Internally Consistent
Compensation Systems
Chapter #7
All jobs have to be clearly defined
and valued
• Job analysis
• Defines job content
• Job evaluation
Job Evaluation defines ee
requirements and working conditions
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Determine which analysis program to use
Select and train analysts
Direct job analyst orientation
Write job descriptions
Standard Occupational Classification
System, www.bls.gov/soc/
• Look #150 Units of Analysis
• Look #151 Major occupational groups
• The new revised SOC will be useful for
compensation specialists
• Conduct the study and start collecting data
Direct Job Analyst Orientation
Most common methods of job
analysis
• Questionnaires
– Job encumbents
– Two analysts should reach similar conclusions
– video
• Observation
Job Descriptions
• Look page # 154
• Must be used to proved compliance
• EEOC
• ADA
• FLSA
Revised to include new service sector
tech jobs
• #155 - #166
O*NET
• O*Net was revised for new tech jobs and
service sector jobs
• Six content areas
– Experience requirements
– Occupation requirements
– Workforce characteristics
– Worker requirements
– Occupation-Specific Information
– Worker Characteristics
Experience
• Licensing
• Experience and training
• Additional education
– Degrees
– Certifications
– Professional associations
Occupational Requirements
• Generalized work activities
• Organizational context
• Work context
Occupation-specific requirements
• Apply to a narrow set of elements
• Look #158
Workforce Characteristics
• Labor market information
• Occupational Outlooks
Worker Characteristics
• Abilities
• Work styles
• Interests
• #160
Worker Requirements
• Basic skills
• Cross functional skills
• http://online.onetcenter.org
Job evaluation
• To systematically recognize differences in the
relative worth among a set of jobs and
establish pay differentials
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3 Universal compensable factors
Skills
Knowledge
Abilities
Job Evaluation Process
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Determine technique
Choose committee
Train the evaluators
Document the evaluation plan
Communicate with EES
Set up appeals process
Techniques
• Market based evaluation
• Job content evaluation
• Point Method
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Benchmark jobs
Choose compensable factors
Define factor degree
Determine weight of each factor
Determine point values
Evaluate all jobs
How do you balance internal and
market considerations with point
methods?
• Simple ranking plans
• Paired Comparisons
• Alternation ranking
• Place jobs into categories
Class exercise
• Calculate geographic pay differences
» This ex. will help you to understand what to expect
and what you can ask for when it comes to
determine your salary like cost of living differences
based on location. Using the following sites caluculate
differences in pay for two cities
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OKC and Seattle
www.homefair.com (select salary calculator
www.datamasters.com (select cost – of- living data)
www. bestplaces.net (cost-of-living)
You can also use a search for “salary calculator:” Are the
numbers the same for each website?