytical schemes, but are often simpler and cheaper to introduce. Methods include job ranking, paired comparisons and job classification.
Job ranking -puts jobs in an organisation in order of their importance, or the level of difficulty involved in performing them or their value to the organisation.
Paired comparisons – compares each job in turn with another in an organisation. This takes longer than job ranking as each job is considered separately.
Job classification, also known as job grading. Before classification, an agreed number of grades are determined, usually between four and eight, based on tasks performed, skills, competencies, experience, initiative and responsibility. Clear distinctions are made between grades. The jobs in the organisation are then allocated to the pre-determined grades.
Developing job evaluation schemes
Whether adopting an analytical or a non-analytical approach, organisations have three main options over scheme design and development:
- a scheme may be developed in-house
- a consultancy’s off-the-shelf package may be purchased
- a consultancy may tailor its package to suit the organisation’s needs.
The system selected will depend on the size of the organisation and the aim of the job evaluation exercise. The Hay Group’s Guide Chart-Profile Method is the most widely used scheme.
Other factors to consider
Job evaluation is a complex and time-consuming task and many organisations draw on the expertise of external organisations to help. The key issues to consider include:
- The process is often as important as the results.
- Job evaluation is an ongoing process.
- An appeals procedure should be established before the evaluation begins.
- Clear, detailed and up-to-date job descriptions have to be drawn up.
- The more complex the scheme, the more detailed the job description needed.
- Accurate records of decisions have to be kept.
- The results have to be checked to see if there are any pay anomalies.
- Effective communications are essential, as employees may have concerns over their future job grading and pay.
Many organisations don’t have the skills in-house to conduct a Gender Pay audit or review or implement job evaluation schemes. The latter can be a big piece of work and organisations should not under estimate the time and cost implications. Given we are half way through 2016 and first set of published results will be April 2018 time is tight to really get your house in order though still possible.
Any company Job evaluation (and market pricing exercises) schemes need to be reviewed regularly to ensure such approaches continue to meet changing business needs. Job evaluation is an assessment of the role, not the person doing it, and should be based on a fair, transparent system that is effectively communicated and understood by employees.
The type of scheme chosen will depend on organisational needs, but any staff making decisions on job roles must remain impartial and may require training in the chosen system.
How can we assist you?
Amelore can provide both job evaluation and gender pay auditing services tailored to your needs. If you would like more information, please get in touch with us.