Comp&ben - Ch8

Front 1

Advantages of Point Method

Back 1

High degree of precision in measuring jobs

Can have a high degree of consistency

Orders jobs

Provides a relative value of each job

Jobs can be clustered into pay grades easier than other approaches

Large body of knowledge about point method

Front 2

5 main steps of developing a job evaluation system using the point method

Back 2

1. Identify key job characteristics (compensable factors) that differentiate the value of various jobs

2. Develop a measuring scale for each factor (scaling factors) so that the extent to which each factor is present in a job can be quantified

3. Weight each factor according to importance to the firm. This produces a system that can be used to provide a point total for each factor for each job

4. Apply the job evaluation system to every job included under the JE system.

5. Test the resulting job hierarchy for reliability, validity, and market fit, and make any necessary revisions to the JE system

Front 3

Define compensable factors

Back 3

Characteristics of jobs that are valued by the organization and differentiate jobs from one another

Front 4

Four main categories of compensable factors

Back 4

Skill

Effort

Responsibility

Working Conditions

Front 5

How many factors should be used?

Back 5

Depends on the broadness of groups of jobs

More complexity = more compensable factors

Generally between 8-12

Front 6

What does it mean to scale factors?

Back 6

set degrees (or levels) to each factor

The degrees represent gradations in the extent to which a certain factor is present in a particular job being rated

Front 7

How do you weight the compensable factors?

Back 7

Weight each compensable factor dividing total points between factors, then divide points between the degrees (either identical or varied)

Front 8

How are factor weights derived?

Back 8

statistical analysis

expert judgement

Front 9

How does one apply the job evaluation system?

Back 9

Make a chart outlining the hierarchy of jobs

Front 10

How do you test the job evaluation system?

Back 10

Test for reliability to determine validity

Once reliability is achieved, test for market fit through benchmarking

Front 11

How do you test reliability?

Back 11

Use different evaluators

Front 12

Define validity

Back 12

The extent to which a measuring instrument actually measures what we intend it to

Front 13

Define reliability

Back 13

The extent to which a measure instrument consistently produces the same measurement result when measuring the same thing

Front 14

4 Main Pitfalls of the Point Method of Job Evaluation

Back 14

1. Inconsistent Construct Formation

2. Factor Overlaps

3. Hierarchical Grounding

4. Gender Bias

Front 15

When may factors fail to be well-defined and separate?

Back 15

1. The factor is ambiguous

2. The degree may not be consistent with the factor definition

3. The definitions of the degree or level may not all be degrees of the same construct

Front 16

What does hierarchal grounding mean?

Back 16

The factors confuse the outcome with the process. Example: Responsibility for action explaining reporting hierarchy does not explain the degrees

Front 17

What are the six ways that gender bias occurs when creating job evaluations with the point system?

Back 17

1. Separate job evaluation systems for different job families

2. A factor is valued when it is found in "male jobs" but not in "female jobs"

3. Job content is confused with stereotypes

4. Factors found in female jobs are ignored

5. There is an insufficient range of degree statements

6. The job descriptions are biased

Front 18

Other issues with job evaluation

Back 18

Evaluators bias

Adversarial process between mgmt and employees

Front 19

Define base pay structure

Back 19

The structure of pay grades and pay ranges, along with the criteria for movement within pay ranges, that applies to base pay

Front 20

Define pay grade

Back 20

A grouping of jobs of similar value to the organization, typically grouped by point totals

Front 21

Define pay range

Back 21

The minimum and maximum pay rates (in dollars) for jobs in a particular pay grade

Front 22

5 reasons for clustering jobs into pay grades

Back 22

1. Use of grades recognizes that job evaluation is subjective process

2. Pay grades make it easier to justify and explain pay rates to employees

3. Pay grades simplify the administration of the pay system by eliminating need for separate rates for every job

4. Having jobs clustered within pay grades makes it easier for employees to move across jobs in the same pay grade

5. Pay grades create more stability for the pay system

Front 23

Describe the ways to establish pay grade size?

Back 23

Equal interval approach

Equal increase approach

Equal percentage approach

Broadbanding

Front 24

Define equal interval approach

Back 24

Method to establish pay grade widths, in which the point spreads are equal for all pay grades

Front 25

Define equal increase approach

Back 25

Method to establish pay grade sizes, in which each pay grade increases in width by a constant number of points from the preceding pay grade

Front 26

Define equal percentage approach

Back 26

Method to establish pay grade sizes, in which each pay grade increase in width by an equal percentage from the preceding pay grade

Front 27

Define broadbanding

Back 27

The practice of reducing the number of pay grades by creating large or "fat" grades, sometimes known as "bands"

Front 28

Four areas required to determine pay ranges

Back 28

Establishing range midpoints

Establishing range spreads

Overlaps between pay ranges

Gaps Between pay ranges

Front 29

Define intergrade differentials

Back 29

The difference between the range midpoints of adjacent pay grades in a pay structure, expressed in dollars

Front 30

Define intergrade differential percentage

Back 30

Calculated by dividing the intergrade differential (expressed in dollars) of each pay grade by the midpoint (in dollars) of the previous pay grade

Front 31

Define range spread

Back 31

The difference between the maximum and the minimum pay level, in dollars, for a given pay range

Front 32

Define range spread percentage

Back 32

A percentage calculated by dividing the range spread for a given pay range by the minimum for that pay range

Front 33

Define JND

Back 33

The amount of pay increase necessary to be considered significant by employees receiving the increase

Front 34

Define market line

Back 34

A regression line that relates job evaluation points to market pay (in dollars) for the benchmark jobs

Front 35

Define pay policy line

Back 35

The intended pay policy for the organization, generated by adjusting the market line for the intended pay level strategy of the organization

Front 36

Define correlation coefficient

Back 36

A statistic that measures the extent to which plots of two variables on a graph fall in a straight line