JOB EVALUATION AND COMPENSATION MANAGEMENT Job evaluation is the process of systematically determining the relative worth of jobs to create job structure for the organization. The evaluation is based on a combination of the job content, skills required, value to the organization, organizational culture, and the external market. This potential to blend the organizational forces and external market forces is both the strength and a challenge of job evaluation (Milkovich & Newman, 2005). It is essentially a comparative process. Job evaluation is the most effective way of determining internal pay relationships.
Task 3.2 Evaluate the process of job evaluation and other factors determining pay Job evaluation Job evaluation is a formal process by which the relative worth of various jobs in an organisation is determined for pay purposes. A systematic comparison of the worth of one job with that of another eventually results in the creation of a wage or salary hierarchy unique to the organisation. Essentially, job evaluation relates the amount of pay for each job to the extent to which the job contributes to the organisation’s effectiveness. It is not always easy to determine the worth of all jobs in an organisation. Job evaluation involves making judgments that are subject to error on the part of job evaluators.
Responsibilities concerning custody of money, supervision and training of staff, etc are also described in this section Accountabilities: Once job objectives have been made clear responsibilities and duties have been defined, the incumbent is accountable to his or her superior for success or failure in accomplishing these objectives. The section of “accountabilities” not only describes the end results achieved when job duties are performed satisfactorily, but also mentions specific standards for measuring performance. It is therefore particularly useful when preparing for performance appraisal. Job Specifications: As started earlier, the personal qualifications an individual must process in order to perform the duties and responsibilities contained in a job description are compiled in the job specification. Typically the job specification covers two areas: • The skill required to perform the
It is because of this tension that an individual might react in a way that reduces the tension in him. Job Characteristics Theory Hackman and Oldham (1976); Schermerhorn (1984); Hellriegel, Jackson and Slocum (1999) and Dugguh (2008) cited by Ali et al. (2015: 419) proposed a framework to study how particular job characteristics affect job outcomes and job satisfaction. The framework states that there are a number of core job characteristics that impact on job outcomes and they are: • Variety of skills: it includes the degree to which a job requires a variety of different activities in carrying out the work and involves the use of different skills and talents of the
Employee compensation is a sensitive subject and a motivational factor in an individual’s decision to apply for or accept a specific job. Compensation represents the extrinsic and intrinsic rewards employees receive in exchange for work performed as required. These monetary and non-monetary rewards define a company’s total compensation system. Effective compensation system design influences organizational growth by revealing external competitiveness to attract talent, internal equity to retain talent, and individual equity to allow employees to feel that their potential is rewarded; thus, they are encouraged (Lai, 2011). Deliberate and meaningful relationships between employers and human resource managers are necessary to understand and
Transactional leadership brings many problems, such as to determine the reasonable salary, performance measurement, to ensure that people can get a prize. These problems will lead to measure piecework, management, sales commissions and other practical problems. In these cases, the staff and your goals the opposite: they want to do the least amount of
Internal equity occurs when employees compare themselves to others who are charged with different responsibilities but work in the same organization. The equity theory is included in this study because it explains employee motivation on a relative basis by evaluating employees' perception and comparison with their peers. Such comparisons can impact an employee’s satisfaction and motivation, especially if he feels he is not treated fairly.The most notable feature of equity theory is that it proves that beliefs, perceptions, and attitudes influence motivation. The theory that will be discussed next is the expectancy theory, which is also a theory that
According to Robbins (1998)”Job Satisfaction is a general attitude towards one’s job, usually explained by the difference between the amount of reward workers receive and the amount they believe they should receive” Job satisfaction is the collection of feelings and beliefs people have about their jobs. There are numerous theories of Job Satisfaction.1) Content theories-Abraham Maslow hierarchy needs and Herzberg’s two factor theory. Content theory suggests that Job Satisfaction occurs when one’s needs for growth and self actualization are met by the individual job.2) Process theories-Adams(1963 )and Vroom’s Equity theory,1982) these theories attempt to explain Job satisfaction by looking at expectancies and values. 3) Situation theories the
This method tries to find the relative worth of its asset in term of money. In this method, the performance appraisal of subordinates is determined in terms of contribution and cost incurred of the employees. For instance, the cost of training and induction and recruitment and selection. In consequence, the difference between the cost and the contribution of the employees have to be more than the cost incurred on them. The advantages of this method are it can ascertain the cost of labour turnover and it can develop the human resources.
Hypotheses are designed to assess the relationship between financial reward, non-financial reward, total reward and job satisfaction. The following figure 3.2 describes the hypotheses developed for this study. Figure 3.2 The most important variables are taken from the statements under job satisfaction. Namely; hours of work, flexible schedule, encouragement and personal accomplishment. And the most important variables are also taken from the statements under financial reward.