Job?classification (or?job?grading)?is a simple, widely used?job evaluation?method in which raters categorize jobs into groups; all the jobs in each group are of roughly the same value for pay purposes. We call the groups?classes?if they contain similar jobs, or?grades?if they contain jobs that are similar in difficulty but otherwise different. Thus, in the federal government?s pay grade system, a ?press secretary? and a ?fire chief? might both be graded ?GS-10? (GS stands for ?General Schedule?). On the other hand, in its?job?class system, the state of Florida might classify all ?secretary IIs? in one class, all ?maintenance engineers? in another, and so forth.
job?classification (or?job?grading)
A method for categorizing jobs into groups.
classes
Grouping jobs based on a set of rules for each group or class, such as amount of independent judgment, skill, physical effort, and so forth, required. Classes usually contain similar jobs.
grades
A?job?classification system like the class system, although grades often contain dissimilar jobs, such as secretaries, mechanics, and firefighters. Grade descriptions are written based on compensable factors listed in classification systems.
In practice, there are several ways to categorize jobs. One is to write class or grade descriptions or summaries (similar to?job?descriptions); you then place jobs into classes or grades based on how well they fit these descriptions. Another to write a set of compensable factor-based rules for each class (for instance, how much independent judgment, skill, and physical effort does the class of jobs require?). Then categorize the jobs according to these rules.
The usual procedure is to choose compensable factors and then develop short class or grade descriptions that describe each class (or grade) in terms of the amount or level of the factors in those jobs. For example, the U.S. government?s classification system uses the following compensable factors: (1) difficulty and variety of work, (2) supervision received and exercised, (3) judgment exercised, (4) originality required, (5) nature and purpose of interpersonal work relationships, (6) responsibility, (7) experience, and (8) knowledge required. Based on these compensable factors, raters write a?grade definition?like that in?Figure?11-4. This one shows one grade description (GS-7) for the federal government?s pay grade system. Then the?evaluation?committee reviews all?job?descriptions and slots each?job?into its appropriate grade, by comparing each?job?description to the rules in each grade description. Thus, the federal government system classifies the positions?automotive mechanic,?welder,?electrician, and?machinist?in grade GS-10.
grade definition
Written descriptions of the level of, say, responsibility and knowledge required by jobs in each grade. Similar jobs can then be combined into grades or classes.

FIGURE?11-4?Example of a Grade Definition
Source:??Grade Level Guide for Clerical and Assistance Work? from U.S. Office of Personnel Management, June 1989.
The classification method has several advantages. The main one is that most employers usually end up grouping jobs into classes or grades anyway, regardless of the?evaluation?method they use. They do this to avoid having to price separately dozens or hundreds of jobs. Of course, the?job?classification automatically groups the employer?s jobs into classes. The disadvantages are that it is difficult to write the class or grade descriptions, and considerable judgment is required to apply them. Yet many employers use this method with success.
Job Evaluation?Methods: Point Method
The?point method??s overall aim is to determine the degree to which the jobs you?re evaluating contain selected compensable factors. It involves identifying several compensable factors for the jobs, as well as the degree to which each factor is present in each?job. Assume there are five degrees of the compensable factor ?responsibility? a?job?could contain. Further, assume you assign a different number of points to each degree of each compensable factor. Once the?evaluation?committee determines the degree to which each compensable factor (like??responsibility? and ?effort?) is present in a?job, it can calculate a total point value for the?job?by adding up the corresponding degree points for each factor. The result is a quantitative point rating for each?job. The point method of?job evaluation?is the most popular?job evaluation?method today.50
3 Explain in detail how to establish a market-competitive pay plan.
?Packaged? Point Plans
A number of groups (such as the Hay Group, the National Electrical Manufacturer?s Association, and the National Trade Association) have developed standardized point plans. Many thousands of employers use these systems. They contain ready-made factor and degree definitions and point assessments for a wide range of jobs. Employers can often use them with little or no modification.
Computerized?Job?Evaluations
Using?job evaluation?methods such as the point method can be time-consuming. Accumulating the information about ?how much? of each compensable factor the?job?contains is a tedious process. The?evaluation?committees must debate the level of each compensable factor in each?job. They then write down their consensus judgments and compute each?job?s point values or rankings.
Computer-aided?job evaluation?can streamline the?job evaluation?process. The accompanying screen grab illustrates one. Most of these computerized systems have two main components. There is, first, a structured questionnaire. This contains items such as ?enter total number of employees who report to this position.? Second, all such systems use statistical models. These allow the computer program to evaluate jobs more or less automatically, by assigning points.

Computer-aided?job evaluation?can streamline the?job evaluation?process
Source: Screen capture: [no longer online]?www.hr-software.netcgi/JobEvaluation.cgi. Used by permission.

Job?classification (or?job?grading)?is a simple, widely used?job evaluation?method in which raters categorize jobs into groups; all the jobs in each group are of roughly the same value for pay purposes. We call the groups?classes?if they contain similar jobs, or?grades?if they contain jobs that are similar in difficulty but otherwise different. Thus, in the federal government?s pay grade system, a ?press secretary? and a ?fire chief? might both be graded ?GS-10? (GS stands for ?General Schedule?). On the other hand, in its?job?class system, the state of Florida might classify all ?secretary IIs? in one class, all ?maintenance engineers? in another, and so forth.
job?classification (or?job?grading)
A method for categorizing jobs into groups.
classes
Grouping jobs based on a set of rules for each group or class, such as amount of independent judgment, skill, physical effort, and so forth, required. Classes usually contain similar jobs.
grades
A?job?classification system like the class system, although grades often contain dissimilar jobs, such as secretaries, mechanics, and firefighters. Grade descriptions are written based on compensable factors listed in classification systems.
In practice, there are several ways to categorize jobs. One is to write class or grade descriptions or summaries (similar to?job?descriptions); you then place jobs into classes or grades based on how well they fit these descriptions. Another to write a set of compensable factor-based rules for each class (for instance, how much independent judgment, skill, and physical effort does the class of jobs require?). Then categorize the jobs according to these rules.
The usual procedure is to choose compensable factors and then develop short class or grade descriptions that describe each class (or grade) in terms of the amount or level of the factors in those jobs. For example, the U.S. government?s classification system uses the following compensable factors: (1) difficulty and variety of work, (2) supervision received and exercised, (3) judgment exercised, (4) originality required, (5) nature and purpose of interpersonal work relationships, (6) responsibility, (7) experience, and (8) knowledge required. Based on these compensable factors, raters write a?grade definition?like that in?Figure?11-4. This one shows one grade description (GS-7) for the federal government?s pay grade system. Then the?evaluation?committee reviews all?job?descriptions and slots each?job?into its appropriate grade, by comparing each?job?description to the rules in each grade description. Thus, the federal government system classifies the positions?automotive mechanic,?welder,?electrician, and?machinist?in grade GS-10.
grade definition
Written descriptions of the level of, say, responsibility and knowledge required by jobs in each grade. Similar jobs can then be combined into grades or classes.

FIGURE?11-4?Example of a Grade Definition
Source:??Grade Level Guide for Clerical and Assistance Work? from U.S. Office of Personnel Management, June 1989.
The classification method has several advantages. The main one is that most employers usually end up grouping jobs into classes or grades anyway, regardless of the?evaluation?method they use. They do this to avoid having to price separately dozens or hundreds of jobs. Of course, the?job?classification automatically groups the employer?s jobs into classes. The disadvantages are that it is difficult to write the class or grade descriptions, and considerable judgment is required to apply them. Yet many employers use this method with success.
Job Evaluation?Methods: Point Method
The?point method??s overall aim is to determine the degree to which the jobs you?re evaluating contain selected compensable factors. It involves identifying several compensable factors for the jobs, as well as the degree to which each factor is present in each?job. Assume there are five degrees of the compensable factor ?responsibility? a?job?could contain. Further, assume you assign a different number of points to each degree of each compensable factor. Once the?evaluation?committee determines the degree to which each compensable factor (like??responsibility? and ?effort?) is present in a?job, it can calculate a total point value for the?job?by adding up the corresponding degree points for each factor. The result is a quantitative point rating for each?job. The point method of?job evaluation?is the most popular?job evaluation?method today.50
3 Explain in detail how to establish a market-competitive pay plan.
?Packaged? Point Plans
A number of groups (such as the Hay Group, the National Electrical Manufacturer?s Association, and the National Trade Association) have developed standardized point plans. Many thousands of employers use these systems. They contain ready-made factor and degree definitions and point assessments for a wide range of jobs. Employers can often use them with little or no modification.
Computerized?Job?Evaluations
Using?job evaluation?methods such as the point method can be time-consuming. Accumulating the information about ?how much? of each compensable factor the?job?contains is a tedious process. The?evaluation?committees must debate the level of each compensable factor in each?job. They then write down their consensus judgments and compute each?job?s point values or rankings.
Computer-aided?job evaluation?can streamline the?job evaluation?process. The accompanying screen grab illustrates one. Most of these computerized systems have two main components. There is, first, a structured questionnaire. This contains items such as ?enter total number of employees who report to this position.? Second, all such systems use statistical models. These allow the computer program to evaluate jobs more or less automatically, by assigning points.

Computer-aided?job evaluation?can streamline the?job evaluation?process
Source: Screen capture: [no longer online]?www.hr-software.netcgi/JobEvaluation.cgi. Used by permission.