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7-1

A Human Resource A Human Resource Management ApproachManagement Approach

STRATEGIC STRATEGIC COMPENSATIONCOMPENSATION

Prepared by David Oakes

Chapter 7Chapter 7

Building Internally Consistent Building Internally Consistent Compensation SystemsCompensation Systems

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7-2

Internal ConsistencyInternal Consistency

Compares value of a job against others

Represents job structure or hierarchy

Job descriptions are its cornerstone

Recognizes differences in job characteristics

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7-3

Job Structure ProcessesJob Structure Processes

Job analysis A descriptive procedure Identifies & defines job content

Job evaluation Reflects value judgments Compensation systems set pay levels

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7-4

Worker Requirements Worker Requirements

Skills Education Experience Licenses Permits Special abilities

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7-5

Job Analysis ProcessJob Analysis Process

Determine job analysis program Select & train analysts Direct job analyst orientation Conduct the study Summarize results: write job descriptions

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7-6

Job Analysis Data Gathering Job Analysis Data Gathering MethodsMethods

Questionnaires

Interviews

Observation

Participation

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7-7

JOB ANALYSIS UNITSJOB ANALYSIS UNITS

Elements Tasks Position Job Job family Occupation

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7-8

S O CS O C Standard Occupational Classification System Office of Management and Budget Replaces DOT Lists

23 Occupational Groups, 98 Minor Groups 452 Broad occupations 822 Detailed occupations

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7-9

SourcesSources

Job incumbents

Supervisors

Job analysts

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7-10

Writing Job DescriptionsWriting Job Descriptions

Should Include Job title

Job summary

Job duties

Worker specifications

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7-11

Legal ConsiderationsLegal Considerations

Equal Pay Act Must justify pay differences

FLSA Determine exemption status

ADA Determine essential job functions

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7-12

ADA GuidelinesADA GuidelinesEssential Job FunctionsEssential Job Functions

Position has an essential function Requires high skills or expertise Decided case - by - case Non - essential jobs are marginal

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7-13

O*NET CategoriesO*NET Categories

Experience requirements Occupational requirements Occupation specific requirements Worker requirements Worker characteristics Labor market characteristics

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7-14

ExperienceExperienceRequirementsRequirements

Experience & training Related work experience On - site training On - the - job training Apprenticeships

Licensing Licenses & certificates Formal education

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7-15

Occupation RequirementsOccupation Requirements

Occupational skills

Occupational knowledge

Tasks

Duties

Machines Tools Equipment

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7-16

Worker Worker Requirements Requirements

Basic skills

Cross - functional skills

Knowledge

Education

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7-17

O*NET SourcesO*NET Sources

Libraries, public & academic

U.S. Government Printing Office

http://www.doleta.gov American Psychological Assoc “An Occupational Information System for the 21st Century: The Development of O*NET”

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7-18

Universal Compensable FactorsUniversal Compensable Factors

Skill

Effort

Responsibility

Working conditions

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7-19

Job Evaluation Process StepsJob Evaluation Process Steps

Select technique Choose committee Train members to evaluate Document plan Communicate with employees Set-up appeals process

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7-20

Point Method StepsPoint Method Steps

Select benchmark jobs Choose compensable factors Define factor degrees Determine weight of factors Determine point value Verify factor degrees & point values Evaluate all jobs

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7-21

Job Evaluation Qualitative Job Evaluation Qualitative ApproachesApproaches

Simple ranking plan

Paired comparisons

Alternation ranking

Classification plans

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7-22

Alternatives To Job EvaluationsAlternatives To Job Evaluations

Market pay rates

Pay incentives

Individual rates

Collective bargaining