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External market links some see job evaluation as a

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External market links Some see job evaluation as a process for linking job content and internal value with external market rates. Aspects of job content (eg skills required) take on value based on their relationship to market wages. Because higher skill levels or willingness to work more closely with customers usually commands higher wages in the labour market, skill level and nature of customer contacts become useful criteria for establishing differences among jobs. If some aspect of job content, such as stressful working conditions, is not related to wages paid in the external labour market, then that aspect may be excluded in the job evaluation. In this perspective, the value of job content is based on what it can command in the external market; it has no intrinsic value. Here the assumption is that value cannot be determined without external market. Three most important job evaluation systems used in South Africa are: Paterson Peromnes Hay-MSL (a) The Paterson system This system measures jobs in terms of the highest level of decision making required of the incumbent. The system defines six bands of decision making common to all companies. The level of difficulty of decisions increases from completely defined decisions at Band A to policy making decisions at Band F. With the exception of Band A, each band is divided into two grades with the workers in the upper grade supervising or co-ordinating the work of the lower grade. These grades may be further divided into sub-grades, which may vary from organisation to organisation. (b) The Peromnes system This system is a points method of evaluation, which assesses jobs on the basis of eight factors. The most important feature of the Peromnes method is that it evaluates the job and not the person holding it. The eight factors referred to above are the following: Factor 1 : problem solving (decision making) Factor 2 : consequences of errors or judgement Factor 3 : work pressure Factor 4 : knowledge Factor 5 : job tendency Factor 6 : understanding Factor 7 : educational qualifications Factor 8 : training/experience (c) The Hay method This method measures three factors, which are regarded as being common to all jobs. These factors are the following: Know-how : this implies the expertise required by the job which includes aspects such as knowledge, experience, training, education and intellectual ability Problem solving : this implies the amount of problem solving required by the job or, conversely, whether the need to solve problems is restricted Accountability : this implies how much freedom a jobholder has to make decisions and the impact of those decisions
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54 3.3 Discuss why an organisation should be concerned with internal alignment. In your answer, define internal alignment and pay structure and discuss internal alignment in terms of efficiency, equity and compliance with legal requirements. (10) Use study unit 3 as point of departure for answering this question. Look at “Compensation strategy: internal alignment” and “Consequences of structures” in the prescribed book.
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