1. Procedure for Establishing Point Method of Job Evaluation
Select Job Cluster
Identify Compensable Factors
Determine Degrees and Define Each Compensable Factors
Determine Factor Weights
Determine Factor Point Values
Validate Point System
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2. A Point Method Example
Select Job Cluster - Assume we are going to develop point system for the administrative job cluster
Identify Compensable Factors - Assume compensable factors identified are education, job knowledge, contacts, complexity of duties, and initiative
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3. A Point Method Example (Cont.)
Determine Degrees and Define Each Compensable Factors - In administrative job cluster, Education, Job Knowledge, and Initiative have been determined to have five degrees; Contacts has four; and Complexity of Duties has three
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4. A Point Method Example (Cont.)
FACTOR: CONTACTS
Level (Degrees) Points
IV Usual purposes of contacts are to discuss problems and possible
solutions, to secure cooperation or coordination of efforts, and to get
agreement and action; more than ordinary tact and persuasiveness required.
III Usual purposes of contacts are to exchange information and settle
specific problems encountered in course of daily work.
II Contacts may be repetitive but usually are brief with little or no
continuity.
I Contacts normally extend to persons in immediate work unit only. 18
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5. A Point Method Example (Cont.)
FACTOR: COMPLEXITY OF DUTIES
III Performs work where only general methods are available. Independent 85
action and judgment are required regularly to analyze fact, evaluate
situations, draw conclusions, make decision, and take or recommend action.
II Performs duties working from standard procedures or generally 51
understood methods. Some independent action and judgment are required
to decide what to do, determine permissible variations from standard
procedures, review facts in situations, and determine action to be taken,
within limits prescribed.
I Little or no independent action or judgment. Duties are so standardized 17
and simple as to involve little choice as to how to do them.
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6. A Point Method Example (Cont.)
Determine Factor Weights - Assume the committee believes that education is quite important for administrative job cluster and sets the weight for education at 35%. The weights of other four factors were determined by the committee to be:
Job Knowledge—25
Contacts—18
Complexity of Duties—17
Initiative—5
The percent total is 100%
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7. A Point Method Example (Cont.)
Determine Factor Point Values - Committee determines total number of points for the plan. Number may vary, but 500 or 1,000 points may work well. Committee has determined that a 500 point system will work.
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8. Job Evaluation Worksheet (500-Point System)
Degree of Factor
Job Factor
Weight 1 2 3 4 5
Education
35% 35 70
105
140
175
Job Knowledge
25% 25 50 75
100
125
Contacts
18% 18 42 66 90
Complexity of Duties
17% 17 51 85
Initiative 5% 10 15 20
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9. A Point Method Example (Cont.)
Validate Point System - Each committee member should take a random sample of jobs within chosen job cluster and calculate weights for each job selected
Point total for Administrative 2 job is determined to be 239 points
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10. Job Evaluation Worksheet for Administrative 2 Position
Degree of Factor
Job Factor
Weight 1 2 3 4 5
Education
35% 35 70
105
140
175
Job Knowledge
25% 25 50 75
100
125
Contacts
18% 18 42 66 90
Complexity of Duties
17% 17 51 85
Initiative 5% 10 15 20
Total Job Value
239
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11. Illustration of Arithmetic and Geometric Progression
Degree of Factor
Job Factor
Experience Required 1 year years years years
( Arithmetic Progression )
Degree of Factor
Job Factor
Experience Required 1 year years years years
( Geometric Progression )
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12. The Hay Guide Chart-Profile Method
Refined version of the point method
Know-how
Problem Solving
Accountability
Additional compensable elements, such as working conditions
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13. Job Pricing Placing dollar value on worth of job
Pay grades - Grouping of similar jobs to simplify pricing jobs
Wage curve - Fitting of plotted points to create smooth progression between pay grades
Pay ranges - Minimum and maximum pay rate with enough variance between to allow for significant pay difference
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14. Job Pricing (Cont.)
Broadbanding - Collapses many pay grades into few wide bands to improve effectiveness
Single rate system - Pay ranges not appropriate for some workplace conditions such as some assembly lines
Adjusting pay rates - Overpaid and underpaid jobs
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15. Pay Ranges for Pay Grades
Scatter Diagram of Evaluated Jobs Illustrating Wage Curve, Pay Grades, and Pay Ranges
Average Pay per Hour (Current Rates or Market Rates)
$19.80 5
18.50 4
17.20 3
15.90
Wage Curve
Pay Ranges for Pay Grades 2
14.60
14.00 1
13.30
12.90
12.00
100
200
300
400
500
Evaluated Points 1 2 3 4 5
Pay Grades
Summary
Evaluated Points Pay Grade Minimum Midpoint Maximum
$ $ $
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