Smart employers know that keeping quality employees requires providing the right compensation and benefits package. Compensation includes wages, salaries, bonuses and commission structures. Employers shouldn't ignore the benefits portion of employee compensation and benefits, because the benefits sweeten employment contracts with the priorities that most employees need. Show
Attracting Top TalentPeople are always looking to put themselves in the best possible position financially. Those who are worth a specific salary amount often know their value and will seek a position that pays accordingly. Do research on what your competitor's compensation and benefits packages look like. Make sure you offer a similar package to your potential employees so that you attract the best candidates for your company. Hiring the right candidate the first time reduces recruiting costs and helps free up business owners for other tasks. Increased Employee MotivationProperly compensating employees shows you value them as workers and as human beings. When people feel valued, they feel better about coming in to work. Overall company morale increases and people are motivated to come to work and do a good job. Additionally, when employees know there are bonuses or commissions, they are increasingly motivated to deliver grander results. Bonus and commission compensation plans become a focal point for success. Boost Employee LoyaltyWhen employees are being paid well and are happy, they're likely to stay with the company. Proper compensation is one factor why employees remain with employers. Loyalty means that business owners don't need to continue to spend time, money and energy on recruiting new candidates. Employee retention and low-turnover rates are great for employers who cultivate a team that knows what to do. That team is also motivated to be part of the team, and they get the job done well. Increased Productivity and ProfitabilityHappy employees are productive employees. Productivity in relation to compensation starts with employees feeling valued which increases motivation and loyalty. Not only are employees more motivated to do a good job, but also, the longer people are with the company, the more they know and the more efficient they become. All of this leads to increased productivity. Job Satisfaction So People StayCreating the right compensation plan leads to stronger job satisfaction. The right compensation plan includes benefits, along with all the other bonuses available. Employees often boast about holiday bonuses or they keenly watch how the company stock performs because they have stock options. The right compensation program invests employees into the work being done, which gives them a stronger sense of satisfaction when the company succeeds. They know they will be rewarded for their efforts; everyone likes to be appreciated. Job evaluation is the process of analyzing and assessing various jobs systematically to ascertain their relative worth in an organization. Job evaluation is an assessment of the relative worth of various jobs on the basis of a consistent set of job and personal factors, such as qualifications and skills required. The objective of job evaluation is to determine which jobs should get more pay than others. Several methods such as job ranking, job grading, and factor comparison are employed in job evaluation. Research indicates, however, that each method is nearly as accurate and reliable as the other in ranking and pricing different jobs. Job evaluation forms the basis for wage and salary negotiations.--------businessdictionary.com Background of Job Evaluation Job evaluation developed out of civil service classification practices and some early employer job and pay classification systems. Whether formal job evaluation began with the United States Civil Service Commission in 1871 or with Frederick W. Taylor in 1881, it is now over 120 years old and still of great value. The first point system was developed in the 1920s. Employer associations have contributed greatly to the adoption of certain plans. The spread of unionism has influenced the installation of job evaluation in that employers gave more attention to rationalized wage structures as unionism advanced. During World War II, the National War Labor Board encouraged the expansion of job evaluation as a method of reducing wage inequities. As organizations became larger and larger and more bureaucratized the need for a rational system of paying employees became evident. Wage structures became more complex and needed some way to bring order to the chaos perpetuated by supervisors setting pay rates for their employees on their own. Job evaluation became a major part of the answer. The techniques and processes of job evaluation were developed and perfected during this time period of the late 1950s. With the advent of the Civil Rights movement, job evaluation literally got written into the law. The Equal Pay Act of 1963 required jobs to be compared on the basis of skill, effort, and responsibility to determine if they were or were not equal. A 1979 study of job evaluation, as a potential source of and/or a potential solution to sex discrimination in pay, was made by the National Research Council under a contract from the Equal Employment Opportunity Commission. The study suggested that jobs held predominantly by women and minorities could be undervalued. Such discrimination resulted from the use of different plans for different employee groups, from the compensable factors employed, from the weights assigned to factors, and from the stereotypes associated with jobs. Although the preliminary report failed to take a position on job evaluation, the final report concluded that job evaluation holds some potential for solving problems of discrimination. Definitions of Job Evaluation Below are given some important definitions of job analysis: Job Evaluation involves determination of relative worth of each job for the purpose of establishing wage and salary differentials. Relative worth is determined mainly on the basis of Job Description and Job Specification only. Job Evaluation helps to determine wages and salary grades for all jobs. Employees need to be compensated depending on the grades of jobs they perform. Remuneration must be based on the relative worth of each job. Ignoring this basic principle results in inequitable compensation and attendant ill effects on employees’ morale. A perception of inequity is a sure way of De-motivating an employee.
Jobs are evaluated on the basis of content and placed in order of importance. This establishes Job Hierarchies, which becomes the basis for satisfactory wage differentials among various jobs. Jobs are ranked (not jobholders) Facts [+] A commonly used job evaluation method is the paired comparison evaluation system. The paired comparison system compares each job within a company with every other job within the company. A job's resulting score is determined from the comparisons. The jobs are then ranked by score. THE JOB EVALUATION PROCESS Job analysis describes a job. Job evaluation develops a plan for comparing jobs in terms of those things the organization considers important determinants of job worth. This process involves a number of steps that will be briefly stated here and then discussed more fully. a) Job Analysis. The first step is a study of the jobs in the organization. Through job analysis, information on job content is obtained, together with an appreciation of worker requirements for successful performance of the job. This information is recorded in the precise, consistent language of a job description. b) Compensable Factors. The next step is deciding what the organization "is paying for" -- that is, what factor or factors place one job at a higher level in the job hierarchy than another. These compensable factors are the yardsticks used to determine the relative position of jobs. In a sense, choosing compensable factors is the heart of job evaluation. Not only do these factors place jobs in the organization's job hierarchy, but they also serve to inform job incumbents which contributions are rewarded. What are Compensable factors? 1. Experience level- How much work experience is needed to perform a job or the prior experience of the employee, whether he has worked in similar industry previously or some other. 2. Educational qualifications- what are all the educational qualifications that are required for the job. 3. Working Condition- the working condition of the job in which the employee would be working (overall environmental factors such as location, hazards and any extreme factors). 4. Confidential Data- the extent to which the employee is exposed to the confidential data. 5. Consequences of mistakes and errors- consequences of the mistake or error occurrence by the employees, effects of those errors or mistake. 6. Complexity of duties- the difficulty level of the duties and task, whether too much decision making is involved in job or not and judgement skills are required or not. 7. Responsibility- the extent of the responsibility the employee entitled to. 8. Mental and physical demands- the degree of concentration and the environment accordingly and level and frequency of physical effort. c) Developing the Method. The third step in job evaluation is to select a method of appraising the organization's jobs according to the factor(s) chosen. The method should permit consistent placement of the organization's jobs containing more of the factors higher in the job hierarchy, than those jobs lower in the hierarchy. d) Job Structure. The fourth step is comparing jobs to develop a job structure. This involves choosing and assigning decision makers, job category, level, and setting up the job hierarchy. e) Wage Structure. The final step is pricing the job structure to arrive at a wage structure. It is also known as a salary structure, a system that determines how much an employee is to be paid as a salary or wage, based on one or more compensable factors such as the employee's experience level, rank or level within the organization, the length of time that the employee has stayed in organisation (total service), complexity of duties and the difficulty of the specific work. performed. Features of Job Evaluation The primary objective of job evaluation is to find out the value of work, but this is a value which varies from time to time and from place to place under the influence of certain economic pressure, not least of which is the worth of money itself. The main features of job evaluations are:
The objectives of job evaluation
Advantages of Job evaluation Job evaluation is a process of determining the relative worth of a job. It is a process which is helpful even for framing compensation plans by the personnel manager. Job evaluation as a process is advantageous to a company in many ways:
Limitations:
What activity is performed so that each job can be paid fairly and in accordance with the organization's pay structure?Job evaluation is defined as the process of determining the relative worth of jobs to determine pay structure. Job evaluation can help us determine if pay is equitable and fair among our employees. There are several ways to perform a job evaluation.
What tool helps an organization match the appropriate people with appropriate jobs for them?Match positions with employee capabilities
Human capital management can help organizations match employees with positions where they can use their skills and talents. This is because the system has processes that can identify the individual strengths and competencies of employees.
What is an analysis of work called?Job analysis (also known as work analysis) is a family of procedures to identify the content of a job in terms of the activities it involves in addition to the attributes or requirements necessary to perform those activities.
What term describes the process that organizations use to determine how well an employee is doing at his or her job quizlet?Performance Appraisal - the process through which an organization gets information on how well an employee is doing his or her job.
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