Compensation Management

Job Evaluation flows from JOB ANALYSIS Process & uses JOB DESCRIPTION as its base. Job Description is examined by comparing:

Relative importance of the job Relative skills needed to perform the job Difficulty of one job compared to other jobs

Internal job worth through JOB EVALUATION MARKET PRICING:

Pay set by other employers is an accurate reflection of a jobs worth Jobs are same in another organization Economic condition not considered(impact) Employer size not considered

Ranking Method

Places Jobs in order ranging, Lowest to highest value Entire job considered More Than individual components. More useful for small Organization Large number of job increase subjectivity

Classification method
Gather information from J.D. & J.S. Separate jobs into types(sales,operations, accounts,clerical). List Out Common Feature to all. Place in appropriate Classification.

Point Method

Most widely used. Sophisticated. Focus on component. Weight age in logical. More Objectivity. Compensation is Fair.

FACTOR COMPARISON
Bench mask Jobs are Categorized according to levels of Responsibility, Knowledge, Skills, Working Conditions Etc. Comparisons of Direct indirect jobs in organization is made. Market rate of pay ins assigned to the particular job

HAY PLAN-used to exempt employees

Focus factors, key issues Problem solving Accountability Know how(practical application)

ADVANTAGES
Tells real worth of the job Factors values easily converted to monetary values Most widely used

DISADVANTAGES
Cant be used as tailor made Need to consult specialist Reference to comparison method and manuals is essential Time consuming Requires regular review

Wages and salary survey

Information available through national survey,bureau of labour statistics,national chambers of industries Fresh and specific surveys are also undertaken Listing of compatible organization and job responsibility is important

ISSUES TO BE ADDRESSED

Is the survey a realistic sample of employers, or is it dominated by a few large employers? Is the data provided by other personnel specialists, not individual operating managers? How old is the information? How sound and experienced is the organization that prepared the survey?

SAMPLE FACTOR COMPARISON CHART,DANBO MANUFACTURING CORPORATION

POINT METHOD CHARTS

PAY SCATTERGRAM

EXAMPLE OF PRICED LABOUR GRADE