Annual Salary ($) 26,000 24,000 21,000 18,000 15,000 12,000 250 Clerk I Job Evaluation Points Market Pay Line 500 Clerk II 750 Clerk III 1,200 Chief Clerk.

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Clerk IJob Evaluation Points

Market Pay Line

500Clerk II

750Clerk III

1,200Chief Clerk

Figure 9-1

Pay Structure for Clerk Jobs (1 of 5)

Clerk I» Employees receive training in basic office support

procedures, the operation of office equipment, and the specific activities of the unit. tasks assigned are simple and repetitive in nature and are performed in accordance with explicit instructions and clearly established guidelines. Sample duties include: Files materials in established alphabetical order and prepared new file folders and affixes labels. Clerk Is must possess a high school diploma or equivalent.

Figure 9-1

Pay Structure for Clerk Jobs (2 of 5)

Clerk II» Employees work under general supervision in support of an

office. They perform routine office support tasks that require a knowledge of standard office procedures and the ability to operate a variety of office equipment. Sample duties include: Prepares simple factual statements or reports involving computations such as totals or subtotals and composes memos requesting or transmitting factual information. Clerk IIs must possess a high school diploma or equivalent and one year work experience performing simple clerical tasks.

Figure 9-1

Pay Structure for Clerk Jobs (3 of 5)

Clerk III» Employees work under general supervision in support of an

office. They perform office support tasks requiring knowledge of general office and departmental procedures and methods and ability to operate a variety of office equipment. Sample duties include: Reconciles discrepancies between unit records and those of other departments and assigns and reviews work performed by Clerks I and II. Clerk IIIs must possess a high school diploma or equivalent, two years work experience performing moderately complex clerical tasks, and completed coursework (five in all) in such related topics as word processing and basic accounting principles.

Figure 9-1

Pay Structure for Clerk Jobs (4 of 5)

Chief Clerk» Employees work under direction in support of an office. They

perform a wide variety of office support tasks that require the use of judgment and initiative. A knowledge of the organization, programs, practices, and procedures of the unit is central to the performance of the duties. Chief clerks must possess a high school diploma or equivalent, four years work experience performing moderately difficult clerical tasks, and an associate’s degree in office management.

Figure 9-1

Pay Structure for Clerk Jobs (5 of 5)

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Messenger (200)Mail Clerk I (220)Clerk I (250)Recep. (300)

Job Evaluation Points

Market Pay Line

Figure 9-2

Pay Grade Definitions

Mail Clerk II (350)Clerk II (500)Sec.I (650)

Mail Clerk III (675)Clerk III (750)Sec. II (1,000)

Mailroom Super (1,175)Chief Clerk (1,200)Exec. Sec. (1,900)

200-300 301-650 651-1,150 1,151-2,000

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Messenger (200)Mail Clerk I (220)Clerk I (250)Recep. (300)

Job Evaluation Points

Figure 9-3

Pay Range Definitions

Mail Clerk II (350)Clerk II (500)Sec.I (650)

Mail Clerk III (675)Clerk III (750)Sec. II (1,000)

Mailroom Super (1,175)Chief Clerk (1,200)Exec. Sec. (1,900)

200-300 301-650 651-1,150 1,151-2,000

Maximum

Midpoint

Minimum

Pay grades are lines, pay ranges are squares!

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BROADBANDING

Job Worth (based on evaluation points)

NO BANDS

Broadbanding is defined as a strategy for salary structures that consolidate a large number of pay grades into a few "broad bands.”

Broadbanding removes some levels of management and creates organizations that are flatter, multi-skilled and more flexible.

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BROADBANDING

Job Worth (based on evaluation points)

BENEFITS OF BROADBANDING –

• Employees are able to broaden their skills and abilities because they fulfill multiple functions

• Managers can make compensation decisions faster and with less paperwork than with a system with “no bands”

BAND A

BAND B

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BROADBANDING

Job Worth (based on evaluation points)

BAND A

PROBLEMS WITH BROADBANDING –

• Maintaining the perception of pay equity can be more difficult because of wide or “broad” bands.• Extra resources are needed to carefully control and monitor the structure

BAND B

BAND C

Pay Compression

In theory, newly hired employees receive near minimum payIn practice, new employees often receive well above minimum pay ratesPay compression: situation where pay spread between newly hired and older employees is small (or reversed)

Example:Avg. salary of professor: $90,000Avg. salary of newly hired professor: $110,000

What causes pay compression?

Compa-ratios

Employee’s pay rate---------------------------Pay range midpoint

Market match policy: Compa-ratio = 1Market-lag policy: Compa-ratio < 1Market-lead: Compa-ratio > 1

Example of Job Evaluation Factors

Factor 1: Scope and Effect. This factor measures the relationship between the nature of the work (purpose, breadth, & depth of assignment) and the effect of work products or services within and outside the organization.

Level 1-1 (75 points):Perform specific procedures which typically comprise a complete segment of an assignment or project of broader scope (e.g., compiling a large body of data for use in a report of departmental activities). The work product or service affects the accuracy, reliability, or acceptability of further processes or services and may affect the efficiency of other employees.

Level 1-2 (150 points): Treat a variety of conventional problems, questions, or situations in conformance with established criteria (e.g., supervising an organizational unit or work group involved in the performance of well-established guidelines.

Level 1-3 (225 points): Establish guidelines or criteria, formulate major programs, assess effectiveness, investigate unusual conditions.

Factor 2: Personal Contacts. This factor includes the face-to-face contacts and telephone and radio dialogue with persons not in the supervisory chain (requirements of initial contact, difficulty of communicating with those contacted, and the contact setting).

Level 2-1 (10 points): Personal contacts are primarily with coworkers in immediate unit but may involve employees in related units.

Level 2-2 (25 points): Personal contacts are with employees of the organization but outside the immediate unit, such as directors of other departments. Contacts are engaged in different functions/kinds of work. May involve contact with public in a moderately structured setting. The exact purpose of the contact may be unclear at first to one or more of the parties (e.g., contact with job applicants).

Level 2-3 (60 points): Personal contacts with individuals or groups from outside in a moderately unstructured setting (e.g., contacts are not routine, purpose and extent of contact is uncertain, and role of each party changes during the contact (e.g., officials of other organizations, attorneys).

Example of Job Evaluation Factors

Factor 3: Guidelines. This factor covers the nature of guidelines and the judgment needed to apply them. Guides used may include technical manuals, policies and procedures, laws and ordinances.

Level 3-1 (25 points): Specific, detailed guidelines covering all important aspects are provided; employee works in strict adherence to guidelines; any deviations must be approved by supervisor.

Level 3-2 (125 points): Employee is provided with a number of guidelines, both written and oral, most of which are directly applicable (e.g., ordinances regulating solid waste disposal). Judgment is used in locating and selecting appropriate guidelines.

Level 3-3 (275 points): Guidelines are available, but many are not applicable to the work or have gaps in specificity (e.g., City ordinances, court decisions, Civil Rights Act). Judgment is used in interpreting, modifying, and adapting guidelines for application in specific situations. Employee analyzes the results and recommends changes in guidelines.

Example of Job Evaluation Factors

Factor 4: Complexity. This factor covers the nature, number, variety, and intricacy of tasks, steps, processes, methods, or activities in the work performed; and the degree to which the employee must vary the work, discern interrelationships and deviations, or develop new techniques, criteria, or information.

Level 4-1 (25 points): Require performance of several related duties involving consideration of choices of appropriate procedures or actions to be taken in a variety of situations. Assignments are usually similar, thus limiting the need to use judgment. Problems are readily solved by well-established procedures.

Level 4-2 (150 points): Require performance of several duties involving different or unrelated processes or methods. There is a substantial amount of problem analysis involved, requiring consideration of many alternative courses of action and the identification of of conditions necessary to discern interrelationships.

Level 4-3 (225 points): Varied duties requiring many different and unrelated processes and methods (e.g., supervision, performance evaluation, coaching). It requires the assessment of unusual circumstances, variations, and incomplete or conflicting data. Employee is required to refine methods to be used.

Example of Job Evaluation Factors

Factor 5: Physical Demands. This factor covers the requirements and physical demands placed on the employee by the work assignment. This includes physical characteristics and abilities (e.g., agility and dexterity) and the physical exertion involved in the work (e.g., climbing, lifting, pushing, balancing, kneeling, crawling, or reaching). The frequency and intensity of physical exertion must also be considered (e.g., prolonged standing).

Level 5-1 (5 points): Work is primarily sedentary, although there may be some walking, bending, or carrying of light objects.

Level 5-2 (20 points): Work requires some physical exertion such as prolonged walking or standing, bending, crouching, or stooping. The employee frequently lifts light objects and occasionally objects weighing 25 to 50 pounds. The use of tools or equipment requiring above average dexterity may be needed (e.g., when training others in their use).

Example of Job Evaluation Factors

Evaluation Form

Factor Weight Pay Grade Your

choice1 2 3

Scope and Effect 30% 75 150 300

Personal Contacts 15% 10 50 150

Guidelines 20% 25 125 200

Complexity 30% 25 150 300

Physical Demands 5% 10 50 NA

100% Total

Job evaluation committee members will enter their selected points after carefully studying the corresponding job description. Then, the total job worth (sum of points across factors) will be computed.

Job Evaluation Exercise$95k

$80k

$65k

$50k

$35k

$20k

$16kPoints

800100 200 300 400 500 600 700

Testing your applied knowledge: Linking Factors and Points to

Corporate Strategy

Factor Pay Grade Pay Grade

1 2 3 1 2 3 4 5

Scope and Effect 75 150 300

Personal Contacts 10 50 150

Guidelines 25 125 300

Complexity 25 150 200

Physical Demands 5 50 NA

Change the following allocation of points to reflect this corporation’s new strategic focus on customer service and quality. Note that you may add two more pay grades if you deem it necessary:

Testing your applied knowledge: Linking Factors and Points to

Corporate Strategy

Factor Pay Grade Pay Grade

1 2 3 1 2 3 4 5Scope and Effect 75 150 300 50 125 200 350 NAPersonal Contacts 10 25 150 25 75 100 150 200Guidelines 25 125 300 25 75 150 200 300Complexity 25 150 200 25 75 100 NA NAPhysical Demands 5 50 NA 5 50 NA NA NA

Answer: it makes sense to increase the point allocation of the “Personal Contacts,” “Scope and Effects,” and perhaps “Guidelines.” More grades may be created within these factors to better differentiate relative employee contributions and career paths.

Scenario: Amanda is an administrative assistant at AZ supermarket. Bill Parker a store manager at AZ supermarkets; he handles all the basic issues regarding the store unit activities, among others. Both employees earn about $30,000 and $35,000, respectively. Amanda thinks her salary is unfair because she performs the same tasks that Bill does. She claims she should be paid more at least what she is paid. Amanda is considering filing a lawsuit against the company under the Equal Pay Act. What should the HR manager do?

Testing your applied knowledge:Employee reclassification

a) Raise Amanda’s salary to the equivalent of Bill’s salary.

b) Raise Amanda’s salary up to more than Bill’s salary.

c) Conduct a job analysis and evaluation of both jobs.

d) Nothing; remain unchanged.

Correct Answer: CExplanation: The manager should conduct a job analysis to identify and define the job content such as the duties and tasks applicable to the job as well as the skill and efforts needed to perform the job. This way, the manager can evaluate whether Amanda’s current job title fails to reflect her duties and, instead, she should be reclassified into a higher-level job such as store manager.

In conducting a job analysis, the company can also eliminate the risk of discrimination (in case of a lawsuit) explaining to the court the basis and justification of the salaries’ difference based not only by difference in job title but differences in job functions and responsibilities.

Testing your applied knowledge:Employee reclassification

The U.S. Department of labor O*NET or occupational network provides an expedient way to find out information about occupational requirements. Please visit the O*NET web site: http://online.onetcenter.org

Identify the O*NET characteristics of two occupations, one primarily male and another primarily female at approximately the same level of occupational complexity. Try to determine whether or not the two occupations have a comparable worth (i.e., similarly important skill, effort, responsibility, working conditions) and therefore should receive similar compensation.

Discussion Question

Discussion Question

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Job Worth (based on job evaluation points)

Grade AGrade B

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Band C

Solution B

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Job Worth (based on job evaluation points)

Grade AGrade B

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An organization is contemplating the “broadbanding” of its job evaluation structure. Two different consultants suggest the following broadbanding solutions. Think about the pros and cons of each solution.

Solution A