JOB ANALYSIS, JOB EVALUATION, WAGES & SALARY ADMINISTRATION

By:

Sibananda S. M. Tripathy

DEFINITIONS:

Wage: The payment of labour or services to a worker, especially the remuneration on an hourly, daily or weekly basis or by the piece rate. Salary: Fixed compensation for services, paid to a person on a regular basis.

Basic Compensation: Payments in the form of wages & salaries. Fixed & non-incentives payments on the basis of time spent on the job.
Supplementary Compensation: Incentives & variable payments, based on an individual`s output or a group as a 2 whole.

JOB ANALYSIS

The process of determining by observation & study the tasks, that comprise the job, the methods & equipments used,& the skills & attitudes required for the successful performance on the job. Job- It`s a group of positions involving same duties, responsibility, knowledge & skills. Each job has a definite title & is different from others. Position- It implies a collection of tasks, & duties regularly assigned to one person. Occupation- It implies a group of jobs that are similar as to the type of works & contain similar characteristics.
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Duty- Related sequence of tasks.

Task- A distinct work activity with an identifiable beginning & end.

Job Family- Jobs of similar nature. Job Classification- Grouping of jobs into certain categories on some specified basis. Job Evaluation- Determining the worth of a job at an 4 organisation by comparing it with other jobs within the organisation & with the job market.

OBJECTIVES OF JA

Job Re-design- A job may be analysed to simplify the process & methods involved in it. Such simplifications help to improve productivity. Work Standards- J.A is also done in order to establish job & time standards. Miscellaneous- J.A reports help to support H.R activities like recruitment, selection, training etc.

USES OF J.A

Organisational Design: Authority, Responsibility & Accountability Human Resources Planning: Future job & skill requirements

Recruitment: Matching job requirements with skills

Selection: Selecting the human traits needed

Placement & Orientation: Right skills at right job

Training & Development: Updating skills
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Performance Appraisal: Standards of performance Career Planning: Future prospective movements

Job Design: Engineering design, Man-Machine system, Methods improvement

Job Evaluation: Job classification, Salary structure Labour Relations: Deviation from standards Employee Counseling: Vocational guidance & rehabiliation Health & Safety
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Process of J.A
Organisational Analysis Organising the J.A Program Deciding the Uses of J.A information Selecting the representative jobs to be analysed Understanding job design Collecting data Developing a job description Preparing a job specification

Techniques of J.A
Job performance Personal Observation Interviews & Questionnaires Critical Incidents Log records

Collection of background information: -

Deciding the uses of Job Analysis Information: -

Selecting the representative jobs: -

1.Org Charts
2.Class Specification 3.Workflow Charts

1.Procurement
2.Development 3.Compensation 4.Integration 5.Maintainance

1.Number of jobs to
be analysed 2.Priorities of the different jobs

Job Description Collection of job information Job Specification

Technology of data collection: 1.Direct Observation 2.Interviews 3.Questionnaires 4.Past records 5.Critical Incidents

(The Process Of Job Analysis)

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J.A Form:- p1 Job Title_ _ _ _ _ _ _ _ _ _ _ _ _ _ Date _ _ _ _ _ _ _ _ _ _ _ _ Code no _ _ _ _ _ _ _ _ _ _ _ _ _ _ Location _ _ _ _ _ _ _ _ _ _ Deptt. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Analyst_ _ _ _ _ _ _ _ _ _ _ Reasons for job _ _ _ _ _ _ _ _ _ _ Supervised by _ _ _ _ _ _ _ Relation to other jobs: Promotion from _ _ _ _ _ _ _ _ _ _ Promotion to_ _ _ _ _ _ _ _ _ _ _ _ Job Summery: Works performed _ _ _ _ _ _ _ _ _ _ _ _ _ _ Major duties _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _

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J.A Form:- p2
Skill requirements :Edu (grade/years): Training : Work Exp : Supervision
Job knowledge

:
:

Responsibility

(a)Type of Exp. (b)Length of Exp............... (a)Positions Supervised........... (b)Extent.. (a)General........... (b)Technical. (c)Special.. (a)Prod. & Material.... (b)Equip & Machinery..... (c)Work of others.......... (d)Safety of others.

Physical Demands: Physical Efforts : Surroundings : Hazards involved : Visual efforts : Resourcefulness :

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JOB EVALUATION: DEFINITION

It` the process of analysis & assessment of jobs to ascertain their relative worth using the assessment as the basis for a balanced wage structure.

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OBJECTIVES OF JOB EVALUATION:

To determine equitable wage differentials between different jobs in an organisation. To eliminate inequalities. To develop a consistent wage policy. To establish a rational basis for incentives & bonuses scheme. To provide framework for periodic review & revision of wage rates. To provide a basis for wage negotiations with unions. To minimise wage discriminations on the basis of age, sex, caste, religion etc. To enable management to gauge & control the payroll costs.

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PROCESS OF JOB EVALUATION:

Gaining acceptance- The cooperation & support of top management, employees & trade unions should be obtained through communication (conferences, letter, notices etc.). Constituting the evaluation committee- Experienced & respected representatives from management, workers & outside experts should be constituted. Selecting the jobs to be evaluated- Due to time constraints & monetary issues, some key representative jobs are selected from each dept. these should be representative of the types of works performed.
Describing the jobs- Indicates the duties & responsibilities 15 involved.

Selecting the evaluation method- Most appropriate & if possible more than one method is used to increase accuracy level. Weighing the job factors- Skills(mental & manual), Experience, Efforts, Initiatives, Working conditions, Responsibilities, Supervision required.(weights are assigned to the factors & the total weights indicate the job`s relative value).
Assigning monetary value- The sequence of jobs in terms of their relative worth is related to a money scale.

Periodic review- A periodic review & revision of job descriptions will help to assuage the feeling of employees who believe that their work was not properly evaluated. 16

METHODS FOR JOB EVALUATION:

1.

1.

Non-Quantitative: Ranking/Job Comparison method Grading/Job Classification Method Quantitative: Factors Comparison Point Rating

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RANKING METHOD:

Each job as a whole is compared with other jobs. After comparison, all jobs are arranged from highest to lowest in order to their importance as judged by duties, responsibilities & demands on the job holder.

3 different techniques are useda. Job description:

A written JD is prepared for each job. JD are studied & analysed. Differences are noted. Each job is assigned with a rank depending upon relative significance. Raters may independently rank each job. The average of ratings is calculated to determine rank.

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b. Pair Comparison:

Each job is paired with every other job in a series. Difficult job in each pair is identified. Rank is given on the basis of number of times a job is rated difficult.

c. Ranking along a number line:

Ranks obtained through J.D & paired comparison are spread along a number line. Each job is then placed along the line on the basis of it`s closeness to the highest ranked job.
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GRADING METHOD:
Job classes or grades are established. Grade is a group of different jobs of similar type(skills & knowledge req.) Each job grade is defined in the form of written descriptions. Each job is then classified into different grades depending on how well it`s characteristics match the grade definitions. J.D are carefully analysed. By this, a series of job grades is developed & a different wage rate is fixed for each job grade.

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Grade

Description

Un-Skilled

Jobs involve manual work, little mental ability, no formal education.

Clerical in nature, little physical effort as desk work, H.sc certification is essential.

Skilled

Supervisory Require ability to apply established procedures & to guide others. Graduation is essential. Executive Involve decision making & administration work. Professional qualification is necessary.

Involves policy making & control. Considerable work experience at policy level is required. Dis-advantages: Difficult to write accurate & precise description of grades. 21 Tasks may overlap more than one grade. Rigid system & personal judgement involved.

Policy

FACTOR COMPARISON METHOD:

Few key jobs are selected & compared in terms of common factors.

Procedure: Select & define the factors- Factors common to all the jobs are selected & defined clearly. Select key jobs-The standard against which others can be compared. Rank the key jobs by factor. Decide the rates for key jobs. Apportion the wage rates- Wage rates is allocated among the identified & ranked factors. Evaluate remaining jobs. 22

Key job Tool maker Welder Machinist Painter Labourer

Wage rate Skill Physical Mental Responsibilities WC 80 75 70 65 50 25(1) 20(3) 22(2) 13(4) 10(5) 5(5) 15(2) 7(4) 12(3) 19(1) 23(1) 14(3) 17(2) 10(4) 5(5) 24(1) 11(4) 20(2) 12(3) 4(5) 3(5) 15(2) 4(4) 18(1) 12(3)

Car Painter :Skills (Tool maker) + Physical (Machinist) + Mental (Welder) + Responsibility (Painter) + WC (Painter) = 25 + 7 + 14 + 12 + 18 = 76/day
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POINT METHOD:
Most widely used method for job evaluation. Jobs are divide into component factors. Points & weights are assigned to each factor depending on the degree of importance in a particular job. Total points indicate the worth of the job. Procedure:1.. Determine the job to be evaluated (Representative jobs) 2.. Select factors- (Common factors, measurable, significance etc) & divide into factors.
Factors Sub-Factors

Skills Efforts Responsibility

Edu., Exp., Training, Judgmental ability Physical & Mental Quality output, Raw materials, Machinery, Safety of others Work env., Accidental hazards, Discomfort level

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WC

3.. Define Factors- Factors & sub factors are defined clearly. F-Skill, S.FEducation 4.. Determine the degrees- Different degrees of each factor are decided. Same number of degree should be used for each factor. E.g. Education.
Degree Definition

1 2 3 4

Able to do ordinary counting & understand verbal comm. Able to read & write- VIII th pass. Able to carry mathematical calculations- Matriculation pass. Able to compare written material & to do advanced calculations- Graduation.

5.. Determine relative values to job factors.

Factors Max. Points

Skill
Effort Responsibility Work Condition

400
175 300 125
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6.. Factor points are allocated among sub-factorsSkill = Edu + Exp + Training + Judgement 400 = 75 + 125 + 100 + 100 7.. Assign point value to the degreesPoint values for different degrees of a factor may be divided on the basis of arithmetic progression. e.g. Sub factor education (75)
Point Values for Degree 1 10 2 15 3 20 4 30

8.. Find point value of the jobThe various points assigned to different factors in a job are added up to find out the total points which indicate the 26 relative worth of the job.

9.. Assign Money valueOnce the worth of a job in terms of points is known, these are connected to money value keeping in view the prevailing wage rates. A standard unit of money is assigned.
Point Range 101-200 Daily Wage Rate Rs 15 25 Job Grade 1

201-300
301-400 401-500 -- -- -- -- --901-1000

Rs 25 35
Rs 35 45 Rs 45 60 -- -- --- ---- -Rs 140 - 200

2
3 4 -- --- -- ---- -9
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WAGES & SALARY ADMINISTRATION:

Wage & Salary administration is the study of employee compensation in the organisation.

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OBJECTIVES:
To establish a fair & equitable remuneration. To attract competeny personnel. To retain present employees. To improve productivity. To control costs. To establish job sequences & line of promotion wherever applicable. To improve Union-Management relationships. To improve the public image of empoyees.

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ESSENTIALS FOR A SOUND WAGE SYSTEM:

Keeping in view the interest of all. (employer, employees, customers & community). Must be sufficiently flexible to the changes in the environment. Should be reviewed & revised periodically. Internal equity & external competitiveness. Built in incentives & links with productivity. Maintain real wages. (At least a part of the increase in cost & living should be neutralised so as to protect the real wages. DA is used in India)

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FACTORS AFFECTING WAGES:

Demand for & Supply of labour. Ability to pay. Labour unions. Cost of living & prevailing wage rates. Job requirements. Productivity. State regulations.

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FACTORS AFFECTING INDIVIDUAL WAGE DIFFERENCES:

Age & Potentials. Education & Experiences. Promotional possibilities. Job hazards. Stability in employment. Product demand. Industry`s role in the economy.

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METHODS:

Time Wage System:- Wages paid on the basis of time spent on the job, irrespective of the works done. Units may be an hour, a day, a week or a month. Piece-Wage System:- Remuneration is based on the amount of work done. Unit of work done is considered as one piece & a specific rate of wage per piece is paid. Workman is paid in direct proportion to his output.
Balanced or Debt Method:- It`s the combination of both time & piece wage systems. Worker is guaranteed a time rate with an alternative piece rate. If wages calculated at piece rate exceeds the time rate, worker gets credit. On the other hand, if time rate exceeds piece rate, the worker is paid time wage & the deficit is carried forward as debt to be 33 reconserved in future.

TIME-WAGE SYSTEM:

Advantages:

Easy to understand & implement. No suffering from temporary efficiency loss. Quality work as no pressure. Union prefers as no differentiation between workers. Wages can be calculated easily & in advance. No distinction between efficient & inefficient workers. Low productivity & strict supervision required. No competitiveness. More payment for less work. No basis for finding merits & promotions are on seniority basis. In case of frequent work delays. Where output can`t be measured. Quality is important. Supervision is very good. Machinery & materials are sophisticated & costly. Performance standards can`t be established.

Dis-advantages:

Suitability Conditions:

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PIECE WAGE SYSTEM:

Advantages:

Direct relationship between effort & reward. Incentives increases productivity & hard work. Efficient workers get good opportunities. System is fair to all. Higher output, hence low cost per unit. Cost per unit can easily be calculated. Worker earnings are not suitable. Work speed may affect worker health. Rigid quality control is necessary. Creates jealousy between employees. Methods may lead to industrial disputes as the rate fixation may create controversy. Where works done can be calculated. Flow of work is regular(repetitive jobs). Methods of production are standardised.

Dis-advantages

Suitability Conditions: 35

BALANCED/DEBT METHOD

Advantages: Guaranteed Time-Wage, so worker feels secured. Growth opportunities because of Piece Rate. Scientific rules for Wage calculation.
It`s the present day practice among many industries & is considered as the best practice of Wages & Salary administration.

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SUPPLEMENTARY COMPENSATION:
DA(Dearness Allowance)- It`s given to protect the real wages during inflations. It`s also known as living wages. Other Allowances CCA(City Compensatory Allowance) Bank Allowance Educational Allowance HRA(House Rent Allowance) Conveyance Allowance/ Car Allowance Medical Allowance Tiffin Allowance Bonus- Sharing by workers in the prosperity of the organisation/ unit.

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