Introduction to Job Evaluation
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O u t l i n e o f t h e l e s s o n
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1.Terminologies of job evaluation
2.
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Concepts of job and evaluation
3.
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Objectives of job evaluation4.
Principles of job evaluation
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5.
JOB Evaluation criteria
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6.Job Evaluation process
7.
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Computerized job evaluation
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L e a r n i n g O b j e c t i v e s
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After studying this lesson, you should be able to:
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1. Understand the various terms of job evolutions
2. Define the term job evolution
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3. Outline the objectives of job evolution
4. List the principles of job evaluation
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5. Identify the criteria for job evaluation6. Observe the process of job evaluation
7. Look into the computerized job evaluation
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1
Introduction
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Once a right candidate is placed on a right job, the person needs to be dulycompensated for the job he/she performs. In the pursuit of equal payment, there
should be established a consistent and systematic relationship among base
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compensation rates for all the jobs within the organizations. The process of such
establishment is termed ,,job evaluation. Different jobs in an organization need
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to be valued to ascertain their relative worth so that jobs are compensatedaccordingly and an equitable wage and salary structure is designed in the
organization. This is necessary for sustaining cordial relations within and
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between employees and employer. Hence, there is a need for appreciation of
intricacies of the job evaluation in the modern organizations. This lesson, as a
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first steps, dedicated to discuss the various fundamental aspects of jobevolution.
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Concept and related terminologies of job evaluation
In the area of job evaluation study, a certain amount of technical terminology is
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used in order to facilitate communication. It is therefore desirable to list andunderstand allied terms in the job evaluation, as well as some terms that are
related to and often confused with job evaluation (Exhibit. 1.1).
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Position: A position is a group of tasks assigned to one individual. There are as
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many positions in a firm as there are personnel.Job: Edwin B.Flippo describes job as a group of positions that are similar as to
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kind and level of work. In some instances only one position may be involved,
simply because no other similar position exists. For example, in the typical firm
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the position of human resource manager also constitute a job since there is onlyone human resource manager in the organizing.
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Job Analysis: It is the process of studying and collecting information relating to
the operations and responsibilities of a specific job. The immediate products of
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this analysis are job descriptions and job specifications.
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Motion study: This also involves study of the job. Motions study is one of theways of studying job. It is a process of analyzing a job to find the easiest, most
effective, and most economical method of doing it. As such, motion study is a
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part of the job design function.
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Job description: It is an organized, factual statement of the duties andresponsibilities of a specific job. In brief, it should tell what is to be done, how it
is to be done, and why. It is a standard of function, in that it defines the
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appropriate and authorized content of a job.
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Job specification: It is a statement of the minimum acceptable human qualitiesnecessary to perform a job properly. It is a standard of personnel and designates
the qualities required for acceptable performance.
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Evaluation: Wigley explains evaluation as a data reduction process that
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involves the collection of large amounts of data which are analyzed andsynthesized into an overall judgment of worth or merit. The implication here is
that the judgment of worth can be supported by the data. In her review, Foxon
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found similar definitions referring to judgments of value or worth.
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Job Evaluation: It is a systematic and orderly process of determining the worthof a job in relation to other jobs. The objective of this process is to determine
the correct rate of pay. It is therefore not the same as job analysis. Rather it
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follows the job analysis process, which provides the basic data to be evaluated.
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3Exhibit. 1.1
Job evaluation
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Measuringrelative worth of a
job
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Job specification
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Job AnalysisStatement of
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Process of
Job
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minimum acceptablecollecting job
Human qualities
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related data
Job description
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Statement of a jobduties and
responsibilities
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In simple worlds, job evaluation is the rating of jobs in an organization. This is
the process establishing the value or worth of jobs in a job hierarchy and
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compares the relative intrinsic value or worth of jobs within an organization.
Some renounced definitions of job evaluation are described below.
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Scott, Clothier and Priegel defines job evaluation as "the operation of
evaluating a particular job in relation to other jobs either within or outside the
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organization".
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Dale Yoder described job evaluation as "a practice which seeks to provide adegree of objectivity in measuring the comparative value of jobs within an
organization and among similar organizations".
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Edwin B.Flippo defines job evaluation as "a systematic and orderly process of
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determining the worth of a job in relation to other jobs".4
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Arthur A. Sloane described job evaluation as "any formalized system thatattempts to determine the relative worth of different jobs in the organization so
that jobs of greater value can be rewarded by greater pay".
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According to the International Labour Organization (ILO), "job evaluation is
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an attempt to determine and compare the demands which the normalperformance of a particular job makes on normal workers, without taking into
account the individual abilities or performance of the workers concerned".
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The British Institute of Management defines "job evaluation as the process of
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analysis and assessment of jobs to ascertain reliably their negative worth usingthe assessment as the basis for a balanced wages structure".
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Wendell French defines job evaluation as "a process of determining the relative
worth of the various jobs within the organization, so that differential wages may
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be paid to jobs of different worth. The relative worth of a job means relativevalue produced. The variables which are assumed to be related to value
produced are such factors as responsibility, skill, effort and working
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conditions".
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Objectives of job evaluationThe main objective of job evaluation is to ensure equitable remuneration for
relative worth of a job. As per the ILO Report, the aim of the majority of
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systems of job evaluation is to establish, on agreed logical basis, the relative
values of different jobs in a given plant or machinery, i.e., it aims at determining
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the relative worth of a job. The principle upon which all job evaluation schemesare based is that of describing and assessing the value of all jobs in the firms in
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terms of a number of factors, the relative importance of which varies from job to
job".
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The objectives of job evaluation, to put in a more systematic manner are to:
1. Establish a standard procedure for determining the relative worth of
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each job in an organization;2. Ensure equitable wage for a job and reasonable wage differentials
between different jobs in a hierarchical organization;
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3. Determine the rate of pay for each job which is fair and equitable with
relation to other jobs in the plant, community or industry;
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4. Eliminate wage inequalities;5. Use as a basis for fixing incentives and different bonus plans;
6. Promote a fair and accurate consideration of all employees for
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advancement and transfer;
7. Provide information for work organization, employees selection,
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placement, training and other similar purposes;8. Provide a benchmark for making career planning for the employees in
the organization and;
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9. Ensure that like wages are paid to all qualified employees for like
work.
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Principles of job evaluation
The job evaluation has certain principles. These principles are supposed to be
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kept in the mind of the job evaluators. These principles are not only directives
of proper job evaluation but also provide clarity in the process of evaluation.
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According to Kress, these principles are:1. Rate the job and the jobber. Each element should be rated on the basis of
what the job itself requires;
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2. The elements selected for rating purposes should be easily explainable in
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terms and a few in numbers as will cover the necessary requisites for
every job without any overlapping;
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3. The elements should be clearly defined and properly selected;4. Any job rating plan must be sold to foremen and employees. The success
in selling it will depend on a clear-cut explanation and illustration of the
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plan;
5. Foreman should participate in the rating of jobs in their own
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departments;6. Maxim mum co-operation can be obtained from employees when they
themselves have an opportunity to discuss job ratings and;
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7. Too many occupational wages should not be established. It would be
unwise to adopt an occupational wage for each total of point values.
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Job Evaluation Criteria
The system of job evaluation utilises a total of eight measurement factors.
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The various factors analyse a position in relation to the skills and
experience required for competent performance, the demands made on the
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job and the overall structure and responsibility/accountability involved. Apoint rating is derived for each factor and the sum of these points represents
the total points value of the job.
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Basic Evaluation Rules: The basic rules for evaluating each position are:
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1. The current position is evaluated without being influenced by what thejob is likely to be in the future or what it may have been in the past.
2. The position is evaluated and not the job holder. The assessment
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of each factor is based on the job being performed competently. The
assessment of the job holders own performance against the standard
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required is a quite separate exercise which is outside the scope of the
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job evaluation rating.The Job Evaluation Factors: The job evaluation system comprises the following
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factors: In some cases minor changes to the wording are used to define
factors and levels made in order to better align the methodology with
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the clients culture and environment. Where this is done, great care istaken to ensure inter-organisation consistency is not compromised. The
primary factor in determining compensation is an evaluation of work performed.
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The internal worth of a job is evaluated based upon factor like - Know-How,
Problem Solving, and Accountability, Education, Experience, Complexity
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involved in the job, Scope of job, Supervision received and, AuthorityExercised.
1. Know-How ? The knowledge, skill and experience required for
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standard acceptable performance. It considers the requirement for
technical and professional skills, expertise and experience, the amount
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of planning and organising required and the requirement to work withand through others. The three dimensions of Know-How are listed below
exhibit.1.2.
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Exhibit.1.2
Technical
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Measures levels ranging from learning basics work toKnow-How
specialized techniques and knowledge to professional
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mastery of scientific theory.
Managerial
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Measures the jobs requirements to integrate diversifiedKnow- How
types of supervisory or managerial activities.
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Human
Measures the degree to which the job requires practical
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relationperson to-person skills in persuasion, motivation, and
Know-how
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selection of people.
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82. Problem Solving ? the thinking required for analysing, evaluating,
creating, reasoning, arriving at and drawing conclusions; the extent
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to which this thinking is covered by precedents or circumscribed bystandards; and the degree of creativity or original thought required. The
two dimension of problem solving are presented below.
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Exhibit.1.3
Thinking
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The degree of structure provided by the job in solvingenvironment problems.
Thinking
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It is the complexity of the problems in the job assignment
Challenge
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and the amount of thinking required to solve job-relatedproblem.
3. Accountability ? The degree to which the employee is held accountable for
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taking action and for the consequences of that action. It is the measured
effect of the job on end results. The freedom to act measured through the
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existence or absence of constraints by managers, committees andprocedures and the impact of that action on the organization. The three
dimensions of accountability are depicted in below exhibit.
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Exhibit.1.4
Freedom to act
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Measures the relative degree to which decisions canbe made, the level of authority which is needed, or
the precedents, policies, and procedures which must
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be considered before an employee can take action.
Magnitude
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It is the degree of influence a position has on theorganizational operations.
Impact
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It is the degree to which the job affects the
organizational operations. Some jobs are directly
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responsible for actions while others provide counseland advice, which is used by others to take action.
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4. Education - The level of formal education required to perform the
functions required of a position. There is often an overlap between
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education and experience, and for this reason it is often advisable to
consider the education level that would be expected of a new incumbent
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recruited externally.5. Experience - The length of practical experience and nature of
technical/managerial familiarity required. This experience is in addition
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to formal education.
6. Complexity ? measured in terms of: (a) the time taken to learn and adjust
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to specific job requirements, (b) the level to which the job functions aredefined and follow established and predictable patterns and, (c) the
thinking challenge required to adapt to rapidly changing
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circumstances and innovative or conceptual thinking needed to initiate
new corporate direction.
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7. Scope of Job - The complexity and scope of work factors tend to berelated to the education and experience level required of a position. The
calculation of points for each of these factors is based on the application
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of a percentage rating of the sum of the points derived in the evaluation
of Education and Experience.
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8. Supervision Received -The extent of supervision, direction or guidanceimposed on the job holder and the freedom the executive has to take
action.
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9. Authority Exercised - Authority level expressed in terms of routine
expenditure, capital expenditure and investments, granting of loans,
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10Job Evaluation Process
Job Evaluation is a technique to rank jobs in an organization on the basis of
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the duties and responsibilities assigned to the job. The job evaluation processresults in a job being assigned to a pay grade. The pay grade is associated with
a pay range that is defined by a minimum and a maximum pay rate. A model of
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job evaluation process with the following steps is presented bellow (Exhibit
1.5).
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Step One -Job Description - The position supervisor assigns duties and writes the
job description. If there is an incumbent employee, s/he reviews it, and they
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both sign it. Instructions and additional assistance are available from
Human Resources, if needed. The job description is a snapshot of the job as
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it presently exists, reflecting the current duties and responsibilities of the joband/or the incumbent.
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Step Two ? Approval - The vice president reviews job descriptions and, if s/he
concurs, approves the responsibilities, requirements, and depart-mental
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organization contained within a job description presented for new evaluation,and signs it. If the vice president does not concur with the contents of the
description, it is returned to the supervisor for changes.
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Step Three ? Review- Human Resources reviews the job description as
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submitted with the supervisor prior to evaluation by the Job EvaluationCommittee (Step 4). Human Resources help ensure that there is consistency
and equity in the job descriptions and titles by editing them for clarity and
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format. If the Human Resources Office makes changes, the job description is
returned to the supervisor and vice president for signature prior to being
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presented to the Job Evaluation Committee (Step 4).11
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Step Four ? Evaluation - The Job Evaluation Committee (JEC) is a multi-
member committee, the members of which are appointed by the Staff Salary
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Administration Committee (SSAC), representing employees throughout
organization. JEC ensures equity among jobs through the use of established,
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consistent criteria for evaluation and prevents escalation of the jo