Page 127 - DMGT106_MANAGING_HUMAN_ELEMENTS_AT_WORK

Unit 6: Compensation and Rewards

(b) In the case of new jobs, the method often facilitates fitting them into the existing wage Notes
structure;
(c) The method helps in removing grievances arising out of relative wages; and it improves
labour-management relations and workers morale. In providing a yardstick, by which
workers’ complaints or claims can be judged, the method simplifies discussion of wage
demands and enables differences in wages to be explained and justified;
(d) The method replaces the many accidental factors, occurring in less systematic procedures,
of wage bargaining by more impersonal and objective standards, thus establishing a
clear basis for negotiations;
(e) The method may lead to greater uniformity in wage rates, thus simplifying wage
administration;

(f) The information collected in the process of job description and analysis may also be
used for the improvement of selection, transfer and promotion procedures on the basis
of comparative job requirements; and
(g) Such information also reveals that workers are engaged in jobs requiring less skill and
other qualities than they possess, thereby pointing to the possibility of making more
efficient use of the plants labour.
6.1.5 Limitations of Job Evaluation

There are a number of limitations of job evaluation. They are:
(a) Though it is claimed that job evaluation is an objective and logical method of ranking
jobs and removing unjustified differentials in the existing wage structure, in practice,
it is not so. Rapid changes in technology have given rise to problems of adjustment;
(b) Justifying different rates of pay for different jobs often becomes a difficult task for the
management. When job evaluation is applied for the first time in any organization,
it creates doubts and fears in the minds of employees;
(c) Job evaluation takes a long time to install. It may be costly and therefore, the possibility
of implementing the changes may be restricted by the financial limits within which
the firm has to operate;

(d) Job factors fluctuate because of changes in production. Therefore frequent evaluation
of a job is essential. This requires specialized technical personnel and may be costly;
(e) Higher rates of pay for some jobs and lower rate of pay for some other jobs based
on job evaluation often give rise to human relations problems and lead to grievances
among those holding jobs which are allocated lower wages;
(f) Job evaluation fails to consider a number of variables like supply and demand of a
particular skill, career prospects, social status, etc. which influence the value of a given
job;
(g) Job evaluation is a highly subjective process because it is based on human judgement;
(h) Traditional job evaluation is not well suited to determine the relative worth of
managerial jobs; and
(i) Job evaluation tends to destroy traditional wage differentials which have had
long-standing acceptance.

6.1.6 Methods of Job Evaluation
Determining the relative worth of all jobs in the enterprise is difficult. This is so because
jobs differ with respect to the demands made on the employees as well as the value of the
job to the enterprise. The comparison and evaluation may be made on two bases:

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