Job evaluation is the systematic process for assessing the relative worth of jobs within an organization. A comprehensive analysis of each position’s tasks, responsibilities, knowledge, and skill requirements is used to assess the value to the employer of the job’s content and provide an internal ranking of the jobs.
It's important to remember that job evaluation is a measurement of the internal relativity of the position and not the incumbent in the position. This analysis can also contribute to effective job design by establishing the organizational context and value of the job, and to hiring and promotion processes by providing job analysis on skill and competencies required to successfully meet job requirements.
While establishing a job evaluation policy and procedure is not a legal requirement, job evaluation is an effective tool organizations use in meeting requirements of pay equity legislation.
Furthermore, provincial human rights codes require employers to treat employees equitably and fairly, without discrimination. A comprehensive job evaluation policy and process can serve to both ensure, and demonstrate, objective and fair decision-making regarding compensation structures, staffing and promotion.
As good practice, organizations can choose to set up a job evaluation committee to support the process.
The job evaluation policy should outline:
- The purpose of the policy
- The objectives of the policy
- Roles and responsibilities for implementing the policy
- A step-by-step list of procedures for the evaluation process
- An appeal process for employees to follow
Sample job evaluation policy
Note: This sample policy has been provided by an anonymous organization.
The organization will ensure the fair and equitable assessment and determination of job worth for the purposes of compensation through a comprehensive job evaluation system. The job evaluation process establishes the grade level for a particular job. The end result of the job evaluating process is a ranking of the jobs in the organization in which the more complex, responsible and skilled jobs are grouped at the higher end of the hierarchy, while the less complex fall at the lower end of the organization’s hierarchy.
Job evaluation is concerned with the job requirements as reflected in a comprehensive job description. Job evaluation is not concerned with the qualifications the employee brings to the job or the salary paid to that individual.
The objectives of job evaluation at the organization are as follows:
- To ensure the fair and equitable compensation of employees in relation to their duties.
- To ensure equity in pay for jobs of similar skill, effort, responsibility and working conditions by using a system that consistently and accurately assesses differences in relative value among jobs and
- To establish a framework of procedures to determine the grade levels and the consequent salary range for new jobs or jobs which have evolved and changed.
The organization uses the job evaluation system developed by The Hay Group, called The Hay Method or the Hay Plan. This system of job evaluation has been approved by the Canadian Human Rights Commission as gender neutral and is a system to assess the value of jobs in a consistent and objective way using a set of factors to measure skill, effort, responsibility and working conditions. Guide charts provided by The Hay Plan define evaluation factors, levels within each factor and the number of points that are to be assigned.
The factors used to evaluate the jobs are:
- Know How
- Working Conditions
Job evaluation committee: The job evaluation committee is comprised of six (6) volunteer members at the director level trained in the Hay Method of job evaluation. This committee is responsible for reviewing jobs up to the level of director. The job evaluation committee has at least one member from each division and is chaired by the Director, Human Resources. A quorum of the job evaluation committee is five (5) members.
A separate committee is responsible for reviewing jobs at the level of director and is comprised of individuals at the level of senior management. The Director, Human Resources, assists this committee.
- The most senior executive: The most senior executive reviews jobs at the senior management level and has the authority to establish or alter the grade level for any position.
Supervisor and employee: Revising a job description for an existing position is the responsibility of both the supervisor and the employee who is doing the work. The description must specify the duties, responsibilities and other characteristics of the work to be performed.The final job description must be signed by the employee, the supervisor and the appropriate senior manager to indicate agreement with its content.
The preparation of job descriptions for vacant positions is the responsibility of the supervisor. Advice and assistance is available from the Human Resources department. The Human Resources department is responsible for the initial job evaluation process and for the scheduling of the appropriate committee to review the job description and the initial job evaluation.
- Senior management: In cases where a department or a significant part of a division is being restructured there is a potential impact on the whole of the organization. Senior management will therefore consult on the proposed restructuring prior to the meeting of the responsible job evaluation committee.
- All new positions should be evaluated before they are staffed.
- In order to ensure that job evaluations are kept current, existing job descriptions will be reviewed every three years.
- If an existing job changes significantly, the job description should be revised, signed and forwarded to the Human Resources department for review. A representative of the Human Resources department does an initial job evaluation to determine whether the changes are significant enough to result in a change of the job’s grade level. If this initial evaluation shows that the position will likely change grades, the position is sent to the appropriate job evaluation committee for review.
- When the Human Resources department has performed an initial evaluation of the job description, the recommendation is then presented to the appropriate job evaluation committee. It's the responsibility of the job evaluation committee to approve or alter the proposed job evaluation and to assign the job a grade level.
- The Director, Human Resources forwards the job evaluation results to the position supervisor with a copy for the employee. The supervisor gives the job evaluation results to the employee.
- The employee has ten (10) working days from the date they receive the results of the job evaluation committee to decide whether to request a review of the decision. The immediate supervisor and the next level manager must support requests that a job evaluation committee reconsider its decision about a job evaluation. The most senior executive has the discretion to intervene as they deem appropriate, and their decision is final.
- The Human Resources department will normally provide an interim evaluation for a term position. If a term contract lasts or is expected to last beyond six months, the appropriate job evaluation committee will be asked to review and evaluate the term job description. For this purpose, a quorum is considered three (3) members of the appropriate job evaluation committee.
- The job evaluation process will be periodically audited to ensure that it's being applied consistently and fairly and that the duties described in job descriptions correspond to the work performed.
- The Human Resources department will keep a current position relationship chart available for interested employees.
Identify the person or position employees can approach if they have questions.
Reference any other policies, documents, or legislation that support the interpretation of this policy.
Indicate the date the policy came into effect and the date of any revisions.
Indicate the date the policy is due to be reviewed. This will vary based upon the policy.
Indicate who approved the policy and the date of approval (for example, the board, the human resources policy committee, the executive director).
Visit our article on Drafting an HR Policy to learn more about developing HR policies.
Important: This document is an example of a policy for a small to medium-size nonprofit organization operating in Canada. While certain assumptions have been made in the creation of this policy, it is your responsibility to adapt, modify, and customize the document to suit the particular needs of your organization.
The content of this sample policy is provided for information purposes only. No legal liability or other responsibility is accepted by or on behalf of HR Intervals, Imagine Canada, or its partners for any errors, omissions, or statements made within this document. HR Intervals, Imagine Canada, and its partners accept no responsibility for any loss, damage or inconvenience caused as a result of reliance on such information.