Job Evaluation and Pay

8/8/2019 Job Evaluation and Pay

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Job Evaluation and PayJob Evaluation and Pay

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IntroductionIntroduction

To enhance efficiency and equity inTo enhance efficiency and equity incompensationcompensation Rank in JobRank in Job characteristics of the jobcharacteristics of the job

Rank in PersonRank in Person characteristics of the personcharacteristics of the person

Assignment of jobs into categories Assignment of jobs into categoriesfacilitates other personnel tasksfacilitates other personnel tasks

Understanding and ultimately describe theUnderstanding and ultimately describe the job content job content

Job descriptions must be maintainedJob descriptions must be maintainedregularlyregularly

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Sources of InformationSources of Information

Old job descriptionOld job description Incumbent employeeIncumbent employee

Questionnaire designed to provide informationQuestionnaire designed to provide informationas to tasks, the amount of time spent, andas to tasks, the amount of time spent, andthe K S As needed to perform satisfactorythe K S As needed to perform satisfactory

Personal interviewsPersonal interviews

Supervisory interviewSupervisory interview

Determine the accuracy of informationDetermine the accuracy of informationprovided by employee & provide ownprovided by employee & provide ownassessment of new jobassessment of new job

Desk Audit Desk Audit work is observedwork is observed3



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Four Techniques of Job AnalysisFour Techniques of Job Analysis

Jobs are evaluated by comparing them withJobs are evaluated by comparing them witheach or by comparing with an independent each or by comparing with an independent standardstandard

Jobs are evaluated as a whole or byJobs are evaluated as a whole or byexamining & comparing compensable factorsexamining & comparing compensable factorssuch as knowledge, working conditions orsuch as knowledge, working conditions orresponsibilitiesresponsibilities

Whole factor job approaches rely on anWhole factor job approaches rely on anentirely qualitative assessment entirely qualitative assessment

Factor based approaches generate numericalFactor based approaches generate numericalscores that represent the relative value of scores that represent the relative value of

jobs jobs 4





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Grade Description or JobGrade Description or Job

ClassificationClassification Jobs are compared with evaluationJobs are compared with evaluation

standards which are written descriptionsstandards which are written descriptions

of job categories that form the basis forof job categories that form the basis forpaypay

Implementation requires the analyst toImplementation requires the analyst tosimply compare job descriptions with thesimply compare job descriptions with the

descriptions of pay grades and to place adescriptions of pay grades and to place a job into the grade that best matches the job into the grade that best matches the job duties and responsibilities job duties and responsibilities

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Factor Based MethodFactor Based Method

Begins with the identification of benchmarkBegins with the identification of benchmark Identify job factors that justify compensationIdentify job factors that justify compensation Determine how much of the pay of eachDetermine how much of the pay of each

benchmark job is attributable to each of thebenchmark job is attributable to each of theselected factorsselected factors

Compare with the benchmark jobs factor byCompare with the benchmark jobs factor byfactorfactor

Compare with market Compare with market Advantages Advantages -- the exercise of judgment the exercise of judgment

DisadvantageDisadvantage complicatedcomplicated

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Factor Point TechniqueFactor Point Technique

Jobs must be broken down intoJobs must be broken down intocompensablecompensable

Select and define compensable factorsSelect and define compensable factors

Weigh factors to determine the relativeWeigh factors to determine the relativeinfluence on the value of a jobinfluence on the value of a job

Identify & define specific level of eachIdentify & define specific level of eachfactor (3 knowledge levels)factor (3 knowledge levels)

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Job PricingJob Pricing Job evaluation methods will produce a rankJob evaluation methods will produce a rank

ordering of jobs from most valued to least ordering of jobs from most valued to least

Information used to set pay levels based onInformation used to set pay levels based on

relative value and ensure internal & external payrelative value and ensure internal & external payequityequity

Survey employers as to similar jobsSurvey employers as to similar jobs

Number of pay grades reflects meaningfulNumber of pay grades reflects meaningfuldifference between levelsdifference between levels

Step increases that can be awarded asStep increases that can be awarded asincentivesincentives

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Job Evaluation: Federal ServiceJob Evaluation: Federal Service

Classification Act of 1923Classification Act of 1923 applied to 10%applied to 10% The Act reinforced the concept of rank in job & set The Act reinforced the concept of rank in job & set

stage for expansionstage for expansion

Classification Act of 1949Classification Act of 1949 Consolidated the occupational series of the 1923Consolidated the occupational series of the 1923

statute into the GS systemstatute into the GS system

Considers: Nature of work, amount of supervision,Considers: Nature of work, amount of supervision,

guidelines available, importance & scope of decisions,guidelines available, importance & scope of decisions,supervisory authority, technical skills, experience andsupervisory authority, technical skills, experience andqualificationsqualifications

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Narrative Job DescriptionsNarrative Job Descriptions

Statement of major duties/responsibilitiesStatement of major duties/responsibilities

Includes kind & degree of supervisionIncludes kind & degree of supervision

Description of the controls over positionDescription of the controls over position

How work is assigned, kind of supervision,How work is assigned, kind of supervision,kind of review givenkind of review given

Statement of special qualificationsStatement of special qualifications K S As, certification, licenseK S As, certification, license

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Factor Evaluation SystemFactor Evaluation System Relies on 9 factorsRelies on 9 factors

KnowledgeKnowledge

Supervisory controlsSupervisory controls

Guidelines availableGuidelines available Complexity of workComplexity of work

Scope & effect of workScope & effect of work

Personal contactsPersonal contacts

Purpose for contactsPurpose for contacts

Physical demands of jobPhysical demands of job

Nature of work environment Nature of work environment

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Job Evaluation & ClassificationJob Evaluation & Classification

IssuesIssues Systems brought order to misleading jobSystems brought order to misleading jobtitles, inequitable pay, uninformedtitles, inequitable pay, uninformedrecruitment & selection processrecruitment & selection process

National Academy of Public AdministrationNational Academy of Public Administrationmaintains that the design & administration of maintains that the design & administration of

job evaluation systems should promote the job evaluation systems should promote theaccomplishment two objectivesaccomplishment two objectives

Support efforts to treat job applicants andSupport efforts to treat job applicants andemployees equitably and impartialemployees equitably and impartial

Designed to promote effective and efficient Designed to promote effective and efficient agency performanceagency performance

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Criticisms of Job EvaluationCriticisms of Job Evaluation

SystemsSystems Use of professional/managerial judgment orUse of professional/managerial judgment ordiscretiondiscretion

Decisions based on factual inaccuracies orDecisions based on factual inaccuracies ormisrepresentationsmisrepresentations

Discretionary nature allows for organizational biasDiscretionary nature allows for organizational bias

OverOver--grading errors traceable to managersgrading errors traceable to managers

High level pressure on analystsHigh level pressure on analysts

G

rade creep refers to unplanned rise in level G

rade creep refers to unplanned rise in level OverOver--grading of levelgrading of level

Inflated job descriptions/manipulated jobInflated job descriptions/manipulated jobevaluationsevaluations

Making job evaluation negotiableMaking job evaluation negotiable14



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Managerial ConcernsManagerial Concerns

Classification standards are complexClassification standards are complex

Central personnel agencies provide littleCentral personnel agencies provide little

leadership & are resistant to changeleadership & are resistant to change Process is burdensome and unintelligibleProcess is burdensome and unintelligible

Supervisors pressure analyst to overSupervisors pressure analyst to over--gradegrade

Rank in position approach is too rigid andRank in position approach is too rigid and

inflexible, neglecting employees impact inflexible, neglecting employees impact Classification plans & position descriptions areClassification plans & position descriptions are

out of dateout of date

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NAPAs ReformsNAPAs Reforms

Authorizing significant delegations of Authorizing significant delegations of authority to line managersauthority to line managers

Broad banding or consolidation of existingBroad banding or consolidation of existinggrades into 3grades into 3--4 grades with wise ranges4 grades with wise ranges

Allowing skills Allowing skills--based pay differentialsbased pay differentials

RankRank--inin--job model could be replaced by job model could be replaced byrankrank--inin--personperson

Shift design of grading systems to agencyShift design of grading systems to agency

Allow more agency level discretion Allow more agency level discretion16



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RankRank--inin--Person SystemPerson System

Restricted services, FBI, CI A, CBIRestricted services, FBI, CI A, CBI

Police departments combine it with jobPolice departments combine it with jobbased modelbased model

Emphasis placed on general skills and theEmphasis placed on general skills and thepotential to continuously developpotential to continuously develop

May be more flexible, adaptable, and fit May be more flexible, adaptable, and fit within centralized structurewithin centralized structure

Favorably reviewed by MSPBFavorably reviewed by MSPB17



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FragmentationFragmentation

A policy option supported by those who A policy option supported by those whobelieve that a single classification systembelieve that a single classification system

simply cannot effectively address HRsimply cannot effectively address HRneeds & human capital strategies under allneeds & human capital strategies under allcircumstancescircumstances

Efforts to deal with problems of Efforts to deal with problems of conventional systems have dealt withconventional systems have dealt withflexibility, responsiveness, understandingflexibility, responsiveness, understanding

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BroadBroad--bandingbanding

Makes it easier for managers to designMakes it easier for managers to designand interrelate positions around workand interrelate positions around work

Facilitates recruitment on basis of Facilitates recruitment on basis of occupations and career planning andoccupations and career planning andmakes moving people less complicatedmakes moving people less complicated

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China Lake DemonstrationChina Lake Demonstration

Project Project OPM evaluations showed it was successful inOPM evaluations showed it was successful in

improving personnel management improving personnel management

Simplified and delegated classification procedures,Simplified and delegated classification procedures,dramatically reduced time neededdramatically reduced time needed

Reduced conflicts between personnel specialists andReduced conflicts between personnel specialists andmanagersmanagers

Unclear which of the reforms at China Lake (newUnclear which of the reforms at China Lake (newperformance appraisal, pay for performance, higherperformance appraisal, pay for performance, higherpay, broadpay, broad--banding) is responsiblebanding) is responsible

Useful way of expanding the authority of lineUseful way of expanding the authority of line

managersmanagers20



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Issues Regarding Pay in theIssues Regarding Pay in the

Public ServicePublic Service Public sector pay is a political outcomePublic sector pay is a political outcome

It is also a collective bargaining issueIt is also a collective bargaining issue

Unions and employees want more, management Unions and employees want more, management wants to give lesswants to give less

Pay has to be competitive to attract and retainPay has to be competitive to attract and retaingood employeesgood employees

Different plans have been createdDifferent plans have been created

Pay rates should be comparable with privatePay rates should be comparable with privatesector for similar jobs in similar marketssector for similar jobs in similar markets

(prevailing rate)(prevailing rate)21



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Prevailing RatesPrevailing Rates

Supply and demandSupply and demand

Prevailing rate surveys are usedPrevailing rate surveys are used

Salary based on average competitive pay

Salary based on average competitive pay Other jobs are placed base on their valueOther jobs are placed base on their value

in relation to the benchmarksin relation to the benchmarks

Allows employers to acquire and retain HR Allows employers to acquire and retain HRwithout paying more than they need towithout paying more than they need to

identify & pay the going market price for aidentify & pay the going market price for aset combination of K S Asset combination of K S As

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Public Sector PayPublic Sector Pay Groups actively seek to have pay decisionsGroups actively seek to have pay decisions

made in their favormade in their favor

Politicians have to decide to fund a programPoliticians have to decide to fund a program

or achieving comparable payor achieving comparable pay Legislators more generous to lower ranksLegislators more generous to lower ranks

More numerous, exert more political pressureMore numerous, exert more political pressure

Pay for non managerial employees set Pay for non managerial employees set through collective bargainingthrough collective bargaining

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Government PayGovernment Pay

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Legislators dont like paying executives moreLegislators dont like paying executives morethan they makethan they make

Slow increases & presidential action hasSlow increases & presidential action hasmaintained a gap in pay for certain jobsmaintained a gap in pay for certain jobs

Salary compression is result of caps on topSalary compression is result of caps on top

salaries and problems with grade creepsalaries and problems with grade creep Net effect is to flatten pay structure, graduallyNet effect is to flatten pay structure, gradually

closing the gap between higher and lower levelsclosing the gap between higher and lower levels

Makes it difficult to recruit and retain highlyMakes it difficult to recruit and retain highly

qualified administrators and technical personnelqualified administrators and technical personnel



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Recent Developments in FederalRecent Developments in Federal

ServiceService Federal pay differed from private sectorFederal pay differed from private sector

based on locationbased on location

Private sector paid more than federal government Private sector paid more than federal government in 90% of the casesin 90% of the cases

Private sector enjoyed competitive payPrivate sector enjoyed competitive payadvantages in over 20% of the casesadvantages in over 20% of the cases

Prior to 1990, the federals government couldPrior to 1990, the federals government couldonly vary its GS pay by locality by offeringonly vary its GS pay by locality by offeringspecial rates which had to be approved byspecial rates which had to be approved by

OPM (applied to 2,500GS

employees)OPM (applied to 2,500GS

employees)25



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Comparability Act of 1990Comparability Act of 1990

Compromise between comprehensiveCompromise between comprehensivereform and actions designed to reachreform and actions designed to reach

comparability and incrementalcomparability and incrementaladjustmentsadjustments

President retained across the board hikesPresident retained across the board hikes

Federal Pay Council was createdFederal Pay Council was created Nine member panelNine member panel

Three neutral expertsThree neutral experts

Six employees organization representativesSix employees organization representatives26



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FEPCA PrinciplesFEPCA Principles

Equal pay for substantially equal workEqual pay for substantially equal work Pay distinctions based onPay distinctions based on

work/performancework/performance

Pay should be comparable with nonPay should be comparable with non--federal rates for the same workfederal rates for the same work

Disparities between federal and nonDisparities between federal and non--

federal employees should be completelyfederal employees should be completelyeliminatedeliminated

FEPCA Provisions on page 151FEPCA Provisions on page 151

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Federal Blue Collar PayFederal Blue Collar Pay

Coordinated Federal Wage SystemCoordinated Federal Wage System Corrected the payment of different wages forCorrected the payment of different wages for

same occupationssame occupations

Provided for common set of policies andProvided for common set of policies andoperating proceduresoperating procedures

Covered 185K employees in 2004Covered 185K employees in 2004

Allows for considerable union influence Allows for considerable union influence

Union and management are represented onUnion and management are represented onlocal wage survey committeelocal wage survey committee

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Union Impact Union Impact

The spread of bargaining improved theThe spread of bargaining improved thepay of workers in occupations such as:pay of workers in occupations such as:police, fire, teachers and nursespolice, fire, teachers and nurses

State & local often moved unilaterally toState & local often moved unilaterally to

upgrade payupgrade pay State & local pay raises have kept up withState & local pay raises have kept up with

inflation during the 60s, kept pace in theinflation during the 60s, kept pace in the70s and forced to concentrate on70s and forced to concentrate on

protecting jobs & fighting proposed cutsprotecting jobs & fighting proposed cuts Two important areas are: comparableTwo important areas are: comparable

worth and pay for performanceworth and pay for performance



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Comparable WorthComparable Worth

Illegal to pay women less than men for theIllegal to pay women less than men for thesame worksame work -- different than work of different than work of comparable valuecomparable value

Advocates argue that public employers Advocates argue that public employersshould implement a system based on equalshould implement a system based on equalpay for work of equal valuepay for work of equal value

Critics argue it would force employers toCritics argue it would force employers tooverpay for skills in ample supply andoverpay for skills in ample supply andunderpay for scarce and essential humanunderpay for scarce and essential humanresourcesresources

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Comparable Worth (cont)Comparable Worth (cont) Washington v GuntherWashington v Gunther court ruled that unequalcourt ruled that unequal

pay for men & women for work of equal valuepay for men & women for work of equal valuewould be a cause for action under CRAwould be a cause for action under CRA It did not endorse the concept It did not endorse the concept

Courts usually allow employers defense that Courts usually allow employers defense that they pay prevailing ratesthey pay prevailing rates Washington was first state to recognized sexWashington was first state to recognized sex

discrimination and conduct a study of genderdiscrimination and conduct a study of genderbased pay disparitiesbased pay disparities

The move was ultimately squashed by the Court The move was ultimately squashed by the Court of Appealsof Appeals Intentional discrimination not establishedIntentional discrimination not established Discriminatory intent not inferred by statisticalDiscriminatory intent not inferred by statistical

evidenceevidence



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Skill Based PaySkill Based Pay

Pay is keyed to one or more of followingPay is keyed to one or more of following Depth of skill, or (science, law, engineering)Depth of skill, or (science, law, engineering)

Breadth of skill which involves rewardingBreadth of skill which involves rewardingemployees for having knowledge and skills inemployees for having knowledge and skills inareas of organizational activity related to theirareas of organizational activity related to their

jobs (more flexible and able to self manage) jobs (more flexible and able to self manage)

Vertical skills or the ability to self manage in Vertical skills or the ability to self manage insuch areas as scheduling work, leading groupsuch areas as scheduling work, leading groupproblem solving meetings, training,problem solving meetings, training,consulting, and coordinating other groupsconsulting, and coordinating other groups

Documents

Job Evaluation and Pay